Repeal and replace is dead. Now what?

We are getting very, very close to retiring the ACA Deathwatch meme.

With last night’s news that two more Republican Senators won’t support BCRA, the Republican Repeal-and-Replace bill, efforts to kill “Obamacare” are dead.

Yes, there will be a move to pass a repeal only bill – they will fail, for the same reasons the BCRA died;

  • deep divisions within the Republican Party,
  • a keen understanding by many Senators that BCRA would crush their core supporters and lead to a revolt; and
  • Congressional Republicans have yet to make the transition from a party of opposition to a party of leadership.

I predicted this back in December, doubled down in May, and repeated that prediction after the House passed the AHCA. This wasn’t some amazing insight, rather a careful reading of the bill, and an understanding that taking something very valuable, very personal, and very important from people is political suicide.

So, what now?

Nothing much is going to happen with healthcare in Congress for some time.  That’s too bad, as ACA needs fixing – namely:

  • enforcement of the mandate;
  • guaranteed full funding of the Cost Sharing Reductions that help lower-income Americans pay deductibles and co-pays;
  • allow us older folks to buy-in to Medicare, thus reducing insurers’ risks

This would go a loooong way to giving certainty to insurers, certainty that would lower premiums and stabilize markets.

For now, my sense is Congress doesn’t want to hear smell see or taste anything healthcare-related for a long time.  There will be lots of politicking from the right about “Obamacare’s death spiral” and the left on GOP’s complicity in same.

What does this mean for you?

The good news is this horrible bill didn’t – and won’t – pass. 

The bad news is worse – nothing is being done about the core problem with US healthcare – it costs way too much.

 

ACA Deathwatch – Handicapping ACA repeal legislation

With Sen John McCain’s unexpected surgery delaying a Senate vote on the BCRA (Senate Republican ACA repeal-and-replace bill), here’s where ACA repeal stands.

Briefly, my take is Congress will not pass a repeal bill. So, the ACA Deathwatch clock’s hands turn back yet again

The core problem is the damned-if-you-do-or-don’t nature of the legislation.  By a 2-to-1 margin, Americans prefer “Obamacare” to the replacement

However, Republicans like repeal and replace. So, McConnell et al are stuck with a terrible choice – pass repeal and replace legislation that most Americans don’t want, or pass legislation that their base wants.

Add to this the strong support for ACA from several key Republican governors, and the fact that those most hurt by repeal would be core Republican voters; rural, white, lower-middle income folks, and the dilemma becomes knottier still.

A vote has been delayed indefinitely, allowing opponents – who grow more numerous by the day – to rally more opposition to BCRA.

What’s the future of repeal-and-replace? 

As of now, cloudy indeed, with a strong chance of dying with a whimper and not a bang.

What does this mean for you?

We’ll explore implications for workers’ comp of a non-vote on BCRA later this week – factoring in other legislative moves to slash Medicaid plus the non-enforcement of the mandate into our analysis.

The ACA lives on – good news for everyone

Especially congressional Republicans.

As of 4 pm on Tuesday, 9 Republican Senators have publicly stated they will vote against the Senate’s health care bill. While some want more dollars, care, and support, others want a complete repeal. This puts Majority Leader McConnell in an unwinnable position; everything he gives to the moderates upsets the hard-right Senators.

While McConnell continues to say they’ll vote on the bill after the July 4 recess, that’s unlikely.  He rammed it through in secret precisely out of fear that the longer it was in the public eye, the lower the chances for passage. Rest assured Senators will get an earful when they return home to do the parade thing.

While many Republicans will be assailed by hard-right activists for failing to deliver on “repeal and replace”, many are likely raising a toast to the gallows they just avoided.

There are two reasons for this. First, neither of the Republican bills would do anything to address the real problem – healthcare costs.  insurance costs are high in large part because healthcare in the US costs way too much and about a third of that spend is unnecessary.  So, if the bill had passed, it would have done nothing to keep costs low, and the Republicans would be getting the blame for higher premiums – as the Dems have since 2014.

More immediately, the House or Senate or some combination bill would have crushed core Republican voters – white, working class, generally older Americans. BCRA/AHCA would have led to sharply higher insurance premiums for many, while their poorer neighbors would have lost the Medicaid coverage they gained, if they are fortunate enough to live in a state that expanded Medicaid.

The average net increase for a silver plan under BCRA was, according to the CBO, 74 percent.

Older people – like me – would have paid much more than that.

And that’s why the glasses are clinking in the bars around Capitol Hill.

What’s next? Hopefully Republicans will allow Democrats into their discussions, so both parties can work on desperately-needed fixes to ACA. A great start would be telling insurers the Cost Sharing Reduction payments are going to happen. This would stabilize the current situation so they could start working on permanent fixes.

While that would be best for the country, I’m not sanguine about the likelihood that will happen. If Trump et al kill the CSRs, premiums will jump by a lot, and that could be the death knell for individual coverage.

What does this mean for you?

Here’s hoping Congress does some real live work for the people, instead of this symphony of dysfunction we’ve been witnessing for the past few years.

If it does, we’ll be in a whole lot better shape next near.

The Senate version of AHCA – What to watch for

Senate Republicans are set to release their revised American Health Care Act today – here’s what we know about their version, and what to watch for.

An excellent summary is here.

Medicaid – the biggest, most significant, and most important changes are to Medicaid.

74 million Americans are covered by Medicaid, and about 2/3rds of Medicaid funds go to elderly and disabled Americans.  Reportedly the Senate bill will:

  • eliminate Medicaid expansion funds over several years, and
  • significantly reduce future federal funding for Medicaid

As a result, more than 14 million low-income, disabled, and elderly Americans will lose coverage for nursing home care, rehabilitation, and all other healthcare services.

Individual and employer mandate

The mandate would be effectively repealed by eliminating enforcement. Today individuals and employers with more than 50 FTEs have to provide coverage or pay a penalty. Note – there has never been a requirement that employers with fewer than 50 workers provide insurance.

Insurance subsidies for lower-income Americans

The Senate version reportedly has preserved some of the current income-based subsidy provisions, unlike the House bill.

Pre-existing condition coverage

Cloudy would best describe what we know about the Senate bill’s approach to ensuring people with pre-existing conditions are covered. There just aren’t enough details, however even if pre-ex conditions must be covered, it appears insurers will be able to charge much higher premiums for those with pre-ex conditions, and/or exclude treatment for those conditions from their insurance policies.

Benefits

There are mandatory benefits in ACA; these would be eliminated in the Senate version, so your insurance plan might not cover mental/behavioral health and addiction coverage, and/or coverage for different types of care such as physical therapy or hospital services. While this provision would likely reduce premiums, it reduces coverage as well.

Tax changes and the federal deficit

All ACA-related tax increases are repealed with the exception of the Cadillac tax on high-value insurance plan, a change that will substantially increase the federal deficit.

Unforeseen implications – job loss

There’s been far too little coverage of one of the most important impacts of AHCA – the loss of close to a million jobs if this is signed into law. While employment would increase over the very-near term, over the next few years it will drop as fewer people have insurance and thus can’t get care.

What does this mean for you?

Millions of Americans will lose their health insurance, smaller hospitals will close, and cost shifting will explode as providers try to stay in business.

I don’t see the bill – in it’s current form – passing. But we are close to ACA’s death than we were a few weeks ago.

Why are Senate Republicans hiding their health care bill?

OK, let’s set aside the partisanship to objectively consider that question.

Senate Republicans are writing a bill in secret that would:

  • change one-sixth of our economy,
  • cause at least 20 million Americans to lose health insurance,
  • eliminate thousands of jobs in healthcare, and 
  • significantly change the insurance many of the rest of us have.

Many Republican Senators have yet to see the bill. HHS Secretary Tom Price has not seen the bill. The President has not seen the bill. The Wall Street Journal is upset with the process. The Conservative Review reports Orrin Hatch (UT), the second-highest ranking Republican Senator hasn’t seen the bill.

Senate Majority Leader McConnell has crafted a process to repeal-and-replace ACA that:

  • eliminates Senate requirements for debate,
  • doesn’t allow members of his own party or any Senate committee to review the bill before it hits the floor, and
  • avoids an accurate assessment by the Congressional Budget Office.

When ACA was passed back in 2009, there was:

  • 25 days of open public debate on the floor of the Senate
  • 13 days of open committee hearings
  • consideration of hundreds of amendments
  • months of meetings of the Gang of Six – three Republican and three Democratic Senators

Then-Minority Leader McConnell had this to say about ACA’s passage in 2009:

“This massive piece of legislation that seeks to restructure one-sixth of our economy is being written behind closed doors, without input from anyone, in an effort to jam it past not only the Senate but the American people…”

What does this mean for you?

Are you OK with this?

AHCA and the circular firing squad

Senate Republicans are not going to pass the AHCA.

Here’s why.

credit NYTimes

23 million Americans would lose their healthcare over the next decade.

14 million of those lose their coverage next year – an election year.

Anyone who’s been elected to the Senate is smart enough to know that taking benefits away from your core supporters is political suicide – and make no mistake, AHCA does precisely that.

Core Republican voters are those most hurt by AHCA; lower-income seniors would see their health insurance premiums explode, jumping almost ten times to $16,100.

But it’s not just about coverage – it’s about employment; healthcare systems, doctors offices, insurers and other businesses would shed 1.8 million jobs by 2022. These are well-paid positions, averaging well over $55,000.

That’s $99 billion in wages alone sucked out of the economy.

Here’s what I see happening.

Senate Republicans know they’re screwed if they pass AHCA as is. So, they may claim they’ve delivered on campaign promises to repeal-and-replace “Obamacare” by passing  some legislation – any legislation – that lets Republicans claim they tried to repeal “Obamacare”.

Then, when the House rejects their bill, the Republican Senate can blame it on House Republicans.

Doesn’t matter if you’re a Trump Republican or a Bernie backer, the cold hard political reality is there’s no way to lower premiums, cut budgets, and improve coverage. Anyone with any experience knew that, and knows that.

What does this mean for you?

The circular firing squad is forming.

 

What’s in the House version of AHCA?

Here’s the quick summary of the Republican bill. Lots of details here.

Net is the bill attempts to give states much more leeway in establishing and regulating health insurance policies and programs – sort of returning to the world we had pre-ACA.

While the bill was passed without a CBO evaluation/score, it is similar enough to the original bill. My guess is we could expect at least 15 million people will lose insurance coverage under this bill…but remember it’s not going to pass the Senate.

  • It replaces income-based subsidies (basing financial subsidies on a person’s income) with age-adjusted tax credits of fixed amounts.
    This means – wealthy and near-poor people of the same age get the same $ amount
  • Eliminates the individual and employer mandate
    This means – no requirement that people have health insurance.
  • Increases premiums for older people and reduces them for younger folks who get their insurance from small employers or in the individual market
    This means – more young people may sign up, more older folks will find insurance unaffordable
  • Ends funding for Medicaid expansion and caps future federal Medicaid payments
    This means – fewer low-income people will have coverage, states will have to come up with more money.
  • Penalizes individuals and families that don’t maintain continuous insurance coverage
  • Allows states to let insurers drop coverage for different types of medical care
    This means – consumers may not be able to get coverage for their condition or the type of care they need (e.g. drugs, behavioral health, maternity)
  • Eliminates taxes and tax increases from ACA
    This means – Medicare will run out of money in a couple of years instead of 10+

This is just what’s in the actual bill – which is already under fire by Senate Republicans; Portman, Heller, Graham, Scott, and Snowe have all voiced objections.

Instead of adopting or modifying the House Bill, expect an entirely new bill from the Senate. If the Senate bill is passed (which may – or may not – require 60 votes), then the House and Senate will have to figure out how to move forward and which bill is the vehicle.

 

 

ACA Deathwatch: No, AHCA is not going to pass Congress

AHCA is not going to become law.

IF it passes the House, there’s no way it gets enough votes in the Senate.  Two reasons.

  1. Senate Republicans are opposed to the bill.
  2. Enacting AHCA without massive changes would alienate core Trump voters.

Passing AHCA – without drastic changes – would be political suicide for politicians who voted for passage. And while pre-existing condition coverage is a big issue, the big issue is loss aversionmillions of Trump voters would lose coverage under AHCA.

The biggest winners – young, healthy people – don’t vote.

Oh, and AHCA keeps current ACA subsidies and protections for Congress and Congressional staff while chopping both for regular Americans

This from Nate Silver:

Republicans whose families make less than $30,000 a year were nearly three times more likely than those in families making at least $75,000 to say it was the government’s responsibility ensure Americans had health care coverage.

And from Jonathan Cohn – voters who stand to lose the most in insurance subsidies under AHCA are – by a wide margin – Trump voters…

Subsidy amounts lost by voters in 2016 election

AHCA drastically cuts assistance to older, lower-income Americans in rural areas, a demographic that overwhelmingly supported Trump. And, most of these voters earn too much to qualify for Medicaid, so they’ll be left:

  • with far lower subsidies
  • without coverage for pre-existing conditions
  • facing insurance premiums that are much higher than today’s because AHCA allows insurers to charge older folks much higher premiums.

Some may cynically hope AHCA passes as it will doom the GOP in the 2018 elections. But the cost of that political calculation is far too high; the millions will lose coverage are those most in need of healthcare coverage.

Of course, Congress won’t suffer – they keep subsidies, pre-ex coverage, and all the other goodies.

Congressional Republicans win; ACA repeal is NOT going to happen.

It’s official – Republicans’ efforts to repeal and replace ACA are done.

Finished.

Over.

And boy are they relieved!

I don’t know why anyone is surprised by this.  Only in the world of fantasy that exists inside the Washington Beltway would one think that changing legislation to appease far-right Freedom Caucus types wouldn’t cost votes from somewhat-more-moderate Republicans.

The latest defection is a big one – Fred Upton of Michigan said “I cannot support the bill with this provision (eliminating protection for individuals and small groups with pre-ex medical conditions) in it…”

What’s truly bizarre is this happened about the same time that Speaker Ryan was telling reporters “There are a few layers of protections for pre-existing conditions in this bill,”

Leaving aside the fact that the Speaker is wrong, think about the political implications for Republicans if they passed this legislation.  Their core voters in many states would find health insurance unaffordable, if available at all.

This isn’t liberal blather, it’s reality.  The best thing that can happen to Congressional Republicans is this bill isn’t going to pass.

And that’s before one contemplates the fate of the proposed bill in the Senate; if the House passes the AHCA repeal bill, their members will be hanging way out on a political limb as there’s no way the bill would ever get thru the Senate.

What does this mean for you?

Ignore the pundits.  AHCA is deader than this guy…

ACA Deathwatch – A Zero-Sum game

The ACA repeal movement may have gained a bit of momentum this week…The quick take – odds are this momentum will peter out as changes wanted by some Republicans are anathema to others.

My take is the hands on the Deathwatch Clock just moved back – not forward.

Here’s what’s going on.

The White House continues to push for a vote in the House by the end of this week, apparently to give President Trump a “win” in his first 100 days.

Hard-right Freedom Caucus Republicans have apparently agreed to a rough outline of a repeal plan. (details below)

Somewhat-more-moderate Republicans have publicly weighed in on the outline, and there’s a good bit of concern over coverage for pre-ex conditions and other provisions.

While the challenge faced by the Republicans is pretty straightforward, the solution is anything but. Put simply, changes that get support from the hard-right reduce support from more-moderate Republicans; It’s a zero sum game.

And that’s before it gets to the Senate, where it will die because Senate Republicans are loathe to pass anything remotely resembling AHCA.

Details on the latest legislation

Healthcare is brutally complicated, a reality that’s becoming increasingly apparent to GOP negotiators. To get to some sort of agreement between hard-rights and more-moderates, the latest repeal legislation includes:

  • waivers that allow states to set insurance premiums for older people 5 times higher than younger folks
  • ability for states to let insurance companies eliminate or limit coverage for different types of medical care – drugs, therapy, behavioral health, nursing home care, etc.
  • ability for insurance companies to “medically underwrite” individual and small group insurance again – in English, let insurers decide whether to cover you, and how much to charge, based on your medical history and risk factors.  To do this, states will have to provide high-risk insurance pools to help offset losses (this is a really complicated solution that hasn’t ever worked)

I won’t bore you with the nitty-gritty details, you can read them here.

What’s becoming increasingly apparent to Republicans in DC is they have a Hobson’s choice.

There is no way they can deliver on their campaign promise to repeal ACA and replace it with anything that won’t piss off a lot of their supporters.

But if they don’t repeal ACA, that will really piss off a lot of their supporters.

Add a President who doesn’t care what legislation does or doesn’t do, but cares a lot about “winning”, and we now understand why they are in the mess they are.

What does this mean for you?

The GOP has yet to transition from opposition to governing party.