Some liberal healthcare policy experts are urging an ambitious, costly program to expand and improve the Affordable Care Act's coverage. Meanwhile, conservative policy mavens are promoting an even more ambitious ACA replacement package they say would reduce the uninsured rate and lower healthcare spending with less government intervention.
Falling in between, the centrist Bipartisan Policy Center recommended last month that the Obama administration meet with governors to advance new health insurance approaches, including flexible use of the ACA's Section 1332 state innovation waivers allowing implementation of alternative coverage models.
These proposals represent efforts from the left, right and center to frame the health policy options for the next president and Congress following the November elections. Indeed, Democratic presidential candidate Hillary Clinton has proposed measures similar to those offered by the liberal reformers to make healthcare more affordable, while Republican hopefuls Jeb Bush, Marco Rubio and Chris Christie have borrowed ideas from the conservative experts.
“The smart players realize this isn't a healthcare election,” said Lawrence Jacobs, a political science professor at the University of Minnesota who studies healthcare politics. “But that doesn't mean you're not active preparing the ground for post-election discussions.”
The competing proposals come as enrollment on the ACA exchanges appears on track to exceed the Obama administration's cautious projection of 10 million, and the percentage of eagerly sought enrollees under age 35 has ticked up from the same period a year ago.
Nevertheless, both ACA supporters and opponents note that 10.5 million Americans who were eligible to buy subsidized coverage through the exchanges were still uninsured as of last fall, and that the law is moving much more slowly than predicted in achieving its goal of near-universal coverage. Last year there still were 29 million uninsured people, down from 45 million in 2013 before the ACA coverage expansion kicked in, according to the Centers for Disease Control and Prevention.
A big concern is high deductibles and other cost sharing that makes ACA individual-market plans unattractive, particularly for higher-income people who don't qualify for generous premium and cost-sharing subsidies. The New York Times reported that some people figure it's cheaper to pay the law's tax penalty for not buying coverage than buy a plan that doesn't offer any coverage until they hit the deductible that might be $3,000 or higher.
“It literally covered zero medical expenses,” said Tim Fescoe, an artist in Culver City, Calif. who last year dropped his and his wife's ACA plan that carried a $6,000 deductible.
Liberals who want to improve the ACA focus on reducing the cost-sharing burdens. A report published last month by Century Foundation, written by Tim Jost of Washington and Lee University and Harold Pollack of the University of Chicago, laid out a 19-point proposal for making the system better.
“People like me are very proud of the Affordable Care Act and see many things going well,” Pollack said in an interview. “But a lot of things aren't going well. What can we do to make sure the experience of using the marketplaces is more comprehensible and humane.”
His and Jost's proposal includes:
- Fixing the ACA's so-called family glitch so that working families qualify for exchange premium subsidies when an employer-based plan would be unaffordable.
- Increasing tax credits for moderate- to middle-income households that currently receive little financial aid in buying coverage.
- Reducing cost-sharing and out-of-pocket limits for moderate-income individuals and improving minimum coverage requirements in employer-based plans.
- Expanding the use of value-based insurance design to cover high-value services without cost-sharing.
- Strengthening state regulation and transparency of network and formulary adequacy.
- Beefing up consumer protection from balance billing.
- Standardizing insurance plans on the ACA exchanges.
- Having the federal government permanently assume the full cost of the ACA Medicaid expansion.
- Boosting Medicaid payment rates to ensure adequate patient access to care.
- Allowing exchange customers to buy into Medicare through the ACA exchanges, starting with people 60 and older
Conservative policy experts last month laid out their own sweeping plan for replacing the ACA, relying on consumer incentives and market mechanisms. While they want to do away with Obamacare, they write that “unless a credible and practical alternative reform plan is presented to the public, and supported by policymakers, the long-term trend toward ever-increasing governmental control will continue unabated in the years ahead.”
Their complex proposal includes:
- Capping the tax exclusion for employer health plans at the 75th percentile of employer plan cost.
- Providing age-adjusted tax credits to households without access to employer coverage.
- Eliminating ACA benefit requirements and allowing states to decide whether to retain public exchanges and what health plans could be offered.
- Replacing the ACA's blanket ban on pre-existing condition coverage exclusions with a guarantee of coverage to those who have maintained near-continuous insurance over the preceding three years.
- Giving states fixed, per-capita payments for Medicaid beneficiaries, and creating separate programs and funding streams for able-bodied and disabled recipients.
- Giving Medicaid beneficiaries tax credits to buy coverage in the private insurance market.
- Converting Medicare into a defined-benefit “premium support” program featuring private plans competing with traditional Medicare, and combining Medicare Parts A and B into a single program with one premium, and requiring beneficiaries with Medigap plans to pay a deductible.
- Greatly expanding use of health savings accounts.
- Abolishing the CMS Innovation Center and the Independent Payment Advisory Board, while giving providers and health plans greater flexibility in conducting tests of new value-based models.
- Sharply reducing federal support for graduate medical education.
- Paring down the Veterans Health Administration to focus only on essential services that aren't offered elsewhere.
House Speaker Paul Ryan (R-Wis.) recently vowed to unveil a Republican plan to replace the ACA on the heels of congressional Republicans pushing through ACA repeal legislation which was promptly vetoed by the president.
Republicans have been sharply criticized for failing to present their own reform plan. They are hobbled by sharp differences between various factions of the party. Some favor a comprehensive plan with tax subsidies to help people afford coverage, similar to the conservative policy experts' proposal described above. Others prefer a much more limited approach featuring Republican standbys such as limits on medical malpractice lawsuits, allowing insurers to sell plans across state lines, letting employers band together to buy insurance, and greater reliance on health savings accounts.
Despite the prodding from liberal and conservative reformers, the University of Minnesota's Jacobs predicts that neither Republican nor Democratic candidates will offer detailed healthcare proposals during this year's election campaign. The Democrats will avoid it because they don't want to open themselves to criticism about more costs and regulation. Their message is “consolidation and bite-size improvements” in the ACA. Meanwhile, he said, Republicans don't want to discuss specific plans with features that may resemble Obamacare and would alienate their political base.
After the election, even if the Republicans win the White House, “reality is staring them in the face, the world has changed, and going back (to the pre-Obamacare system) is not an option,” Jacobs said. Depending on the size of their victory, they may ratchet down premium subsidies and convert Medicaid into a state block grant program. But given healthcare industry and public support for many key ACA features, he predicted Republicans largely would be “relabeling aspects of Obamacare.”