With the results of the election just beginning to sink in, many in healthcare are already wondering what changes are in store for our industry. President-elect Trump vows to repeal Obamacare and replace it with something much more affordable to consumers. But how would that look? Here are the top three plans that have been proposed to replace Obamacare.
This plan was initially proposed as a replacement for the ACA had the Supreme Court decision in King v. Burwell put a halt Obamacare in 2015. Senators Orrin Hatch and Richard Burr along with Rep. Fred Upton authored this comprehensive plan based on consumer reforms to the insurance market, modernization of Medicaid, as well as various changes designed to lower costs and increase choices. Some of the major provisions in this plan are:
- Insurance reform. The Patient CARE Act would repeal the individual mandate of ACA and replace it with a framework in which no one can be denied or charged higher premiums based on pre-existing conditions, as long as they maintain health insurance — with no gaps in coverage. It further allows dependents up to age 26 to be covered under their parents. States would be free to establish regulations that differ from the federal rules.
- Tax Credits. Individuals without the option of employee-sponsored healthcare insurance would be given a tax credit based on their income. Fixed credits would be issued to those who are elderly and persons earning income severely under the poverty line. States would be allowed to implement affordable insurance plans to cover those individuals failing to enroll. Federal funding would be made available for patients in high-risk demographics or who require more expensive care — to assist the state’s efforts.
- Defensive medicine. In addition to requiring more transparency on cost, quality, and outcomes it also encourages innovative reform in the area of litigation. Including use of expert panels, perhaps -- specialized health courts to settle cases quickly but fairly.
- Lead to lower health insurance premiums in all plan categories
- Lead to 4 million fewer enrollees by 2025 due to increased enrollment in the private market
- Projected to result in greater access to providers by 5%, by 2025
- Lead to 2% greater medical productivity (according to the H&E Medical Productivity Index)
- Decrease of the federal deficit by $534 billion between the years 2016 and 2025
In June 2016, Speaker Paul Ryan released a white paper entitled, A Better Way to Fix Health Care outlining the GOPs plan to replace Obamacare. This was the first proposal for an alternative to ACA endorsed by the Republican party leadership since the passage of Obamacare six years earlier. Although the paper illustrated a vision for reform, a full-scale legislative plan has not been issued. The intent, however, is clearly for all Americans have access to affordable health insurance and high-quality healthcare, though with less reliance on federal regulation and support. The major provisions outlined in Speaker Ryan's paper include:
- Consumer. Allows the consumer to direct their own healthcare choices. Users are given assistance via a refundable tax credit is based on age — not income. Access to coverage will be available for those without employer-sponsored plans. Consumers can extend coverage for dependents — up to age 26.
Encouragement of the use of health savings accounts (HSA) with fewer restrictions. Protection of self-insurance, group insurance, and stop-loss plans.
- Employer. Removal of regulations set by ACA that drive up costs for employers offering coverage.
- States. Allows states to rate insurance plans based on age, i.e., younger consumer access to lower-cost coverage. States allowed to be the primary regulators of plans. $25 billion to aid state’s in covering high-risk pools.
- Medicaid. Transition away from Medicaid expansion. Devise a fixed per-capita payments to Medicaid recipients based on four categories; elderly, children, disabled, and able-bodied adults. Give states the option to offer their own plan and opt out of Medicaid coverage. Offering States innovation grants for Medicaid reform.
- Medicare. Reform that restores supplemental coverage plans. Abolishment of the Independent Payment Advisory Board (IPAB) and Center for Medicare and Medicaid Innovation (CMMI). Promotion of competition in Medicare coverage market.
- Legal. Medical liability reform that reduces unlimited damage awards.
- Lead to 1 Million more insured individuals by 2018
- Lead to 4 million fewer insured by 2026
- Decrease in premium cost of private health insurance (unspecified amount)
- Increase in medical productivity by 7%
- Improves provider access by 4%
- Decreases the federal deficit by $481 billion between 2017 and 2026
3. Trump’s Stated PlanIn June of 2016, Donald Trump released a plan on his website, intended to replace the ACA. The proposal removes barriers to the sale of insurance across state lines and permits households to deduct the full amount of premiums from their taxable income. The ACA is entirely repealed and replaced by regulatory structures run by individual states that in effect rewind to pre-ACA regulations. Medicaid is funded by block grants to each state. It is assumed that the amounts of the grants will be based on actual Medicaid spending.
- Lead to 18 million fewer insured individuals in 2017 due to ACA repeal, Medicaid expansion and increase in number of privately insured —a result of tax credits
- Decrease in the cost of premiums for private health insurance
- Increase in productivity of 2% by 2026 relative to the current baseline
- Improved provider access by 11% by 2026
- Estimated decrease in the federal deficit by $583 billion.
The criticisms of The Trump Plan by the Center for Health and Economy are primarily directed at potential consequences. Since the individual mandate will be repealed the requirement of penalty to the uninsured will be removed. Some say this may eventually lead to increased costs since certain healthy people may forgo health insurance altogether, then later seek coverage should they become ill and require coverage.
In an article entitled, Day One And Beyond: What Trump’s Election Means For The ACA, Timothy Jost discusses what it will take for the Trump administration to succeed in a full repeal of Obamacare or what is more likely to occur — a compromise.
"A Trump administration is likely to work with conservative states to loosen remaining ACA requirements. Under section 1332 states can be granted ‘innovation’ waivers from many ACA requirements if they can provide similar coverage under their own proposals.”
With virtually every news organization reporting President-elect Donald Trump’s commitment to repealing Obamacare within his first 100-days, change is inevitable. Open for discussion and debate is just what those changes will be, how they will affect individuals/families, and our country's healthcare system.