Repeal and Replace Obamacare? It’s Not Gonna Be Easy

President-elect Donald Trump and congressional Republican leaders are promising to make repeal and replacement of the Affordable Care Act one of their highest priorities in the first 100 days after they take full control of the federal government in January.

But both Republican and Democratic health policy experts say the road will be rocky and that it may take a lot longer and involve a lot more compromises than they think. They predict Republicans may seek Democratic support in crafting a replacement to avoid full responsibility for any problems that follow.

Some predict bipartisan support is highly unlikely if Republicans pursue their goal of completely wiping out the ACA framework rather than making more modest fixes. Odds for cooperation are even more remote if Trump and congressional leaders also seek to restructure Medicare, which he and House Speaker Paul Ryan signaled last week. “I cannot imagine the Dems going along,” said Theda Skocpol, an expert on healthcare politics at Harvard University. “They would be out of their minds.”

Trump said Thursday his top three agenda items would be border security, the economy and healthcare reform. “Very important, we’re looking very strongly at healthcare and we’re looking at jobs,” he said.

His shocking election victory over Democrat Hillary Clinton completely scrambles the widespread thinking in the healthcare industry that the ACA framework for the healthcare system is here to stay. Now leaders in all healthcare sectors have to reassess their strategies and decide whether to accommodate the big changes proposed by Trump and congressional Republicans or try to fight them. Already, hospital leaders in Texas and elsewhere are urging Republicans to find ways to preserve the law’s coverage gains.

Nevertheless, Trump, Ryan, and Senate Majority Leader Mitch McConnell are expected to pursue repeal of the ACA’s individual mandate, premium subsidies, Medicaid expansion, and various taxes including the “Cadillac plan” and medical-device taxes, possibly with a two-year delay to allow time for developing a replacement package. That’s in line with the GOP repeal bill passed last January and vetoed by President Barack Obama.

Last week, Trump and Ryan expanded the healthcare agenda to include “modernizing” Medicare, widely seen as an allusion to Ryan’s plan to convert Medicare into a defined contribution, “premium support” program that could impose higher costs on seniors. Ryan told Fox News that “Medicare has got some serious problems because of Obamacare. Those things are part of our plan to replace Obamacare.” During the election campaign, Trump repeatedly said he wouldn’t touch Medicare.

The Republicans have indicated they will try to enact the ACA changes through an expedited budget reconciliation process, which only requires 51 votes in the Senate for passage but can be used solely to address provisions affecting taxes and revenue. They would have to pass separate legislation through the regular legislative process to address other ACA features such as the exchanges, minimum essential benefits, guaranteed issue of insurance and the CMS Innovation Center.

Republicans have offered only a sketchy outline of what their replacement package would look like, including tax deductions or credits to help people afford coverage and expansion of health savings accounts. Republican experts say they’ll need months to cobble together detailed legislation, which then would face Congressional Budget Office scrutiny of its cost and coverage impact.

Even without legislation, the Trump administration will have many ways of unraveling the ACA through executive action. But it will have to be careful not to undercut the ACA’s individual markets—prompting more insurers to pull out and premiums to shoot up—before Republicans have established a replacement system.

On Friday, the Trump team named Andrew Bremberg, an adviser to Senate Majority Leader Mitch McConnell, to head the HHS transition team, sources said. Bremberg is among the people discussed as possible Trump picks for a top health post, along with former GOP presidential candidate Dr. Ben Carson and former Louisiana Gov. Bobby Jindal.

Trump’s election may end hopes of expanding Medicaid in the 19 states that have not yet implemented it, including in GOP-led states such as Utah and Idaho that were considering it. And it puts the expansion in the other 31 states and the District of Columbia in serious jeopardy. “No sense in working on the branches of a problem if the root is going to be pulled up,” Idaho House Speaker Scott Bedke said last Wednesday.

But Republican governors in states that have expanded Medicaid may resist the elimination or reduction of federal funding for coverage expansion to millions of low-income adults, which has financially helped healthcare providers. Michigan Gov. Rick Snyder will work to “convey the successes” of his state’s Medicaid expansion to Trump and the new Congress, a Snyder spokesman told Politico.

It’s expected that congressional Republicans will preserve the new Medicare physician payment system and maintain the ACA’s focus on shifting from fee-for-service payment to value-based payment, though they may seek to achieve that through the private market rather than government initiatives.

Some Republicans are worried about moving too fast and too far on healthcare changes, risking blowback from the public and stakeholder groups and potentially hurting their party in the 2018 congressional elections. The CBO concluded that the GOP repeal bill vetoed in January would add 22 million Americans to the ranks of the uninsured. Modern Healthcare’s second-quarter CEO Power Panel survey of healthcare executives found that more than two-thirds of 86 chief executives opposed repealing and replacing the ACA.

“Any time a party has been out of power for a period, they often try to move too fast or do it in ways that appear to the public reckless,” Michael Leavitt, former Republican governor of Utah and HHS secretary in the George W. Bush administration, cautioned during a Leavitt Partners webinar Thursday.

“I think it’s always a mistake to misread your mandate,” McConnell said last week. “We’ve been given a temporary lease on power, if you will.”

Leavitt advised the Trump administration and congressional leaders to pursue healthcare changes deliberately and not make this the high-profile focus of their 2017 agenda. “Many other issues will now be more prominent because of Trump’s agenda,” Leavitt said. “If you can move it out of the big top where political combat is happening, you can probably get more things done.”

But keeping the issue low key may be impossible. Republicans will face enormous complexity, excruciating trade-offs and sharp political conflicts in repealing and replacing the ACA, which has become deeply embedded in the healthcare system. The Trump administration likely will have to invest lots of time and political capital in the healthcare overhaul, just as the Obama administration did in its first year. That battle will be even tougher if Trump and Ryan add Medicare restructuring to the package.

“Trump may figure out, or someone in his inner circle may tell him, that if he goes with a rapid Obamacare repeal and Ryan’s Medicare privatization, he’ll set off an explosion that could flip the House in 2018,” Skocpol said.

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