The Congressional Budget Office analysis of the American Health Care Act that was released Wednesday afternoon reinforces what Republicans in Congress surely must be beginning to recognize: Engineering a piece of health care reform legislation that can satisfy the hard-core conservatives in the House and the more moderate members of the Senate is going to be difficult, verging on impossible.
What many may not realize is that they could be walking into a trap that leads, ironically, to more federal management of health care, not less.
The AHCA would slash more than $800 billion in Medicaid spending, increase out-of-pocket premium costs for poor Americans by a factor of 9, and after 10 years, leave 23 million more Americans without health insurance than there would be under current law -- many of them with preexisting conditions who would be priced out of the market for individual coverage.
Even then, the AHCA passed in the House by a two-vote margin, partly because members of the House Freedom Caucus wanted to roll back the Affordable Care Act under the rules of reconciliation. Freedom Caucus members who did vote for the bill have stressed that getting to “Yes” was difficult for them and that changes to the delicate balance the law’s drafters achieved would probably cost them votes.
“If they revise it, there’s no way,” Rep. Dave Brat told The Washington Post after it passed. “Have you been watching for the last few months how tight this is, and you’re going to shift this one or the other? Good luck.”
Meanwhile, a small panel of 13 Republican senators is working in semi-secrecy to draft a health care proposal that can win at least 50 votes in the upper chamber, which would enable Vice President Mike Pence to cast a tie-breaking vote in a budget reconciliation bill.
The problem is that any bill that can bring along 50 out of 52 Republican senators probably isn’t going to be anything that can pass the House of Representatives. That would leave the two chambers with the task of reconciling the two bills. But given the nature of the House GOP conference, any relaxation of the AHCA’s cuts and rollback will cause defections that the leadership cannot afford.
Under normal circumstances, this wouldn’t be too much of a problem. With Republican Donald Trump in the White House for another three and a half years, GOP lawmakers could regroup and try again.
However, part of the strategy the GOP has employed in the fight against the ACA has been to declare that the law is in imminent danger of collapse. And to help make their case, they have been actively undermining it.
Congressional Republicans eliminated risk corridor payments to insurers, and Trump’s administration said it would stop enforcing the individual insurance mandate, and has repeatedly threatened to withhold risk-sharing payments. The result has been months of anxiety and chaos, as insurers tried to decide whether to continue offering policies on the ACA’s health insurance exchanges. Many ultimately decided to withdraw, and others have said that they will dramatically increase premiums to account for additional risk and uncertainty.
The situation is rapidly becoming unsustainable, and some of the state insurance exchanges have one or even no insurers serving large segments of their population. Health policy experts warn that there could be a mass exodus of insurers that leaves huge parts of the country without any companies offering insurance on the individual market.
What comes after that is far from clear.
Some lawmakers have suggested passing legislation that allows people who receive premium subsidies under the ACA to spend that money on insurance offered outside the health care exchanges. However, that’s problematic for many reasons.
First, the ACA placed requirements on policies sold through the exchanges, requiring them to cover certain “essential” benefits and to protect consumers from medically-induced financial catastrophe. Removing that restriction could lead to people using taxpayer dollars to purchase poor-quality insurance that offers no real financial protection and poor care.
Second, people shopping on the open market might find coverage unaffordable. The individual subsidies were only part of the system built into the ACA to make insurance affordable. Other elements were payments from the government to insurers that helped keep premiums down. Plans sold outside the exchanges aren’t eligible for those government funds, which would make them much more expensive than comparable exchange-based plans.
At this point, it’s possible that later this year, the individual market for health insurance could go into a crisis, and in the absence of an agreement on a new plan by Congressional Republicans, lawmakers would have to start hunting for a way to help millions of people losing coverage in the exchanges to find an alternative. It would have to be comprehensive, nationwide, and able to ramp up quickly.
Where would they look? There aren’t a whole lot of established nationwide health insurance programs with experience providing care to people from birth to old age. Fewer still that operate in virtually every community in the country.
In truth, there’s really only one. It’s called Medicaid.
It would be the irony of all ironies if the most hardcore conservatives in the House forced the country into a situation in which a massive Medicaid expansion was the best answer to a national healthcare crisis. But with every day that Republicans in Washington allow the ACA to wither without a viable replacement in the pipeline, it looks less like a fantasy and more like a real possibility.