What Repealing and Replacing ObamaCare Could Look Like Under the Trump Administration
Republicans in Congress plan to repeal the Affordable Care Act (ObamaCare). Get the facts on a repeal and replace plan under the Trump administration and what it means for America.
What is the Patient Protection and Affordable Care Act (ObamaCare)?
- The Patient Protection and Affordable Care Act (PPACA, ACA, or ObamaCare for short) is legislation that was signed into law to reform the health care industry by President Barack Obama on March 23, 2010.
- The ACA contains key patient protections (like guaranteed coverage for preexisting conditions) and key affordability provisions (like cost assistance).
Repeal Attempts and What a Republican Replacement Plan Looks Like
- Republicans tried to repeal the Affordable Care Act over 50 times during the Obama administration. They did not offer a replacement plan that included both patient protection and affordability options alongside any repeal.
- There have been several Republican-led plans proposed over the years. These include the “Care” plan, the “Better Way” plan, Gov. Scott Walker’s Plan, Donald J. Trump’s Healthcare Reform to Make America Great Again plan, Burr, Hatch, Upton’s Obamacare Replacement Plan, Rep. Tom Price’s plan, Sen. Ted Cruz’s plan, etc. Most of these have attempted to lower cost assistance and to replace ObamaCare’s guaranteed coverage with an obsolete continuous coverage provision.
- Trump’s plan is in the vein of the past GOP plans but has some unique features. For example, he alludes to his intention to be tough on drug companies but does not provide any details.
- Republican plans also typically offer tax breaks to businesses, let insurers sell across state lines, eliminate the mandates, reduce people options for litigation, and expand HSAs. These provisions increase the deficit.
The Affects of a Repeal Plan – Coverage Affects and Cost Effects
- The amount a GOP plan increases the deficit differs by the plan proposed. Trump’s health secretary pick Tom Price’s plan was estimated to offer less coverage that we now have and cost $353 billion over 10 years, which is above what the ACA spends. All the plans listed above increase our national debt and that past CBO reports have pointed to a repeal increasing the deficit. See more about the costs of repeal.
Medicaid and Medicare Might be Repealed too
- 20 million people are covered under the Affordable Care Act’s coverage provisions. That number includes the employer mandate, the marketplace and cost assistance, Medicaid expansion, and children under 26 years old staying on a parent’s plan. Republicans have discussed repealing all of this, but some want to keep aspects of it. So 20 million people are at risk of losing coverage. More or fewer could lose coverage under a new plan over time.
- Paul Ryan has clearly stated that he wants to block-grant Medicaid and privatize Medicare. There are arguments for and against this, but the danger of his plan may turn our seniors into a commodity, which some would argue is what the Republican-led Part C and Part D did.
- The Affordable Care Act expanded Medicaid to all adults under 138% of the poverty level after a Supreme Court Case that allowed for it. However, 20 Republican-led states opted out of expanding Medicaid, leaving over 5 million people without any medical insurance options. These states now want money from a block grant so they can run independent Medicaid-like programs without Federal guidelines. There is no guarantee that they will use the money to provide adequate care to their poorest. They have not done so in the past.
What a Repeal Through Budget Reconciliation Looks Like
- A Republicans administration is likely to try to defund the Affordable Care Act in Trump’s first 100 days through budget reconciliation. They want to remove funds for the provisions that can be defunded.
- Aspects of the Affordable Care Act that can be changed through reconciliation include cost assistance, Medicaid expansion, and the individual and employer mandates.
- Aspects that would probably remain in place include guaranteed issue, the prohibition on pre-existing condition exclusions, modified community rating, essential health benefit requirements, and actuarial value standards.
- This could raise the cost of health insurance. Insurers would be forced to cover everything and follow ratios, but people wouldn’t have cost assistance.
- Why would anyone do this? This could break ObamaCare and ensure the GOP kept its “repeal ObamaCare” promise. Further, it could make people even angrier over the cost of medical insurance. The GOP could then sweep in with a marginally adequate plan and save the day, appearing to save America from the Democrat’s “broken” healthcare.
What Else Should You Know About an ObamaCare Repeal or Replace Plan
- Trump has stated that he will keep coverage for young adults under 26 and will keep preexisting conditions protections. However, he could be referring to the out-of-date versions of these provisions found in other GOP plans. In the past, Republican plans only allowed young adults to remain on their parent’s plan temporarily. More importantly, their preexisting conditions provision requires that you keep your medical insurance continuously until you hit Medicare age. If you become unemployed or sick, your preexisting condition may prevent you from getting the same coverage as everyone else.
- The GOP has said that it will provide a transition plan for the time between repeal and replacement. They haven’t been clear on specifics.
- The uninsured rate is at the lowest it has ever been under the Affordable Care Act.
- Young healthy people need to be in the market to keep everyone’s costs down. Repealing the mandates could mean tens of millions without coverage, and young people could easily make up a bulk of the group. Every sick person knows they must obtain and maintain coverage, but young people don’t have the same drive. Many blame the ACA for increased costs. However, the underlying cost of healthcare, covering the sick, and providing devices and pharmaceuticals are the largest cause of increased costs. If young people leave the market, but the sick stay, the chances that prices will stay level or go down are nearly zero.
- The ACA contains many provisions; only a few are ever discussed. It is unclear if the GOP seeks to dismantle the whole law, or if they plan to repeal only some provisions. See all PPACA provisions.
- The base healthcare costs that make up the foundation of our multi-trillion dollar healthcare industry have caused the cost of care to rise for everyone. Look at the stock market, pharma prices are booming, the health industry is healthy. Any meaningful reform must address this, not just offer handouts, decrease taxes, and then cut patient protections and affordable care to balance their new spending and tax cuts.
- Lastly, Republicans just passed “the Cures Act.” It has 1,000 pages of legislation. It is designed to seek cures and offer rewards to drug makers and device makers. It is essentially the ACA without its coverage provisions.It was passed with overwhelming bipartisan support, which strongly hints at just how political the whole “repeal ObamaCare” movement has become.
SUMMARY: There are some legitimate concerns about the Affordable Care Act. Individual costs are rising, and that is a problem that needs to be addressed. However, the ACA gets a lot right. Republicans and Trump have highly politicized the idea of repealing the ACA. Now they will have to tread very carefully to improve the program without pricing or legislating tens of millions out of coverage.Political peril of repealing, replacing ObamaCare.