There's an interesting Q&A interview in Tuesday's Wall Street Journal with U.S. Sen. John Thune (R-S.D.) focusing on his criticisms of the Affordable Care Act. His comments raise doubts about how closely Thune, the third-ranking Senate Republican, follows healthcare developments. Here are some of the questions raised by his remarks.
1. Thune says government healthcare programs that pay providers fixed fee-for-service rates that are too low to cover their costs cause cost-shifting to private payers. That's a controversial proposition among health policy researchers, but plenty of knowledgeable people in the healthcare field attest to it. But then Thune goes on to say that the ACA has exacerbated this problem by expanding Medicaid.
What he doesn't seem to recognize is that most state Medicaid programs have shifted heavily to private managed-care plans, which establish their own payment rates to providers and are not bound to government-set fee-for-service rates. By year's end, it's estimated that 73% of beneficiaries nationally will receive services through managed-care plans, according to Avalere Health. And that shift is strongly supported by congressional Republicans, GOP governors and state lawmakers.
2. Thune argues that the ACA lacks incentives to reduce healthcare utilization, except for the so-called “Cadillac tax” on high-value plans. “If you have cradle-to-grave coverage, you're going to use the most expensive healthcare there is,” he said.
Hasn't he heard about the increasingly high deductibles and cost sharing in health plans sold on the ACA insurance exchanges, which many experts say have had a lot to do with reducing the use of both appropriate and unnecessary healthcare services? And according to many reports, the Cadillac-plan tax has prompted employers to increase cost sharing in their company plans as well.
3. Thune talks up congressional Republican proposals to repeal and replace Obamacare that focus on market competition and getting “people more involved in making decisions for their own healthcare,” including health savings accounts and allowing insurers to sell plans across state lines. (See my comments under #2.) The Affordable Care Act borrowed heavily from Republican ideas about engaging consumers in using healthcare services more thriftily—what conservatives like to call “having more skin in the game.” He doesn't acknowledge that.
In addition, Thune may not have heard that some states already have passed laws explicitly allowing insurers to sell plans in their states that have been licensed in other states. The problem is that few if any insurers have taken them up on this offer. A major roadblock is that insurers don't want to sell plans in markets where they have not established their own contracted provider network. In addition, states are not enthusiastic about allowing their residents to sign up for plans they don't regulate themselves.
4. Thune argues that, in expanding Medicaid eligibility, adding “even a small amount of cost sharing” would make the program “more effective, efficient and perhaps less costly to the taxpayer.” He advocates giving states more control and the ability to “tailor” their Medicaid programs.
Hasn't he heard that quite a few states, mostly led by Republican governors or with GOP-controlled legislatures, such as Indiana and Iowa, already have implemented “tailored” Medicaid expansion with cost-sharing requirements for low-income beneficiaries? And that's taken place under the hated ACA, and with the blessing of the Obama administration.
In addition, Thune surely must be aware that a number of his fellow Republican senators want to preserve the ACA's Medicaid expansion because it has greatly benefited their constituents, as well as hospitals and businesses in their states. They have told their fellow Republicans that they do not want to abolish the entire healthcare reform law.
Perhaps if Thune took a closer look at the overlaps between what he advocates and the real-world application of the ACA, he would rethink his statement earlier this month that “we need to make sure we get 51 votes to get Obamacare repealed.” Or perhaps it wouldn't make any difference.
