WASHINGTON – With prospects in doubt for repealing “Obamacare,” some Republicans say the Trump administration can rewrite regulations and take other actions to undo much of the health care law on its own.
Some of those moves could disrupt life for millions of people, many in states that the new president carried. And then there’s the risk of court challenges. Remember the White House travel ban?
“In a world where Obamacare is not going to be repealed and replaced, do you work to try to make it succeed, or do you take steps to undermine it in order to continue blaming President Obama and the Democrats for the dysfunction of the health care system?” asked Nicholas Bagley, a University of Michigan law professor who’s analyzed the administration’s leeway to make changes. “Right now we don’t know the answer, and we are getting conflicting signals from the administration.”
The nonpartisan Congressional Budget Office recently concluded that insurance markets would probably be stable “in most areas” under the Obama-era Affordable Care Act, or ACA. But President Donald Trump has said “it’s imploding, and soon will explode.”
GOP congressional leaders, who had to pull their repeal bill, describe a multi-pronged attack on “Obamacare” that includes administration action. Democrats warn of “sabotage.” Enduring political turmoil is seen as contributing to insurers’ worries about returning to the health law’s markets next year.
Here’s a look at the pros and cons of some actions Trump could order:
Stop cost-sharing subsidies
In addition to subsidized insurance premiums, the ACA provides financial assistance for deductibles and copayments to consumers with modest incomes. House Republicans have challenged the constitutionality of aid payments, estimated at $7 billion this year.
A U.S. district judge in Washington agreed, finding that the law does not explicitly authorize such expenditures. The case is on hold by mutual consent of the House and the Trump administration. Insurers, who are legally obligated to provide assistance to qualifying customers, continue to be reimbursed by the government. That could end unless the legal issue is resolved.
Pro: For opponents of the ACA, stopping the cost-sharing payments would be the boldest step they could take short of outright repeal.
Con: Insurers would bail out or jack up premiums to make up for the loss of government payments. A market “death spiral” could begin in short order. “There’s a tension here for the White House between avoiding a crisis in the insurance markets and facilitating the collapse of a program they bitterly oppose,” said Larry Levitt of the nonpartisan Kaiser Family Foundation.
Officials won’t comment on pending litigation, but there doesn’t appear to be any policy change in the new administration.
Tweak insurance benefits
The ACA requires insurers to cover ten categories of “essential health benefits,” from prevention to prescriptions, maternity to mental health. While broad categories are written into law, key specifics are spelled out in regulations and guidance. The administration could propose changes.
Pro: It could bring down premiums for consumers who are comfortable buying less-than-comprehensive policies. That might entice more people into the market. “Every American ought to be able to purchase the kind of coverage that they want,” Health and Human Services Secretary Tom Price told Congress.
Con: Patient advocacy groups battled for the ACA’s required benefits and they’ll fight changes seen as harmful. “Essential health benefits are critical to assure access to what most people think is basic care,” said Mara Youdelman of the National Health Law Program. “If the administration attempts to get around the four corners of the law, we would certainly explore options for litigation.”
Alongside subsidized private insurance for people who don’t have job-based coverage, the ACA expanded Medicaid to serve millions more low-income adults. With the repeal effort stalled, some of the 19 states that have refused the expansion may come forward.
That gives the Trump administration an opportunity to steer an important program in a different direction.
Price and Seema Verma, Trump’s new head of Medicare and Medicaid, have told governors they are willing to consider a broad range of new Medicaid approaches, including work requirements. Verma also says she wants to improve health, not just treat disease.
Pro: States may gain more authority over a program that consumes major resources. The whole country could learn from individual state experiments. More low-income people may gain coverage.
Con: New requirements may discourage some from signing up. “The majority of people are working,” said Judy Solomon of the Center on Budget and Policy Priorities, which advocates for the poor. “For those who aren’t, it’s because of illness or caring for someone.”
Wink on insurance penalty
Tax penalties on people who remain uninsured are the most unpopular part of the Obama-era law. The Trump administration has already eased enforcement. The IRS scrapped a plan to hold up tax returns of people who fail to indicate if they have coverage.
Pro: If the tax man looks the other way altogether, it could win points for a president elected on a populist message. Some of those paying the fine are young people trying to get traction in life.
Con: Policy experts say the insurance penalty is essential for nudging healthy people into the market. And it remains the law.
Trump’s next move is uncertain. But a recent AP-NORC poll found that 6 in 10 Americans disapproved of his handling of health care. Blaming the Obama administration may not be a viable option much longer.
“If somebody can’t pay for their cancer medicine, they don’t want to hear you fulminate about how had Obamacare is,” said Bagley.
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