Tag Archive: Trumpcare

The American Health Care Act isn’t Trumpcare. It’s a big bargaining chip.

The House budget reconciliation bill that makes radical fiscal tweaks to the Patient Protection and Affordable Care Act is not Trumpcare. Rather, it’s a major element of the Trump administration’s negotiation strategy to replace the Affordable Care Act as President Trump promised during the presidential campaign last year. Having business but no public policy background, Trump approaches policymaking as a sale and negotiation. Various analyses such as this one in today’s New York Times have concluded older people – who vote in greater numbers than younger ones — will come out a lot worse under the House reconciliation bill than the Affordable Care Act’s means tested (versus age-based) premium and out of pocket cost subsidies.

Those electors are pissed at that prospect and they’re showing up at Congressional district town halls to let their representatives know. Majority Republicans in Congress and the Trump administration know they are – and that they vote — and apparently intend to leverage that circumstance. The Republicans are essentially telling minority Democrats play ball and give us some support on a broader omnibus reform measure to succeed the Affordable Care Act, or else we’ll push this albatross of a reconciliation bill through since you lack the votes to filibuster it in the Senate. Without some Democratic support, any omnibus reform measure introduced as a regular (and not budget reconciliation) measure could be talked to death in the Senate by opposition Democrats.

It short, it’s a high stakes game of partisan chicken. The GOP is effectively saying to the Dems, unless you work with us and call off the Senate filibuster dogs, we’ll both potentially face the wrath of the voters in the 2018 midterm elections. The Trump administration is also developing a BATNA (Best Alternative to a Negotiated Agreement) if Democrats won’t come to the table. It’s the administration’s proposed Market Stabilization rulemaking intended to bolster the individual health insurance market and keep plan issuers in the market for plan year 2018.

 


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email fpilot@pilothealthstrategies.com or call 530-295-1473. 

What Trumpcare will likely look like

Donald Trump is following the path of every president elected before him from at least the Truman administration forward, proclaiming a public policy goal of providing medical insurance to all Americans. “We’re going to have insurance for everybody,” the soon to be president told The Washington Post last week. “It will be in a much simplified form,” he said. “Much less expensive and much better” than what’s available under the Affordable Care Act.

How will Trump bring that about? Wryly playing off then-House Speaker Nancy Pelosi’s famous statement in early 2010 that opponents of the Affordable Care Act would have to first vote for it in order to see all of its provisions, Trump similarly wants to see his Health and Human Services Secretary nominee Tom Price confirmed by the Senate before he reveals his plan.

I’ll go out on a limb and make some predictions on the rough outlines. This prediction assumes Trump will forge his own policy in this area and not necessarily conform to longstanding Republican principles that were posted to his transition website but have since been taken down. Trump’s reform plan won’t be a wholesale repeal of the Affordable Care Act. It will at least initially keep much of the omnibus reform statute intact and concentrate on scrapping Titles I and II dealing with the individual market reforms and expanded Medicaid eligibility to single adults given these components of the law have dominated the Republican reform agenda.

The Trump administration’s plan will give up on trying to make the problematic and inherently unstable individual market as it’s currently structured work with a mix of incentives and disincentives like those of the Affordable Care Act. The Trump plan will likely largely replace the nongroup market with something ironically along the lines of what Affordable Care Act designer Ezekiel Emanuel suggested last week: automatic enrollment in a catastrophic plan. Trump’s plan could offer a level of basic coverage for all working age Americans, starting when the reach their 18th birthday and lasting until they go onto Medicare at age 65 or older. As per Emanuel’s concept, there would be an option to enroll in supplemental plans for those who need or desire more generous coverage, similar to Medicare advantage plans. Most of the funding would come from new payroll and self-employment taxes. These supplemental plans could conceivably comport with Trump’s statement that his plan would offer low deductibles.

This reform of the nongroup market would also pave the way for a gradual transition away from employer-sponsored group plans. Employers would fund the aforementioned supplemental plans as an employee benefit. Or not. Either way, the dominance of employer-sponsored all inclusive medical coverage – which also dates to the Truman administration – would begin to go into decline.

As Trump stated previously, his plan will end the Title II Medicaid reforms and turn Medicaid into a state block grant program. Health savings accounts contribution limits will be increased and contributions permitted to cover supplemental plan premiums and any uncovered medical or dental expenses.

Finally, look for Trump’s plan to focus strongly on prescription drug costs to bend the medical care cost curve, creating a bidding entity or even a federal monopsony that will effectively set the prices of medications for all government programs, including the new basic health plan. Trump indicated in a news conference last week he will play hardball with the pharmaceutical industry.

 


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email fpilot@pilothealthstrategies.com or call 530-295-1473. 

%d bloggers like this: