Donald Trump's Pledge to Repeal Health Law Carries Risks - Wall Street Journal
Donald Trump’s goal of unraveling the 2010 Affordable Care Act could create problems for hospitals, insurers and drug companies that reworked their businesses around the law as well as for consumers who obtained coverage under it.
Mr. Trump has vowed to repeal President Barack Obama’s signature health legacy but offered little detail on his own plans to replace it. Republicans including House Speaker Paul Ryan have floated their own alternative solutions, though they lack a cohesive strategy for unwinding the law.
In one sense, Mr. Trump has a promising path to repeal the law given that Republicans retained control of the House and Senate in Tuesday’s elections. But he risks alienating millions of voters who could lose private insurance coverage or Medicaid if the law’s main planks disappear.
After six years, the health overhaul is largely implemented. The fourth open-enrollment period is currently under way and due to conclude Jan. 31. Many conservative health policy experts haven’t hid their disdain for Mr. Trump’s campaign, leaving open the question of who would provide the technical support for a dismantling effort.
In particular, Mr. Trump’s repeal could face opposition from Republicans in states that expanded Medicaid, the federal-state health coverage for low-income people, and industry groups that heavily profit from the law. Hospitals may be especially concerned about extra financial burdens because the number of uninsured patients would increase with a repeal.
Mr. Trump has promised to decrease regulation in the health industry, rework tax breaks for people who buy their own individual coverage and increase price transparency among health-care providers. His campaign cited a double-digit rise in 2017 premiums on the health insurance exchanges to rally support.
Republicans have already shown their determination to overturn the law, with the House voting more than 50 times to do so. They would have to tread carefully to avoid being seen as stripping coverage from Americans, including the nine million or so who get subsidies on the exchanges to help them afford their premiums.
Striking down the ACA would add as much as $350 billion to the federal deficit through 2025, largely because of the law’s measures that curb Medicare spending, according to the Congressional Budget Office.
“Full repeal of the health law would take a lot of political capital and occupy a fair amount of a Trump administration’s first term,” said Larry Levitt, a senior vice president at the Kaiser Family Foundation. “Republicans will have to pass something called ‘Obamacare Repeal and Replace’ but it might not end up being as far-reaching as people think.”
Speaking last week in Valley Forge, Pa., with Mike Pence, now the vice president-elect, Mr. Trump indicated a more detailed approach that includes a transition period for people who currently have coverage under the law and limited funding but more flexibility for the states in running their Medicaid programs. That could allow the 31 states that have extended Medicaid eligibility under the health law to retain their rules.
Mr. Trump could use executive and administrative actions to dismantle parts of the law. He could end an appeal of House v. Burwell, a lawsuit that claims the Obama administration spent money for cost-sharing subsidies to exchange enrollees that weren’t authorized by Congress. The payments reduce out-of-pocket costs on deductibles and coinsurance. Such a move could further undermine the stability of the exchange markets, which already struggle with rising premiums and insurer defections.
The individual mandate that requires people to have health coverage or pay a tax penalty also could be torpedoed.
Angst over repeal was already rippling through consumers who buy plans on the exchanges, with some taking to Twitter on Tuesday night to urge others to quickly make medical appointments to get care in case the law is overturned. Others worried about the loss of coverage they gained under the law.
Mr. Trump’s other goals include working with states to establish so-called high-risk pools of individuals who are sicker and more expensive to cover. And he wants a tax deduction for people who buy individual coverage.
He has also said he would foster greater competition by allowing insurers to sell policies across state lines, but this has run into obstacles when tried before. Insurers have had a hard time making inroads with providers and hospitals that already have networks formed with insurers in other states.
In addition, Mr. Trump has said he would encourage health savings accounts for individuals and Medicaid block grants to the states. He would be likely to borrow from the Republican health plan laid out earlier this year in a 37-page proposal from House Speaker Ryan.
The plan also calls for striking down the health law but would preserve some of the law’s requirements, including a ban on insurers dropping consumers if they get sick. The plan also would provide coverage guarantees for people who don’t obtain insurance through a job.
But it would end the ACA requirement that insurers offer coverage to people with existing health conditions. Striking that down could face resistance from Democrats and some Republicans since it has been seen as one of the most popular provisions of the health law.
Write to Stephanie Armour at stephanie.armour@wsj.com and Louise Radnofsky at louise.radnofsky@wsj.com
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