The American Health Care Act – we hardly knew ye.

What little most people knew about AHCA, they didn’t like, and they expressed that opposition loudly. Within the Republican House, some opposed the bill for watering down the Affordable Care Act (Obamacare) and rolling back its coverage increases. Others in the Freedom Caucus wanted Congress to repeal the law completely, something the Republican-led House and Senate approved in 2015 (Obama vetoed that bill).

Except for Anthem, the for-profit Blue Cross Blue Shield giant, few in the industry openly supported the AHCA bill. Physicians, hospitals, governors, and even the conservative Heritage Foundation came out against it.

With Democrats unified in opposition to repealing ACA, Speaker Paul Ryan needed to minimize losses within his own caucus for AHCA to pass the House and move to the Republican-led Senate, where it faced an even more uphill battle. Congressional opposition held firm and left the Republicans without the votes to pass AHCA on March 24. Ryan pulled the bill minutes before a planned vote and has no plans to resuscitate it. As Ryan said in his press conference, ACA is the law of the land for the foreseeable future.

Following the failed vote in the House, where does healthcare reform move under the Trump administration? The answer lies in the activities within the executive branch as well as possible smaller-scale legislation in Congress. After all, much of what passed in the Affordable Care Act could have been accomplished through rule-making from the Department of Health and Human Services and the Centers for Medicare & Medicaid Services.

The new administration and HHS Secretary Tom Price could loosen regulation. Price and CMS Director Seema Verma have encouraged states to seek waivers to restructure their programs. Such a move would likely lead to Medicaid expansion proposals with lower eligibility limits and work requirements for enrollees, both items the Obama administration rejected in waiver requests. While not a full-on block grant conversion, waivers and new regulations would accomplish some of what the AHCA sought to change in Medicaid. Individual states could seek waivers that shift to a block grant or per-member cap.

House GOP leaders have also signaled readiness to move on smaller initiatives. Rep. Greg Walden (R-Oregon) plans to focus on health insurance exchange markets and issues that could pull support from House Democrats. Chief among those issues is the reauthorization of the Children’s Health Insurance Program, which is one of the few healthcare issues with bipartisan support. It would likely sail through both chambers.

Stabilizing the health insurance exchange markets could be another avenue for bipartisanship. The exchanges in several states face severe challenges for 2018. With exchange options down in nearly every market and huge swaths of eastern Tennessee expected to have zero carriers in 2018, legislation that stabilizes the exchanges could draw some Democratic support.

AHCA would not have jettisoned the exchanges, and some form of fix will be on the House agenda. Insurers will almost certainly demand any legislation reform risk adjustment—the payments insurers receive for members with high claims—which could drive low-cost insurers like Molina Healthcare to leave that marketplace.

While AHCA is no longer a viable option, the industry should not take its eyes off the activities in the Trump administration and Congress. In those halls, the future of ACA and healthcare will be shaped in 2017.

 

To hear more on the evolving healthcare environment, attend our upcoming Webinar on June 27, titled “The Politics of U.S. Healthcare – Exchanges in the Trump Era.” Registration is available here (https://decisionresourcesgroup.com/events/webinar-series-politics-u-s-healthcare-exchanges-trump-era/).

 

This blog is part of a series of posts from DRG regarding the impact of the 2016 election on US healthcare. See our other blogs as they are added here (https://decisionresourcesgroup.com/tag/election2016/).

 

For more on the exchanges and healthcare, follow Bill Melville @BillMelvilleDRG.

 

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