From Obamacare to Trumpcare – implications for gastroenterologists

Repeal and replace

Destruction of the ACA is a top priority of President Trump and Republican leaders of both houses of Congress. The ACA was a Democratic bill (passed with no Republican support), although it had many similarities to previous Republican legislative ideas dating from 1993.³

Although outright repeal could be blocked by a Democratic filibuster, the law could be drastically modified through budget reconciliation whose passage takes only a simple Senate majority. Thus, a simple budget-related bill could serve as a vehicle to defund many parts of ACA, including money for Medicaid expansion, insurance risk corridors, money to offset out-of-pocket expenses and individual premium subsidies, for example.^4,5

There would be substantial problems if ACA were repealed even with a 2- or 3-year delay, a scenario proposed to provide time for a replacement bill. On Jan. 4, 2017, the House Republican Study Committee introduced the American Health Care Reform Act (AHCRA) as a replacement proposal, with the stipulation that ACA would be repealed as of Jan. 1, 2018. This initial bill hinted at Republican intent and was detailed in a Health Affairs blog.⁶ Importantly, there were distinct similarities between this and prior Republican proposals put forward by Representative Tom Price (nominated to head the Department of Health & Human Services under President Trump) and Speaker of the House Paul Ryan.^7,8

Consistently, Republicans have advocated for expansion of health savings accounts, altering the tax code to allow individuals to deduct health insurance premiums, establishment of association risk pools, imposition of malpractice limits, protections for people with preexisting conditions, and further restrictions on abortion coverage. The AHCRA changes financial subsidies for purchasing insurance from a tax credit (which can be paid to people even if they do not pay taxes) to a tax deduction (only applicable to people who pay taxes). Analysis of a similar proposal made by President Trump during the campaign found that this plan would increase the number of uninsured people by more than 15 million.

If ACA is repealed, effects would be broader than just factors related to insurance coverage.⁹ ACA provides for preventive care (including colonoscopy) without copays, education of additional medical personnel, closing the donut hole for Medicare Part D (medications), approval of generic biologics, and Medicaid expansions, among other initiatives. If ACA were defunded without restoring pre-ACA support for Disproportion Share Hospital charity care, research, and graduate medical education, then safety-net hospitals and many academic medical centers (AMCs) could face enormous funding cuts.¹⁰ Defunding Medicaid expansion would adversely affect states in many ways, as pointed out by Ayanian et al.¹¹ Medicaid expansion had broad economic impact in states that accepted federal money to expand. In Michigan for example, 30,900 jobs were added to the state in 2016 because of Medicaid expansion, with two-thirds outside of the health care industry. President Obama defined his view about the effects of ACA repeal in the New England Journal of Medicine.¹²

Lessons learned

Economic principles and unique characteristics of United States health care help explain why solutions to its high cost and uneven coverage are so difficult to achieve. These include higher prices for goods in the United States compared with other countries, variation in price (unrelated to quality), restraints on government price negotiations, inefficiencies due to variation in size of delivery systems, and “moral hazard” related to rich insurance coverage, which are some of the factors that doom any simple solutions. These are reviewed by Victor Fuchs¹³ in an excellent article in Annals of Internal Medicine. Payment methods for health care services also distort resource use and efficiencies. Understanding the eight basic payment methodologies in health care and current predictions about future health care spending will be important in shaping reimbursement policies.^14,15

Disruptions in health care are unpopular and, as Uve Reinardt stated: “Our health care financing system will always remain a horrendous mess and a fountain for such dismay among the providers of health care as well as among patients.”⁴ Lessons to inform the next iteration of health care policy, learned from the 2009-2010 experience, might be as follows:

1. If a bill is to be passed, the president must personally lead in explaining the bill to the public in simple terms.

2. Even the threat of repeal may disrupt the current market and force insurance companies to exit quickly.

3. Coverage must be affordable to individuals, state budgets, and health care providers. Because expansion states saw positive impacts to state budgets⁸ and mental health and substance abuse services became part of Medicaid benefits, how will a replacement bill maintain coverage and compensate for new state moneys used now for other imperatives such as education and infrastructure?

4. Health care is like a massive cargo ship, not a sports car, so a bill to replace the ACA may take a long time (and might never be passed).

5. Health care is intensely personal, so it will always be politically charged.