The Republican-dominated Congress that starts its 2017 work Jan. 3 is determined to repeal Obamacare – and fast. Yet consumers may not notice any difference in their health care coverage for a long time.
Eradicating tax and spending-related provisions of the 2010 law that requires nearly everyone to have health insurance should be fairly easy. The harder task is replacing it, and “the eventual result will take several years,” said Sen. Lamar Alexander, R-Tenn., chairman of the Senate Health, Education, Labor and Pensions Committee.
In the House of Representatives, Rep. Mark Walker, R-N.C., is all for dramatic changes, but he warns that moving too quickly is unrealistic.
“The original bill was thousands of pages and has tentacles that are incredibly deep, and there’s been four or five years of dependency that’s grown out of that,” said Walker, who next year will head the House’s Republican Study Committee, the chamber’s influential conservative caucus. At least, Walker said, Congress can develop a framework for change in 2017.
Simply repealing key pieces of the law without replacing it risks cutting off health care for the 20 million people who, because of the Affordable Care Act, get coverage through the Medicaid program or receive federal help to pay their costs. Suddenly repealing certain provisions could also make it harder for the 52 million people under 65 with pre-existing conditions to buy coverage.
“Depending on how the transition period between repeal and replace is handled, there could be a great deal of instability,” said Cynthia Cox, associate director of health reform and private insurance at the Kaiser Family Foundation, a nonpartisan group that analyzes and researches health care issues.
If the requirement to buy coverage ends but insurers still have to cover people with pre-existing conditions, “there is a very real chance that could cause a death spiral in the individual insurance market,” Cox said.
If that happens, she said, “it’s not just the insurers who are affected, it’s also the doctors and hospitals and millions of consumers.”
Still, said Walker, repeal is inevitable. Republicans have made it a campaign issue since the law was enacted nearly seven years ago, and they continue to say that the current system is not only driving insurers from the market but also sending premiums soaring.
Their Exhibit A is the federal health insurance exchanges. They were supposed to promote competition and make it easier for consumers to shop for coverage. But one-third of all counties will have only one insurance alternative next year, up from 7 percent this year. Particularly limited are rural counties in North Carolina, South Carolina and other states.
Republicans, who will continue to control both houses of Congress next year, have three general ideas about how to proceed:
▪ Provide a lengthy transition period that eases the impact of any changes.
Republican leaders are reluctant to set a timetable. “It’s just premature to suggest that we know exactly how long this transition is,” said House Speaker Paul Ryan, R-Wis.
Sen. Chuck Schumer, D-N.Y., saw that attitude as illustrating that the GOP hasn’t thought this process through. “They don’t know what to do. They’re like the dog that caught the bus,” he said.
Another problem: Any delay that takes longer than two years means the new Congress seated in January 2019 could deal with the issue, and there’s no guarantee it will have as many Republicans.
▪ Strictly limit the transition period. The thinking here is that everyone would be forced to adopt an alternative.
“You know this is going away five months from now, and you’re going to avoid it?” asked House Majority Leader Kevin McCarthy, R-Calif., though he was talking about a deadline, not specifically saying it should be five months.
There seems to be little sentiment for that approach, however. A tight deadline for action would leave GOP lawmakers vulnerable to charges they’re willing to strand millions without coverage.
“The closer they get to a repeal vote, the more they’re going to realize the consequences of repeal,” said Rep. G. K. Butterfield, D-N.C.
▪ Follow, or at least work from, a blueprint Ryan offered earlier this year. The timetable for that process is unclear.
His “A Better Way” health care plan has several ideas popular with Republicans. Coverage could be sold across state lines, which supporters say would boost competition and keep prices down. Ryan would encourage individual health savings accounts, which allow people to save tax-free and use the money for health care expenses.
Rep. Tom Price, R-Ga., the health and human services secretary-designate, has sought alternatives to Obamacare for years, and Ryan has embraced many of Price’s ideas.
Any Republican replacement plan faces its stiffest challenges from at least three aspects of Obamacare that have proved popular: Medicaid expansion, the ban on denying coverage for people with pre-existing conditions and allowing people under 26 to remain on their parents’ policies.
Obamacare expanded eligibility for Medicaid, the joint state-federal health care program for lower-income people, allowing an estimated 11 million more people to have coverage last year. Washington provided billions to help states pay for that.
Thirty-one states and the District of Columbia agreed to the expansion. States that did not tended to be governed by conservatives who objected to Obamacare and were concerned they would eventually take on the costs. But 16 of the expansion states will be led by GOP governors next year, raising new questions about how they will handle changes.
Trump has said he wants the states to have more authority over how Medicaid is run.
He’s also sympathetic to the under-26 policy and the law’s assurance that people with pre-existing conditions won’t be denied coverage. GOP leaders have discussed a scenario where higher-risk consumers move into special pools where premiums are federally subsidized – though that would mean more federal spending.
Kaiser estimates that about 1 in 4 adults under 65 could be uninsurable if they sought coverage on their own, due to pre-existing conditions under laws in effect before Obamacare.
For example, pre-Obamacare uninsurables under 65 in North Carolina would be 27 percent; in South Carolina, 28 percent; Missouri, 30 percent; Idaho, 25 percent; Florida, 26 percent. Among the conditions that were used to deny coverage were AIDS/HIV, epilepsy, pregnancy, sleep apnea, Parkinson’s disease and arthritis.
The health insurance industry’s trade association is waiting and watchful.
“There are still many proposals yet to be proposed and ideas yet to be debated – but we are committed to finding the most effective solutions that deliver affordable coverage and high-quality care for every American,” said David Merritt, executive vice president of America’s Health Insurance Plans.
Republicans offer few specific answers to how or when they’ll resolve all the issues. Senate Majority Leader Mitch McConnell, R-Ky., was resolute when he told reporters this month: “We will move right after the first of the year on an Obamacare replacement resolution.”
Asked whether he has a preference on enacting a new system, he said: “When we get through deciding how we’re going to do that, I’ll be happy to let you know.”
Congressional party lineup in 2017