Health bill seems dead for this year, but changes are likely anyway in Medicaid and perhaps in private, subsidized insurance

By Al Cross
Kentucky Health News

What does the failure of the bill to repeal and replace the Patient Protection and Affordable Care Act, better known as “Obamacare,” mean for Kentucky?

Probably not much right away, but big changes are still likely next year in the Medicaid program, the expansion of which under the 2010 law had a much larger impact on Kentucky than reform of the private insurance market.

President Trump’s administration appears likely to approve major Medicaid changes for Kentucky and other states, following a model created for Indiana by a former consultant who is the new head of the federal Centers for Medicare and Medicaid Services.

The waiver requested by Gov. Matt Bevin last summer would allow the state to charge small, income-based premiums and require “able-bodied” Medicaid expansion members to work or pursue work unless they are a primary caregiver. The final waiver could include changes not originally proposed.

Kentucky’s Medicaid expansion, by then-Gov. Steve Beshear in 2014, has added about 440,000 people to the program whose household incomes are no more than 138 percent of the federal poverty level, about $34,000 for a family of four.

About 82,000 Kentuckians have federally subsidized health-insurance policies issued under the 2010 law. They are guaranteed coverage for the rest of the year, and Republican leaders have indicated that the issue is dead for the rest of 2017.

Many supporters of the failed Republican bill predict that subsidized insurance will become less affordable, and that “Obamacare is in a death spiral,” but the Congressional Budget Office said the individual insurance market is stable, at least nationally.

Counties in light blue have one Obamacare insurer; medium-
blue counties have two; dark-blue counties have three or more.

We will know more once insurance companies decide in two or three months whether they will offer policies on government marketplaces, and if so, in what counties and at what price. Almost half of Kentucky’s counties have only one Obamacare insurer, Anthem Blue Cross Blue Shield.

Though the Republican bill failed, the Trump administration has power to influence the success or failure of Obamacare, through regulations and policies. The president has said more than once that the best political course for Republicans would be to let the system collapse, forcing Democrats in Congress to seek changes in order to avoid more blame for it.

Trump has already undermined the system by saying the Internal Revenue Service won’t enforce the law’s requirement that almost every American obtain health insurance. His next step could be elimination of “cost-sharing subsidies the law provides to lower- and middle-income people with marketplace plans to help pay their deductibles and co-pays,” Amy Goldstein and Juliet Eilperin report for The Washington Post. “Those subsidies, which would have been erased by the House Republicans’ bill, are the subject of a federal lawsuit.”

Even if Trump doesn’t act, the prospect that he will make changes could further undermine the law, the Post reports: “According to health-care experts from across the ideological spectrum, an imminent question is whether the political tumult surrounding the ACA’s fate and the president’s talk of explosion could further shake the confidence of consumers and insurers alike. Doing so could prompt exits from the marketplaces.”

Trump’s political posture could become “a self-fulfilling prophecy,” said Andrew Slavitt, who was acting Medicare-Medicaid administrator for the last two years of the Obama administration. He told the Post, “That’s like inheriting an overseas war, and deciding you let your own soldiers get killed because you didn’t elect to enter that war.”

But Trump is unpredictable, and after the bill’s failure the White House signaled “that it may increase its outreach to Democrats if it can’t get the support of hard-line conservatives, a potential shift in legislative strategy that could affect drug prices,” reports Siobahn Hughes of The Wall Street Journal.

“Chief of Staff Reince Priebus brought up the idea of working with Democrats multiple times, leaving little doubt that the White House intended to send a message to the hard-line Republican flank,” Hughes writes. Interviewed on “Fox News Sunday,” Priebus said, “This president is not going to be a partisan president. I think it’s time for our folks to come together, I also think it’s time to potentially get a few moderate Democrats on board as well.”

However, Priebus’s view may not prevail, because more conservative Republicans and some Trump advisers are blaming him and his fellow Wisconsin Republican, House Speaker Paul Ryan, for the bill’s failure.

Several Democrats, including Beshear and U.S. Rep. John Yarmuth of Louisville, called for a bipartisan effort to improve the system. So did Republican Sen. Lindsey Graham of South Carolina. Senate Majority Leader Mitch McConnell of Kentucky didn’t respond to a request for comment on those remarks.

After the bill failed, McConnell issued a statement that did not look forward: “Obamacare is failing the
American people and I deeply appreciate the efforts of the Speaker and the
president to keep our promise to repeal and replace it. I share their
disappointment that this effort came up short.”

Most Kentucky Republicans in Congress endorsed the bill. The exceptions were Sen. Rand Paul and Fourth District Rep. Thomas Massie, who said it would have left too much of Obamacare intact.

Leave a Reply

Your email address will not be published. Required fields are marked *