Re­peal of ACA with­out ad­e­quate re­place­ment will drive se­vere dis­rup­tions be­yond in­sur­ance

Modern Healthcare - - COMMENT - By Dr. Ken­neth Davis and Ken­neth Raske In­ter­ested in sub­mit­ting a Guest Ex­pert op-ed? mod­ern­health­care.com/op-ed. View guide­lines at Send drafts to As­sis­tant Man­ag­ing Edi­tor David May dmay@mod­ern­health­care.com. at

Iseems that any post-elec­tion dis­cus­sion of health­care in the U.S. in­evitably leads to the cer­tainty that t Pres­i­dent Don­ald Trump will ask Congress to quickly re­peal and re­place the Af­ford­able Care Act, bet­ter known as Oba­macare. Some in Congress have sug­gested re­peal­ing first and then pass­ing a re­place­ment bill at a fu­ture date.

More than 22 mil­lion Amer­i­cans, in­clud­ing hun­dreds of thou­sands in our home state of New York, could lose their health in­sur­ance if Oba­macare is re­pealed with­out an ap­pro­pri­ate re­place­ment plan. Re­peal­ing with­out a si­mul­ta­ne­ous re­place­ment plan will also cause se­vere mar­ket dis­rup­tions, be­cause what in­sur­ance com­pany will want to stay in a pro­gram that has been re­pealed?

But the con­se­quences of re­peal­ing the ACA ex­tend far be­yond the in­di­vid­ual in­sur­ance mar­ket. Re­peal could also have enor­mous im­pli­ca­tions for state bud­gets and hos­pi­tal pay­ments. Jeop­ar­diz­ing any one of these im­por­tant things is trou­ble­some enough, but harm­ing all three si­mul­ta­ne­ously would se­verely strain the na­tion’s health­care de­liv­ery sys­tem.

For states like New York that ex­panded Med­i­caid cov­er­age (as other states red and blue alike have done), the ACA pro­vides en­hanced fed­eral Med­i­caid match­ing rates for adults with in­comes up to 138% of the fed­eral poverty level. The Ur­ban In­sti­tute es­ti­mates that if New York re­verted to pre-ACA Med­i­caid el­i­gi­bil­ity lev­els, its Med­i­caid spend­ing would in­crease by nearly $2 bil­lion in 2021. That amount would spike even higher if New York chose, post-re­peal, to keep its ACA ex­pan­sion pop­u­la­tion cov­ered.

Los­ing bil­lions in fed­eral health­care fund­ing will re­quire hard de­ci­sions. If New York and other states make the benev­o­lent but fi­nan­cially chal­leng­ing choice to keep in­di­vid­u­als cov­ered, they may be forced to raise taxes or cut health­care provider rates to pay for it.

Then there’s the hos­pi­tal com­mu­nity. The Amer­i­can Hos­pi­tal As­so­ci­a­tion es­ti­mates that strip­ping more than 22 mil­lion peo­ple of their health in­sur­ance would re­duce hos­pi­tals’ net in­come by $165.8 bil­lion over 10 years—a stag­ger­ing sum by any mea­sure. And hos­pi­tals are al­ready a leak­ing ship head­ing into a stormy sea. In New York alone, some 30 hos­pi­tals are so fi­nan­cially dis­tressed that they’re on a state “watch list” and in dan­ger of clos­ing. And many more in­cur sig­nif­i­cant losses ev­ery year. Re­peal will only make it worse.

While var­i­ous re­peal plans elim­i­nate the ACA con­tri­bu­tions paid by med­i­cal-de­vice mak­ers and in­sur­ance com­pa­nies, they do not re­peal the ACA’s many Medi­care cuts to hos­pi­tals meant to help fund the cov­er­age ex­pan­sions, in­clud­ing mul­ti­ple “pay for per­for­mance” penal­ties that dis­pro­por­tion­ately af­fect teach­ing and safety net hos­pi­tals.

By mea­sur­ing the im­pact of re­peal not just on in­di­vid­u­als, but also on state bud­gets and hos­pi­tal pay­ments, we see how truly vex­ing any re­peal at­tempt will be, and that un­in­tended con­se­quences lurk around ev­ery cor­ner.

The ACA is an ex­tremely com­plex law with myr­iad in­ter­con­nected parts. Re­peal­ing it is akin to dis­man­tling a large piece of heavy ma­chin­ery with dozens of in­di­vid­ual parts. Un­less you la­bel each in­di­vid­ual part, un­der­stand each part’s func­tion, and know ex­actly where each part goes when you put ev­ery­thing back, the re-as­sem­bled ma­chine won’t func­tion prop­erly.

There is no ques­tion that Oba­macare has its flaws, and that longterm im­prove­ments should be ex­plored in a thought­ful, bi­par­ti­san fash­ion. But we urge the Trump ad­min­is­tra­tion and Congress to not let the per­fect be the en­emy of the good—and the ACA has plenty of good in it.

Dis­man­tling the ACA with­out a re­place­ment that guar­an­tees cov­er­age for all Amer­i­cans who cur­rently have it would be an enor­mous step back­wards. And un­less the stated in­ten­tion of “re­peal and re­place” is to se­verely weaken the na­tion’s en­tire health­care de­liv­ery in­fra­struc­ture, a dis­man­tling that also harms state bud­gets and wors­ens hos­pi­tal pay­ments would be cat­a­strophic.

Dr. Ken­neth Davis, left, is pres­i­dent and CEO of Mount Si­nai Health Sys­tem in New York City. Ken­neth Raske is pres­i­dent and CEO of the Greater New York Hos­pi­tal As­so­ci­a­tion.

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