Trump, Congress expected to ‘repeal and replace’ Obamacare, but with what? | Charlotte Observer

Within hours of winning the White House, President-elect Donald Trump affirmed his desire to scrap the Affordable Care Act, the Obama administration’s signature health care program.

In a Wednesday morning phone call, Trump and House Speaker Paul Ryan had “specific discussions about health care,” said Republican Rep. Robert Pittenger of North Carolina, who listened on a conference call as Ryan relayed the conversation to House Republicans. “Repealing Obamacare is a major priority.”

Health care experts interviewed by the Observer said they expect Trump and congressional Republicans to continue their attacks on the ACA. But they’re not sure what will replace it.

Trump’s election “creates tremendous uncertainty about the future of health care,” said Jonathan Oberlander, a professor of health policy at UNC Chapel Hill. “Obamacare is in tremendous peril. There’s a lot of uncertainty about what plan (Trump) would push. … I don’t think we can go back to status quo. Too much has changed.”

Open enrollment for the fourth year of the ACA marketplace is now underway, and federal health officials reported Thursday that more than 100,000 people selected plans on the day after the election, marking the strongest day for signups so far this year.

About 600,000 North Carolinians are covered through the marketplace, and more than 90 percent have qualified for federal subsidies to reduce premiums.

Since the ACA was enacted in 2010, House Republicans have voted more than 60 times to repeal it without success. The law has been criticized by Republicans as a failure, in part because of rising premiums for consumers who don’t qualify for federal subsidies. Proponents point out that the law has provided health insurance for 20 million Americans, many of whom were previously uninsured, and that it provides protections for people who had been unable to get insurance because of preexisting medical conditions.

Pittenger said the GOP-led Congress won’t leave these families in the lurch. Rather, he expects congressional leaders to try and cut a deal with Democrats to create a market-driven health care system that does away with some ACA mandates, such as the requirement that young, healthy people sign up for coverage to hold down costs for those are ill.

Pittenger said he expects any congressional action to be followed by a transition period of six months to a year. “The American people are not going to tolerate business as usual,” he said. “They voted for change. The No. 1 item on their mind where they want change is Obamacare.”

Premium spikes affect a relatively small number of people. Most Americans get their insurance through their employers, Medicare or Medicaid, with only 7 percent of Americans getting coverage on the ACA exchanges. That’s about 10 million people – and 85 percent of them qualify for premium subsidies.

At a Pennsylvania campaign rally just a week ago, Trump promised to “immediately repeal and replace Obamacare” if he were elected. In Tuesday’s elections, Republicans held on to House and Senate majorities, though Pittenger said negotiating a deal with the Democrats is the most likely course. Republicans are well short of the votes they would need to pass Senate legislation when a 60-vote “super-majority” is required.

Beyond vowing to repeal the program, Trump has provided few specifics of how he might address the nation’s complex health care problems, said Bruce Vladeck, who headed the federal Health Care Financing Administration in the 1990s. Vladeck said Republicans “don’t have a strategy to replace it” – at least not one that will work.

Pittenger disagreed. He’s a member of a House Republican committee that has created a set of principles for replacing the ACA, including barring insurers from refusing to cover people because of pre-existing medical conditions and requiring underwriters to give sick people the standard rates for premiums.

Oberlander said preserving the clause about pre-existing conditions won’t work without a mandate that compels healthy people, as well as sick ones, to join the insurance pool. “This is not so easy to unravel thread by thread because the threads are woven together,” Oberlander said.

Republicans can’t repeal the entire law, Oberlander said, but they could overturn major portions in other ways, such as through the annual budget process that allows Congress to make changes to spending without normal procedural hurdles.

Because Republicans generally don’t like regulations, Oberlander said they will probably try to get rid of mandates that individuals buy insurance and that employers provide insurance for employees or pay a penalty. They might also eliminate or reduce federal tax credits to purchase insurance, something that about 600,000 North Carolinians benefit from.

Pittenger contended that a market-driven approach, in which insurers are permitted to sell policies across state lines and individuals receive tax credits for signing up, would work better than mandates that impose tax penalties on people who don’t participate.

“You’re going to see a very open, competitive market in health care,” he said. “Competitive markets drive prices down, and they improve quality.”

America’s Health Insurance Plans, the trade association for health insurers, issued a statement echoing Pittenger. “A competitive private market can deliver more choice, higher quality and lower costs,” said the group, which is sure to be a central player in shaping any new system.

At a meeting with House Republicans last summer, Trump embraced their proposals for health care, tax and budget reforms, Pittenger said. “This is not a man who deals in the weeds,” he said. “He’s not a policy guy. He sees the big picture and the broad scope of the land and what needs to be done.”

More low-cost options

Katherine Restrepo, director of health care policy for the Raleigh-based John Locke Foundation, said it’s hard to know which Republican plan Trump might favor, if any. “Trump is pretty unpredictable,” she said. “When he was debating other Republican nominees (during the primary campaign), he was talking about how ‘single payer’ is good in other countries.”

Single-payer insurance could be similar to Medicare, where the federal government pays the bills for services provided by private doctors and hospitals. Such a plan has not been endorsed by Republicans.

“There’s so much of a divide within the Republican Party on how to reform Obamacare,” Restrepo said. “There’s going to have to be compromise even though it’s a Republican majority.”

Under the ACA, insurers are required to provide a set of “essential benefits,” but she said they should be able to sell less comprehensive plans. “Insurance could be so much more affordable if people paid for the basic stuff out-of-pocket.”

She favors a system of high-deductible, “catastrophic” policies that cover “the big stuff” but require consumers to pay for preventive screenings and less costly medical care. Premiums are lower, and consumers can contribute to “health savings accounts” that can be used for out-of-pocket costs. For low-income people, she said the federal government could make deposits into personal accounts for such expenses.

Hospitals concerned

Charlotte-area hospital executives expressed concern about the uncertainty facing their institutions and patients.

Republicans “haven’t had a very credible set of recommendations or alternatives to Obamacare,” said Bob Seehausen, a senior vice president at Novant Health. “But they’ve got 20 million people who have coverage now, and I don’t imagine that makes you many friends if you throw them back on the street without insurance.”

Because more people have insurance, Seehausen said, “the proportion of people that can pay their bills has improved.”

Gene Woods, CEO of Carolinas HealthCare System and chairman of the American Hospital Association, said he expects “some sort of ‘repeal and replace’ attempt. The question is what they would replace it with. … How do we make sure that no one’s harmed?”

Plenty of “noncontroversial areas of agreement” should receive bipartisan support, such as improvements in behavioral health care and aid to struggling rural hospitals, Woods said.

As leader of the region’s largest “safety net” hospital system, Woods offered assurance to anyone who’s worried about losing insurance. “We’ve provided care whether you had insurance or not before ACA, and we’ll continue to do it in the future.”