After GOP repeal failure, Democrats pitch ideas for Obamacare repairs
Senate Minority Leader Chuck Schumer, D-N.Y., said Friday that a number of his Republican colleagues have approached him to express their desire to open bipartisan negotiations since their latest attempt to repeal and replace the Affordable Care Act failed overnight.
Sen. John McCain, R-Ariz., who delivered an emotional speech earlier in the week on the need for bipartisanship and a return to regular order in the chamber, joined fellow Republicans Susan Collins, R-Maine, and Lisa Murkowski, R-Alaska, in voting against what lawmakers described as a “skinny repeal” of Obamacare.
The bill, released only two hours before the vote was scheduled, was written hastily by Republicans behind closed doors without Democratic input, the latest of many deviations from normal process in the Senate since January.
Schumer insisted at a Friday news conference that Democrats are prepared to work together if Republicans will drop their seven-year crusade to repeal former President Barack Obama’s signature legislative achievement and help repair it instead.
“Nobody has said Obamacare is perfect,” he said. “Nobody has said our health care system doesn’t need fixing. The problem was when they started, when they tried to pull the rug out from under the existing health care system. So change it, improve it, but don’t take a knife and try to destroy it and put nothing in its place.”
President Donald Trump has accused Democrats of obstruction and claimed they have no ideas to offer, but the minority party has offered many possible fixes for admitted flaws in the ACA in recent weeks.
“I think at the very beginning we should stabilize the system,” Schumer said Friday. “We should make permanent a cost-sharing which keeps people’s premiums down and keeps the counties that are covered up. We should look at reinsurance.”
House Minority Leader Nancy Pelosi, D-Calif., echoed those priorities at her own news conference Friday.
Experts say a permanent reinsurance program and a guarantee that cost-sharing subsidies will be paid would go a long way toward stabilizing the individual markets, and it is not too late to get them in place before 2018 premium rates are finalized.
“I think it would really help,” said Sandy Ahn, an associate research professor at the Center on Health Insurance Reforms at Georgetown University, although she quickly added, “I don’t know how politically feasible it’s going to be to get legislation to do that.”
Sara Collins, vice president for health care coverage and access at the Commonwealth Fund, said data on the temporary reinsurance program from the first few years of the ACA’s existence supports that conclusion. GOP critics have dismissed such payments as bailouts for insurers.
“We know from experience with the ACA reinsurance program that had a dampening effect on premiums,” Collins said.
According to Joe Antos, a resident scholar at the American Enterprise Institute, much of the current instability of the markets is a result of two errors Democrats made in crafting the ACA: they did not appropriate money for the cost-sharing reductions and they made the reinsurance program temporary.
“There’s no question that if Democrats had not made the mistake in the first place of putting in a reinsurance program that expired in three or four years, the markets would be much more stable today than they are now,” he said.
If you prohibit insurers from rejecting patients with expensive pre-existing conditions, something needs to be done to compensate them or premium prices will rise and healthy people will drop coverage.
“If you’re going to require a big expensive program that insurance companies are going to pay for, they have to get the money from somebody,” Antos said.
As part of their “Better Deal” agenda released this week, Democrats also proposed several steps they believe will reduce prescription drug costs for American families. First, they claimed allowing Medicare Part D to negotiate prescription drug prices with manufacturers could save billions of dollars.
“It kind of depends what that means,” said Jack Hoadley, research professor at Georgetown University’s McCourt School of Public Policy.
If all lawmakers did was free up the HHS secretary to negotiate, that may have little impact on prices overall. However, Hoadley pointed to a plan included in several of President Obama’s budget proposals that would create a rebate program for low-income Medicare patients estimated to save $140 billion over ten years as an approach with more impact.
Democrats called for the creation of a new federal agency devoted to preventing price-gouging by drug-makers, headed by an “enforcer” who would be independent and confirmed by the Senate. This office would investigate and punish drug companies that impose “unconscionable” prices on their products.
Drug companies would be required to justify significant price increases, and that information would be made public in an attempt to hold them accountable. The proposal cites several high-profile cases of seemingly ludicrous overnight price hikes on drugs that sparked public outrage.
Antos is skeptical that this public shaming and government intervention will resolve the issues causing drug prices to rise.
“Any proposal that says were going to create a new agency is probably not the proposal that’s going to solve a problem,” he said.
Earlier this month, a working group of House Democrats unveiled their own set of policy proposals. The New Democrat Coalition’s Affordable and Accessible Health Care Task Force laid out five goals for reform and their ideas for accomplishing them.
In addition to reinsurance and cost-sharing reduction payments, they called on the Trump administration and Congress to enforce the individual mandate to drive healthier people into market, which would slow the rate of increase of premiums. They also advised the administration to promote the exchange plans during the open enrollment period.
The coalition also suggested action by the federal government to make it easier for states to innovate and experiment. Alaska in particular has been successful in using waivers under section 1332 of the ACA to adapt its marketplace to the challenging conditions there.
Collins said the limitations of that option are spelled out in the law: the state cannot make changes that increase the number of uninsured or make coverage less affordable. There is flexibility to stabilize their own markets, though.
“The waivers are significant because they do allow states to make changes they need to make to their markets that might be unique to the state,” she said.
If the Republican repeal effort is as dead as it appeared Friday morning, Antos said use of the waivers could become much more common under the Trump administration. Administrator of the Centers for Medicare and Medicaid Services Seema Verma is a vocal proponent of letting states experiment.
“A lot of states have realized it’s going to be up to them to stabilize their own markets,” he said.
Pelosi has not fully embraced the New Democratic Coalition’s agenda, offering a somewhat tepid statement when it was released calling them “some promising ideas.”
The Democratic task force made several recommendations to create more affordable insurance options, including more tax credits and subsidies than are available under current law. They also suggested Congress should weigh expanding access to catastrophic plans that include essential health benefits to more young enrollees.
The coalition calls for extending Medicare eligibility to people who are nearing retirement age and want to enroll in the system. Democratic presidential nominee Hillary Clinton supported a similar policy during the 2016 campaign, allowing anyone over 55 to buy in.
Antos dismissed such a policy as a “shell game.” While it would succeed in moving some older, more expensive patients off of the exchanges and potentially lower premiums there, taxpayers would just end up picking up the burden instead.
“The cost of these people isn’t going to change,” he said. “It’s just going to shift over to Medicare.”
Commonwealth Fund expert Timothy Jost has also proposed requiring insurers who participate in the federal employee health benefit program to offer a plan in the bare counties that have no other options on the exchanges.
“These are potential fallback options for people in those counties to be able to have coverage,” Collins said.
Clinton’s 2016 platform also included a push to incentivize states to accept the ACA’s Medicaid expansion. Much of the drop in the uninsured rate since 2010 has been a result of states signing on to provide Medicaid coverage for more of their citizens. Many states with Republican legislatures and governors have refused, though.
At this point, experts see that as a political issue, and one that is essentially moot until there is a new president and a new congressional majority willing to promote expansion.
“There’s really nothing about the ACA that would make you think that states that have opted out so far will rush back in,” Antos said.
Floating somewhere on the periphery of the debate is the dream of many progressives, including some Democrats in Congress, to replace the for-profit insurance system in the U.S. with a government-run single payer program. Few see that as a plausible goal in the short term, though.
Which is not to say that the smaller incremental changes Democrats have put on the table are terribly likely to become law in the current partisan environment either. Schumer said Friday that he hopes McCain’s vote serves as a “turning point,” but Richard Arenberg, a former Capitol Hill senior staffer and co-author of “Defending the Filibuster: Soul of the Senate,” said that will require a complete jettisoning of the “repeal through reconciliation” approach Republicans have taken since January.
“If they can start from scratch in the Senate committees and use normal rules and they are willing to work outside of the rhetorical ‘repeal Obamacare’ framework, I think progress is possible,” he said.
Democrats would also need to make concessions, but if the talk of bipartisanship Friday from both sides is genuine, Arenberg believes common ground can be found.
“It can't be ‘repeal: take it or leave it,’” he said. “That's a non-starter and leaves the process mired in rhetoric. If they begin with hearings on how the Affordable Care Act can be improved and shored up, there's room for compromise-- at least for moderates of both parties.”
In the Senate, at least. Anything they pass would have to make it through the House, with its larger and more obstinate Republican caucus.
“The majority there seems unwilling to work with the Democrats,” Arenberg said. “If there is Democratic buy-in to a compromise in the Senate, that could provide an opening for GOP moderates to open up to Democratic moderates [in the House].”
“But we are a long way from there,” he added, “and I may be being a bit Pollyanna.”