Post Election Healthcare Perspectives and Possibilities
Written by Editor   
Monday, November 21, 2016 12:00 AM

 News Bite: The election early in November has cast uncertainty upon many things in the country, not the least of which is healthcare, health insurance, and how the federal government may interact with the states to "improve" healthcare.  President-elect Trump has outlined a seven point plan.  In the post-election period he has renewed a handful of pledges and plans for working with congress.  The president-elect also has several unilateral options outlined here.  Congress will also have several health related bills to take up early in 2017.  It looks as if 2017 will be predominantly healthcare related in both the Texas Legislature and the US Congress.

Prior to his election to the presidency of the United States of America Donald Trump provided a seven-point plan for healthcare.  These are described: 

  1. Seek to complete repeal Obamacare, eliminating the individual mandate.
  2. Modify existing law inhibiting the sale of health insurance across state lines.  As long as a purchased insurance plan complies with state requirements any vendor ought to be able to offer insurance in any state.
  3. Allow individuals to fully deduct the cost of their health insurance premium payments from their tax returns.  Review basic options for Medicaid and work with the states to ensure coverage for those who want healthcare coverage.
  4. Allow individuals to use Health Savings Accounts (HSAs) and make contributions to HSA be tax-free.  Allow any member of a family to use the HSA without penalty and allow them to accumulate and become part of the estate of the individual and passed on to heirs without fear of any death penalty.
  5. Require price transparency from all healthcare providers, especially doctors and healthcare organizations like clinics and hospitals.
  6. Use block-grants for Medicaid to the states providing incentives for states to seek out and eliminate fraud, waste and abuse.
  7. Allow drug providers of “safe, reliable and cheaper products” to import and sell drugs from overseas.  “Though the pharmaceutical industry is in the private sector, drug companies provide a public service,” Tump’s website noted.

After his election, Trump reiterated what he said on the campaign trail, in a new post on his “Great Again” website, President-elect Donald J. Trump said he will work with Congress to repeal the Affordable Care Act (ACA), replace it with a solution that includes health savings accounts, and return the role of regulating health insurance to the states.

The goal of the Trump Administration will be to create a patient-centered healthcare system that promotes choice, quality, and affordability with health insurance and healthcare and that takes any action needed to alleviate the burdens imposed on American families and businesses by the law, the document says.

“To maximize choice and create a dynamic market for health insurance," the Trump Administration plans to work with Congress to allow Americans to purchase insurance across state lines. The Administration also will work with both Congress and the states to reestablish high-risk pools, which President-elect Trump says is a "proven approach to ensuring access to health insurance coverage for individuals who have significant medical expenses and who have not maintained continuous coverage."

The problems with the US healthcare system did not begin with and will not end with the repeal of the ACA, the document states. Therefore, with the help of Congress and by working with the states, the Trump Administration pledges to do the following:

  • Protect individual conscience in healthcare;

  • Protect innocent human life from conception to natural death, including the most defenceless and those Americans with disabilities;

  • Advance research and development in healthcare;

  • Reform the Food and Drug Administration so as to put greater focus on the need of patients for new and innovative medical products;

  • Modernize Medicare so that it will be ready for the challenges posed by the coming retirement of the Baby Boom generation;
  • Maximize flexibility for states in administering Medicaid to enable states to experiment with innovative methods to deliver healthcare to low-income citizens.

Repealing the Affordable Care Act may remain difficult. Democrats still command enough power in the Senate to block the 60 votes needed for a full repeal. Republicans could use fast-track budget authority to make some major changes to the law, although that could take some time. In the short term, however, Trump could use executive power to make some major changes on his own.  When problems have arisen, Obama has often used his executive authority to try to solve them. And it’s this very mechanism Trump could use to undermine the law. As president, the Republican “can just reverse” Obama’s actions in many cases. A president can’t undo the basic architecture of the law, but can throw sand into the gears.

There are several measures Trump could take on Day One of his presidency to cripple the law’s effectiveness. Perhaps the easiest action — and the one that would produce the largest impact—would be to drop the administration’s appeal of a lawsuit filed by Republican House members in 2014. That suit, House v. Burwell, charged that the Obama administration was unconstitutionally spending money that Congress had not formally appropriated.  While help for consumers is required under the law, the funding was not specifically included. If Trump wanted to seriously damage the ACA, he could simply order the appeal dropped, letting the lower court ruling stand, and stop reimbursing insurers who are giving deep discounts to half their customers. And that would wreak havoc. The insurers would still have to provide the discounts, as required by law, he said, but they’re no longer getting subsidies from the federal government to cover the cost. So they are going to be selling insurance to these people way below the cost of that coverage. That would effectively shut down the health exchanges, because insurers would simply drop out. There is already some concern about the continuing viability of the exchanges after several large insurers, including Aetna and United HealthCare, announced they would be dropping out for 2017.
Another way Trump could undermine the health law would be by simply not enforcing its provisions, particularly the “individual mandate” that requires most people to have insurance. Aside from inflicting damage to the exchanges, the administration could also affect the law’s operations by refusing to approve states’ changes to their Medicaid programs. States rely on federal regulators to sign off on changes large and small, including which citizens are eligible, to keep their Medicaid programs operating. It is not whether Trump could single-handedly undo the health law, but whether he could undermine it enough to force Congress to take action. If Trump were to do just enough to cause the insurance exchanges to fail, he said, “that would put pressure on Congress … to reopen the law.”

Beyond the health law, Trump also could push for some Republican perennials, such as giving states block grants to handle Medicaid, allowing insurers to sell across state lines and establishing a federal high-risk insurance pool for people who are ill and unable to get private insurance.

Still, there are several health issues the next Congress and the new administration will be required to address in 2017, if only because some key laws are set to expire.  Those could provide a vehicle for other sorts of health changes that might not be able to clear political or procedural hurdles on their own.

Here are some of the major health issues that are certain to come up in 2017:

The Affordable Care Act

If the GOP could not repeal the law and Trump were to turn to Congress to address some of the issues associated with it, it’s not clear if the executive and legislative branches could work together. Nonetheless, some aspects of the law are unavoidable next year. For example, Congress in 2015 temporarily suspended or delayed three controversial taxes that were created to help pay for the law.  One of those taxes, a fee levied on health insurers, is suspended for 2017, while a 2.3 percent tax on medical devices was suspended for 2016 and 2017. Both industries lobbied heavily for the changes — arguing that the taxes boosted the prices of their products — and would like to permanently kill the taxes.

Also on hold is the most controversial health law tax of all, the so-called “Cadillac Tax” that levies a 40 percent penalty on very generous health insurance plans. The tax was technically put off from 2018 to 2020, but experts say pressure will begin to mount next year for reconsideration because employers will need a long lead time if they are to change benefits to avoid paying it. 

Children’s Health Insurance Program

The Children’s Health Insurance Program, a federal-state partnership is up again for renewal in 2017. CHIP covers more than 8 million children from low- and moderate-income households and has made a huge dent in the number of uninsured children. When the federal health law passed in 2010, many policymakers thought CHIP would quietly go away because most of the families whose children are eligible for the program became eligible for tax credits to help them purchase plans for the entire family in the health law’s marketplaces. But it turned out that CHIP in most states remained more popular because it provided better benefits at lower costs than did plans through the ACA.

In 2015, Congress compromised between those arguing to extend CHIP and those who wanted to end it, by renewing it for only two years. That ends Oct. 1, 2017. In practice, if Congress wants to extend CHIP, it needs to act early in 2017 because many states have fiscal years that begin in July and need lead time to plan their budgets.

Prescription Drug And Medical Device User Fees

Also expiring in 2017 is the authority for the Food and Drug Administration to collect “user fees” from makers of prescription drugs and medical devices.  The Prescription Drug User Fee Act, known as PDUFA (pronounced pah-doof-uh), was originally passed in 1990 in an effort to speed the review of new drug applications by enabling the agency to use the extra money to hire more personnel. The user fees were later expanded to speed the review of medical devices (2002), generic copies of brand-name drugs (2012) and generic biologic medicines (2012).

PDUFA gets reviewed and renewed every five years, and its “must-pass” status makes it a magnet for other changes to drug policy. 

Medicare’s Independent Payment Advisory Board

One more issue that might come up is a controversial cost-saving provision of the federal health law called the Independent Payment Advisory Board, or IPAB. The board is supposed to make recommendations for reducing Medicare spending if the program’s costs rise significantly faster than overall inflation. Congress can override those recommendations, but only with a two-thirds vote in each of the House and Senate.

So far the trigger hasn’t been reached. That’s lucky because the board has turned out to be so unpopular with both Democratic and Republican lawmakers, who say it will lead to rationing, that no one has even been appointed to serve.  The lack of an actual board, however, does not mean that nothing will happen if the requirement for Medicare savings is triggered. In that case, the responsibility for recommending savings will fall to the secretary of Health and Human Services. Medicare’s trustees predicted in their 2016 report that the targets will be exceeded for the first time in 2017.  That would likely touch off a furious round of legislating that could, in turn, lead to other Medicare changes.