Repeal, and then what?
GOP insurance plans face skepticism from advocates for poor
The 40 or so people grouped around tables in the Bessie Smith Cultural Center late last month were worried.
For some, the health insurance coverage they obtained under the Affordable Care Act was a literal lifeline for them and their children. Now Congress is working on its long-standing goal of undoing the law.
On the stage at one end of the room, a panel of local doctors, residents and health care activists were talking about what could happen. By some estimates, the repeal of the ACA could cost 526,000 Tennesseans their health care coverage.
“That’s 526,000 people showing up in your emergency room,” said Dr. Danielle Mitchell, a family and sports medicine physician in Chattanooga.
Things like high blood pressure or cholesterol, or being overweight, “anything you’ve seen the doctor for before becomes a pre-existing
condition,” Mitchell said. She asked how many people in the room would fit into that definition.
Nearly every hand went up. Republicans were against Obamacare from the start, calling it a huge federal overreach that didn’t work.
“We know what [President Barack Obama] promised did not come true in terms of keeping your doctor, your premiums going down, your deductible going down, your access [to health insurance] going up,” Republican U.S. Rep. Scott DesJarlais, a South Pittsburg physician, told The Tennessean newspaper in November.
“Even though some constituents say they like it and it’s helping them, it’s not sustainable and it’s going to have to be replaced.”
Now, the election of President Donald Trump means congressional Republicans can craft a replacement more to their liking. Many have said they want to preserve parts of Obamacare, particularly the provisions that people can’t be denied insurance for pre-existing conditions and children can stay on their parents’ plans until age 26.
After that, it’s pretty much a free-forall — witness the stunt Wednesday when Democratic lawmakers in D.C. claimed the plan was being worked on in a “secret room” and dashed all over the Capitol in a “treasure hunt” for the hush-hush legislation.
As for how to pay for whatever plan the GOP eventually settles on — and even that’s not a sure thing at this point — talk now focuses on four areas that could replace Obamacare premium subsidies: health savings accounts, tax credits, highrisk pools and allowing insurance companies to sell policies across state lines.
Proponents see those funding options as approaches toward controlling costs and increasing consumer choice, while opponents say they could leave the most vulnerable with higher costs and less — or no — coverage.
“The common denominator for all of these things is they assume that you have a great deal of money and resources,” said Gordon Bonnyman, staff attorney at the Tennessee Justice Center, a nonprofit that advocates for health care for the poor and underserved.
Health savings accounts let families set aside tax-sheltered funds to pay medical costs. But “if you’re working at a minimum-wage job, you don’t have a savings account,” Justice Center field director Katie Alexander said at the Feb. 23 forum in Chattanooga.
Added Mitchell: “If you’re supposed to save for your health care, you’re not going to get health care.”
High-risk pools sift out the sick from the healthy. The fortunate will enjoy lower premiums and better coverage, while the ill may face unaffordably high premiums and minimal coverage.
And setting one up from square one would be expensive, Tennessee Gov. Bill Haslam told the GOP leadership in D.C. earlier this year.
Haslam was responding to a request for state feedback on the health insurance and Medicaid issues in Tennessee. In a Jan. 6 letter to U.S. House Majority Leader Kevin McCarthy, R-Calif., Haslam noted the state phased out its high-risk pool when the ACA came in.
If Congress were to authorize those pools again, Haslam wrote, “We would be hesitant to stand up a new high-risk pool with only state resources and without assistance from the federal government.”
What Haslam wants is “meaningful relief from the federal constraints that exist today” in regard to policy benefits, insurance ratings rules and time lines for development of policies and rates, he wrote.
“Further,” he wrote, “we know costs must be addressed and reduced within the market so that a sustainable health care system may emerge for Tennesseans and all Americans.”
Tax credits are a tangle even among Republicans. For low-income people, direct credits against taxes owed don’t come close to covering the cost of family insurance coverage. And a large bloc of GOP conservatives are dead-set against “refundable” tax credits — which, like the Earned Income Tax Credit, actually return money to families — that they see as a costly new entitlement.
Bonny man jokes that the no-governments up port-for-health-care types and single-payer supporters“should form a Flat Earth Society and go off and debate each other.” But he’s serious when he says government is too heavily involved in financing and regulating health care to back off now.
“If you just want to blow that up and hope that when the pieces come down they form a whole, good luck with that,” he said.
“Government is in this up to its eyesockets. … Unless you’re willing to go back to an era of 75 years ago, and I don’t think anyone wants that, government is going to be here and going to be contributing. How do we do it in a way that’s efficient?”
For instance, he said, high-risk pools are hugely expensive to set up and administer. Why not just funnel more money into Medicaid — called TennCare in Tennessee — which has lower overhead and existing infrastructure?
But at least some Republicans in D.C. think Medicaid needs to get smaller, not larger. House Speaker Paul Ryan wants to switch the program from per-capita funding to a block grant. Ryan says states would have more control over their Medicaid programs, but opponents say he wants to cut funding by a third over 10 years, hurting the most vulnerable.
As for selling insurance across state lines, past attempts haven’t borne fruit, according to The New York Times. The main reason was the difficulty and cost of setting up new hospital and doctor networks in markets against existing competitors, the newspaper reported in 2015.
Ryan included the provision in his ACA replacement plan and President Donald Trump likes the idea. Ryan and other supporters say it would open up competition among insurers and encourage states to minimize regulations on the insurance industry to be competitive.
Opponents say that’s just the starting line for a race to the bottom, in both regulation and policy benefits. Bonnyman remembers when Tennessee was so notoriously lax on regulations it lost its accreditation from the National Association of Insurance Commissioners. At the same time, he said, any number of insurance companies failed in the state and left consumers unprotected.
“Would insurers go to the weakest state? Someone who believes in markets would expect that to happen, and we have a track record,” he said.
BlueCross BlueShield of Tennessee, the largest insurer and biggest player in the ACA insurance market in Tennessee, doesn’t favor the idea, said Roy Vaughn, senior vice president and chief communications officer.
“We’ll adapt if that’s in any legislation. However, we already compete against national competitors today and the single greatest factor determining the cost of coverage in a state is the cost of care,” Vaughn said in an emailed statement. “We believe in state-based regulation to ensure local knowledge and accountability for consumer protection.”
Tennessee’s Republican senators support switching from Obamacare to a GOP alternative. But they aren’t in the congressional group that wants to repeal now and replace at leisure
U.S. Sen. Lamar Alexander of Tennessee is chairman of the Health, Education, Labor and Pensions Committee, which will handle the ACA replacement bills. He has called for a measured process.
“Obamacare should finally be repealed only when there are concrete, practical reforms in place that give Americans access to truly affordable health care,” Alexander said in a January speech. “The American people deserve health care reform that’s done in the right way, for the right reasons, in the right amount of time. It’s not about developing a quick fix. It’s about working toward long-term solutions that work for everyone.”
Bonnyman praised that approach, saying health care comprises a complex galaxy of interwoven systems and processes that affect everyone.
“We’re all sitting in an airplane in flight; it’s not like we’re just watching from the bleachers,” he said.
Contact staff writer Judy Walton at jwalton@timesfreepress.com or 423-7576416.
“If you just want to blow that up and hope that when the pieces come down they form a whole, good luck with that.” – GORDON BONNYMAN, TENNESSEE JUSTICE CENTER