Trump Sketches ACA Replacement Plan in Speech to Congress
Advocates Republican ideas including health savings accounts, Medicaid reform
by Joyce Frieden
WASHINGTON -- President Trump, during a speech to lawmakers on Tuesday evening, presented a broad outline of how the Affordable Care Act should be replaced -- incorporating many of the reform ideas traditionally offered by Republicans.
"Obamacare is collapsing -- and we must act decisively to protect all Americans," he told a joint session of Congress. "Action is not a choice -- it is a necessity."
The president began the Obamacare section of his speech by citing the plan's failures. "Mandating every American to buy government-approved health insurance was never the right solution for our country," he said. "Obamacare premiums nationwide have increased by double and triple digits ... One-third of counties have only one insurer and and they're losing them fast -- losing them so fast, and they're leaving, and many Americans have no choice at all."
"Remember when you were told that you could keep your doctor, and keep your plan? We now know that all of those promises have been broken," he said. "So I am calling on all Democrats and Republicans in Congress to work with us to save Americans from this imploding Obamacare disaster."
Trump outlined five principles that he said Congress should use in its legislation to replace the ACA:
- Ensure that Americans with pre-existing conditions have access to coverage, with a "stable transition" for those currently enrolled in the healthcare exchanges
- Help consumers purchase coverage using tax credits and "expanded" health savings accounts, "but it must be the plan they want, not the plan forced on them by our government"
- Give governors "the resources and flexibility they need with Medicaid to make sure no one is left out," said Trump
- Put in place legal reforms "that protect patients and doctors from unnecessary costs that drive up the price of insurance -- and work to bring down the artificially high price[s] of drugs, and bring them down immediately"
- Allow consumers to purchase health insurance across state lines -- which, the president said, "will create a truly competitive national marketplace that will bring costs way down and provide far better care. So important."
Still to come, though, is the legislation that fills in the details of how these goals would be accomplished.
Trump also mentioned a few other healthcare issues in his speech. During a section on making America a great country again, he said, "Heroic veterans will get the care they so desperately need." He also pledged to "stop the drugs from pouring into our country and poisoning our youth -- and we will expand treatment for those who have become so badly addicted."
Trump also criticized the FDA for its "slow and burdensome approval process." One of his guests at the speech was Megan Crowley, a 20-year-old woman with Pompe disease whose life was saved by a drug developed by a company her father founded.
"If we slash the restraints, not just at the FDA but across our government, then we will be blessed with far more miracles just like Megan," he said.
Former Kentucky governor Steve Beshear, who gave the Democratic response, criticized Trump's suggestions for ACA replacement. "Does the ACA need repairs? Sure it does," he said. "But so far, every Republican idea to replace the ACA would reduce the number of Americans covered, despite your promise to the contrary."
"These ideas promise access to care, but deny the importance of making care affordable and effective," he continued. "They would charge families more for fewer benefits and put the insurance companies back in control. Behind this is the idea that folks at the lower end of the economic ladder don't deserve healthcare -- that it's somehow their fault that their employer doesn't offer insurance, or they can't afford to buy expensive health plans."
"In 2010, this country made a commitment that every American deserved healthcare they could afford and rely on. We Democrats are going to do everything in our power to keep President Trump and the Republican Congress from reneging on that commitment, but we're going to need your help by speaking out," he added.
The Fight for Obamacare Has Turned
by David Leonhardt - NYT - February 28, 2017
The campaign to let 20 million Americans keep their health insurance is working.
It still has a long way to go, and it’s not guaranteed to succeed. But the progress of the last couple months is remarkable.
Thanks in part to a surge of activism — town hall meetings, online postings, calls to Congress — the politics of Obamacare have flipped. Many Americans have come to realize that the care part of the law matters much more than the Obama part. As a result, the Republicans no longer have a clear path to repeal.
President Trump, in his speech to Congress on Tuesday night, will probably pretend otherwise. He may repeat the same magical promises to pass a bill that’s better and cheaper and covers everyone. Privately, though, he and his aides have begun to realize the mess they have made by promising the impossible.
On Monday, Trump himself lamented that health care was “complicated.” The clearest sign of anxiety came in a Washington Post report: Four top advisers — Stephen Bannon, Gary Cohn, Jared Kushner and Stephen Miller — “have emphasized the potential political costs to moving aggressively.” Those costs include taking the blame (fairly or not) for every problem in the insurance market.
Meanwhile, congressional Republicans have their own troubles. As of now, they don’t have the votes to pass a plan.
Unable to agree on a policy, the party’s leaders have settled on what The Wall Street Journal called a “gamble” and a “dare.” They will push ahead with a now-or-never repeal bill, hoping that party loyalty will ultimately overcome substantive disagreements.
Why are Republicans suddenly having such a hard time agreeing about their No. 1 priority? They’ve run into two obstacles: reality and public opinion.
Let’s start with reality. Republican leaders are now paying the price for their dishonest approach to fighting Obamacare.
To be clear, there are honest conservative attacks to make on Obamacare. Republicans could have said that Americans who can’t afford health insurance aren’t entitled to it, just as people are not entitled to own a home. Or Republicans could have tried to alter the law — say, with less generous insurance plans.
But Republican leaders chose the easy political route instead. They blamed Obamacare (sometimes fairly, mostly not) for almost every health care problem. They’ve promoted the same fallacy for which conservatives often mock liberals: the free-lunch fallacy.
There is no free lunch on health care. Your health “costs” pay for my health “benefits,” and vice versa. If Trump promises a less expensive system, he is also promising to eliminate some care. He could cut wasteful care — and should — but Republicans caricatured the Obama administration’s attempts as “death panels” without offering their own steps.
Now that they’re running the government, free-lunchism has consequences. Their promise to scrap taxes on the wealthy, for example, leaves them without money to cover people. That’s why the independent Congressional Budget Office keeps concluding that the various Obamacare replacement plans would deprive millions of people of insurance.
More Americans have begun to understand these realities, and everyone engaged in the grass-roots campaign to protect health insurance deserves to take pride in the change. People have seen YouTube clips of town hall meetings at which members of Congress have no good answers. Some people are also starting to see through Trump’s wait-till-next-month timetable.
Most Americans still have complaints about Obamacare. So do I. (Some subsidies are too small, as are the penalties for not signing up.) But they increasingly realize that no serious alternative exists — still. Getting rid of Obamacare means taking away health insurance, and medical care, from millions of people.
No wonder the polls have flipped, and more than half the country now supports the law.
One group to watch is Republican governors. They met in Washington this weekend and tried to come up with an approach that would help their colleagues in Congress. But they couldn’t. Too many Republican governors understand that a repeal would create major trouble. To their credit, some aren’t willing to fake it.
Still, this is no time for complacency. Republicans have spent so long promising repeal that failure would leave them vulnerable to primary challenges and make them look weak. They have many incentives to pass a bill.
But aficionados of irony will appreciate the fundamental source of their struggles. In drafting his health care plan, Barack Obama chose a moderate, market-based approach. It was to the right of Bill Clinton’s and Richard Nixon’s plans and way to the right of Harry Truman’s — and yet Republicans still wouldn’t support it.
Many liberals regret that decision. Obama, for his part, believes that a more left-wing version would not have passed. Either way, the version that did pass doesn’t leave Republicans much room to maneuver.
Trump Concedes Health Law Overhaul Is ‘Unbelievably Complex’
by Robert Pear and Kate Kelley - NYT - February 27, 2017
WASHINGTON — President Trump, meeting with the nation’s governors, conceded Monday that he had not been aware of the complexities of health care policy-making: “I have to tell you, it’s an unbelievably complex subject. Nobody knew that health care could be so complicated.”
The president also suggested that the struggle to replace the Affordable Care Act was creating a legislative logjam that could delay other parts of his political agenda.
Many policy makers had anticipated the intricacies of changing the health care law, and Mr. Trump’s demands in the opening days of his administration to simultaneously repeal and replace President Barack Obama’s signature domestic achievement made the political calculations far more complicated.
Governors of both parties added still more confusion on Monday when they called for any replacement to cover all the people already benefiting from the landmark law.
“Of course I am concerned,” said Gov. Brian Sandoval, the Republican governor of Nevada, where about 300,000 people have gained Medicaid coverage. “I am someone who elected to expand Medicaid. That’s been very beneficial to my state, and I want to be sure those individuals can keep their coverage.”
“Governors are all in agreement,” said Gov. Terry McAuliffe of Virginia, a Democrat who is the chairman of the National Governors Association. “We do not want one single one of our citizens to lose access to quality health care. We are all unified on that. Actually, we want to expand, so everybody has access to quality health care.”
Mr. Trump brushed aside opinion polls suggesting that the 2010 health law was becoming somewhat more popular. “People hate it,” the president said, “but now they see that the end is coming and they’re saying, ‘Oh, maybe we love it.’ There’s nothing to love. It’s a disaster, folks.”
Because of the intricate procedures that govern budget legislation and the inherent complexity of health care, Republicans appear unlikely to undo the health law as quickly as they had hoped. Mr. Trump said Congress must tackle the Affordable Care Act before it can overhaul the tax code, also a high priority for Republicans. And those delays could slow work on other priorities like a billion-dollar infrastructure push.
“Statutorily and for budget purposes, as you know, we have to do health care before we do the tax cut,” Mr. Trump told governors.
After his session with the governors, Mr. Trump met on Monday with executives from health insurance companies. He apparently hopes they will stay in or return to the Affordable Care Act’s insurance marketplaces, where more than 10 million people obtained coverage last year.
If the governors’ meeting in Washington was supposed to clarify the future of the health law, it fell short. If anything, it exposed deep divisions among state executives, especially Republican leaders.
Gov. Gary R. Herbert of Utah, a Republican, said: “We did not expand Medicaid. Many states are divided on what the right approach is to take under the Affordable Care Act.” Some Republican governors, he said, are concerned about the “sustainability” of the Medicaid program, which covers more than 70 million low-income people.
And no governor was ready to say publicly that he or she could accept a replacement health law covering fewer people than the Affordable Care Act, which has extended coverage to 20 million Americans.
A bill drafted by House Republicans could cover fewer people. It would roll back the heath law’s expansion of Medicaid, eliminate tax penalties for people who do not have health insurance and end taxes imposed by the Affordable Care Act on certain high-income people, insurers, drug companies and manufacturers of medical devices.
To help people buy insurance, if they do not have coverage at work or under a government program, the bill would offer tax credits ranging from $2,000 to $4,000 a year, depending on age. But the credits would not fluctuate with a recipient’s income, raising the prospect that insurance might be less affordable for lower-income people. The House Republican bill would also eliminate minimum federal standards for “essential health benefits,” and it could require some people with particularly expensive employer-sponsored coverage to pay taxes on some of its value.
The emergence of that draft has produced cries of opposition among Democrats and nervousness in some Republican quarters. Conservatives added their objections on Monday, saying the tax credits could become a permanent entitlement. Representative Mark Walker of North Carolina, the chairman of the conservative Republican Study Committee, said he could not vote for the bill in its current form because it could create “a new health insurance entitlement with a Republican stamp on it.”
Mr. Herbert said he could support the Republican proposal to give each state an allotment of federal money with a set amount for each Medicaid beneficiary — what he and other officials described as a per capita cap. Some experts believe that could be “the best thing for us to do in Utah,” Mr. Herbert said.
But Democratic governors generally oppose efforts by congressional Republicans to give each state a fixed allotment for each beneficiary or a lump sum, known as a block grant, for its entire Medicaid program.
“Block grants or per capita caps would throw state finances into disarray” and shift costs to the states, Democratic governors said in a letter to congressional leaders.
Two House committees may try to vote next week on legislation to repeal the Affordable Care Act and put in place some elements of a replacement. But the disagreements among Republicans, in the Trump administration and on Capitol Hill, suggest a difficult road ahead.
In recent days, some senior White House officials have come to believe that the timetable House Republicans have laid out for the health care overhaul is overly ambitious, said one person who has been briefed on their thinking, given the apparent public opposition to what is known of the plan already and the likelihood that an independent cost-benefit analysis could make it even less attractive to low-income voters.
If the House plan fails, these officials may introduce a White House version of the repeal-and-replace legislation later in the year, with the hope that it will be better received, added the person briefed on the matter.
Gary Cohn, the director of the president’s National Economic Council, and his staff have spent significant time studying the Affordable Care Act and its weaknesses. Mr. Cohn and Jared Kushner, the president’s son-in-law and a senior adviser, have emerged as skeptics of the plan being developed by House Republicans, said the person briefed on the matter. The White House had no immediate response to a request for comment.
The White House chief of staff, Reince Priebus, is more aligned with the House speaker, Paul D. Ryan, and the secretary of health and human services, Tom Price, who are championing the current repeal-and-replace bill.
Mr. Trump’s Treasury secretary, Steven Mnuchin, said as recently as Thursday that the administration hoped to pass tax cuts for both businesses and middle-class Americans in time for Congress’s recess in August. But since health care must be addressed first, tax legislation could easily be pushed into 2018, according to members of Congress and administration officials.
GOP’s New Plan to Repeal Obamacare: Dare Fellow Republicans to Block Effort
GOP lawmakers gamble that setting bill in motion to strike Affordable Care Act will help break through intraparty disagreements
Republicans came into office this year promising to rescue Americans from rising healthcare bills by repealing and replacing the Affordable Care Act.
But the party’s emerging healthcare proposals would shift even more costs to patients, feeding the very problem GOP politicians complained about under Obamacare.
And their solutions could hit not only Americans who have Obamacare health plans, but also tens of millions more who rely on employer coverage or on government health plans such as Medicaid and Medicare.
House Speaker Paul D. Ryan (R-Wis.) and other congressional leaders, as well as new Health and Human Services Secretary Tom Price, favor bringing back slimmed-down health plans that were phased out under Obamacare. Such “catastrophic” plans typically offer fewer benefits and often require patients to pay much larger deductibles.
Many in the GOP also want poor people who rely on Medicaid to face more co-payments and higher premiums, citing the need for patients to have “skin in the game.”
Developing House Republican plans to replace Obamacare would scale back government insurance subsidies for millions of low- and moderate-income Americans who rely on the aid to buy coverage.
To fund a healthcare overhaul, Republicans are exploring ways to scale back tax breaks on health insurance, a move that could mean a tax hike for people who get coverage through an employer.
Meanwhile, other GOP plans to overhaul Medicare — which Ryan and Price have championed — would provide seniors with vouchers to shop for commercial health plans, an approach that independent analyses suggest could leave many patients paying more.
Those are politically risky ideas, said Robert Blendon, an authority on public attitudes about healthcare at Harvard University. “Skin in the game has been never popular,” he said. “It may be an economist’s dream. But it’s never been something people say they want.”
The GOP proposals — many bedrock conservative healthcare ideas — also could prove a major obstacle as Republicans labor to convince increasingly skeptical Americans that they have a better alternative to Obamacare.
Republican leaders like Ryan contend their ideas will transform healthcare markets across the country as government regulations are pared back, driving down costs.
“We believe in a patient-centered system, where individuals have the freedom to buy what they want and not what the government makes them buy,” Ryan told reporters at the Capitol recently. “It's really, really important to have choice and competition in healthcare because choice and competition lowers cost and increases quality.”
GOP lawmakers have tapped into fertile ground with their relentless attacks on rising costs. Though insurance premiums are generally increasing more slowly than they had in the past, many consumers are still seeing steep increases even as their deductibles also balloon.
The increases have been particularly dramatic on the insurance marketplaces created by the healthcare law, which serve only about 11 million people but have become the law’s most visible program.
This year, the average annual deductible for a silver plan for a single adult on the marketplaces hit $3,572, according to a survey by HealthPocket, an online insurance shopping tool.
Most experts believe high healthcare costs are being driven primarily by the high price of medical services in the U.S.
The average cost of a hip replacement, for example, is nearly twice that in Switzerland or Britain. Many brand-name pharmaceuticals cost two or three times what they do in other industrialized countries.
But most GOP proposals focus on getting patients to pay more out of their own pocket for medical care as a way to control rising premiums.
A favorite Republican strategy is to increase use of high-deductible health plans, coupled with tax-free health savings accounts, or HSAs, which consumers can use to set aside money for medical expenses.
“HSAs tied to high-deductible health plans are popular tools that lower costs and empower individuals and families,” House Republicans said in their “Better Way” blueprint for replacing Obamacare.
Under current law, high-deductible plans can require single people to pay as much as $6,550 before their insurance kicks in. Families can face deductibles as high as $13,100.
Consumers who have qualifying high-deductible plans can put aside as much as $3,400-a-year in a health savings account, or $6,750 of they have a family health plan. Many Republicans favor allowing Americans to put away even more in these accounts.
Republicans similarly favor more cost-sharing in government safety net programs, such as Medicaid.
The federal government historically has limited how much state Medicaid programs can charge poor children, pregnant women, and elderly and disabled patients for medical care.
Trump has said he has no plans to alter Medicare, but senior officials in the Trump administration, including the vice president, helped pioneer broader use of premiums and co-pays for Medicaid patients in Indiana. Many in the GOP would like to see this approach broadened nationally, including the woman Trump has tapped to oversee the federal Medicaid program. Seema Verma also worked in Indiana.
Price, Trump’s Health secretary, has also called for changes to the Medicare programthat could hit seniors with higher medical bills through a practice called balance billing, which allows physicians to collect a surcharge from patients beyond Medicare’s fees. Balance billing is currently prohibited.
Even as Republicans envision patients paying a larger share of their medical bills, many GOP leaders are also calling for cuts in federal aid to help Americans pay their insurance bills.
Among other things, congressional Republicans are discussing plans to scale back subsidies made available by Obamacare that help about 8 million Americans buy health coverage on state insurance marketplaces created by the law.
These subsidies are linked to consumers’ incomes, with much more aid available to poor people. If the system is changed, millions could see their insurance premiums jump.
The effect of such cuts would be limited to the small fraction of Americans who rely on the marketplaces.
But Republicans are also eyeing changes that could affect health insurance costs for a growing share of the roughly 150 million people who currently get coverage through an employer.
Under plans being discussed by House GOP leaders, the federal government would scale back the tax break that employers and workers get on health benefits. For decades, health benefits have not been subject to income taxes or payroll taxes.
Changing that could make health insurance more expensive for many workers and families, and disrupt a highly popular system. In one recent survey, more than 8 in 10 Americans rated their employer-based coverage as excellent or good.
The GOP plans to shift costs to patients with high medical bills and less government aid are already generating skepticism among many experts, who question whether most Americans will be able to put aside more money to pay for their healthcare.
Nearly 70% of Americans in one recent survey reported having less than $1,000 in savings.
At the same time, it’s unclear that loosening government regulation of health insurance will produce the substantially cheaper health insurance that Republicans have promised.
“There is this assumption that premiums will fall a lot,” said Len Nichols, a health economist who heads the Center for Health Policy Research and Ethics at George Mason University. “I think they are going to be disappointed.”
Most immediately, GOP leaders face a more serious political problem of convincing Americans of the merits of their strategy. “Nobody ever says they want to spend more on their healthcare,” Harvard University’s Blendon said.