Democrats Hit Back at Republican Health-Care Proposals

Stay ahead of developments in federal and state health care law, regulation and transactions with timely, expert news and analysis.

By Sara Hansard

Congressional Democrats Feb. 16 called for adding a public health insurance option to Obamacare markets and making subsidies more generous.

Speaking to about 600 people at an annual Washington conference held by Families USA, an organization that strongly supports the Affordable Care Act, Democratic members of Congress criticized Republicans for offering “failed ideas,” such as high-risk pools, to replace the ACA. A few hours later, former Obama administration officials also criticized Republicans for not being able to offer a replacement after years of calling for repealing and replacing the 2010 law.

Republicans are moving forward with their plans to repeal and replace the ACA, with the party’s congressional leadership presenting their members talking points of their plans. ACA supporters took aim at the proposals, saying they wouldn’t come close to covering the approximately 20 million people who have gained coverage under the ACA.

Republican Policy Brief

“There’s going to be a serious attack on Medicaid,” Sen. Debbie Stabenow (D-Mich.) told Families USA.

A policy brief circulated by Republicans includes repealing the ACA’s Medicaid expansion while funding the traditional health-care program for the poor with a per capita allotment and giving states the option of receiving federal Medicaid funding through block grants.

Turning Medicaid into a block grant to states in the past has meant funding cuts of 20 percent to 30 percent, “and most of the time there’s no requirement to use it on health care,” Stabenow said. The issue is a “very serious point of debate.”

Stabenow called for instituting a public option, publicly funded health insurance, in areas where there is little insurance competition, or enacting “Medicare for all, which is the other option.” That would expand the health-care program for seniors to everyone.

The Republican policy brief called for providing “state innovation grants” to fund high-risk pools for people with complex conditions. Before the ACA was enacted, 34 states had the high-risk pools, the brief said. The Better Way health-care plan of House Speaker Paul Ryan (R-Wis.) also called for using the state innovation grants to give states flexibility to lower the cost of care for high-need patients.

Returning to the system of state high-risk pools would mean “sick folks are segregated from the rest of the individual market and offered expensive and incomplete coverage,” Sen. Al Franken (D-Minn.) said at the Families USA conference.

In the past, many people couldn’t afford coverage in the high-risk pools, they faced a long waiting period to get coverage and “losses were so great that states often had to inject hundreds of millions” in state funds, he said.

Franken called for a public option and for making the ACA’s tax credit subsidies more generous.

Former Obama Officials Criticize Republican Plan

At a separate press briefing Feb. 16, three former Obama administration officials also attacked Republican proposals.

“None of the ideas we’re hearing would come anywhere close to replacing the ACA on coverage, quality or affordability, much less make things better,” Andy Slavitt, former acting administrator of the Centers for Medicare & Medicaid Services, said.

A vote by the conservative House Freedom Caucus earlier in the week for immediate repeal of the ACA appears to be “DOA [dead on arrival] in the Senate,” Slavitt said. Many Republican governors in states that have expanded Medicaid under the ACA, hospital executives and patient advocates don’t want to lose the coverage, Slavitt said.

“The Trump administration inherited a healthy market, and uncertainty over the mandate and repeal, along with actions like taking down advertising and outreach, are causing serious self-inflicted instability,” Slavitt said. The uncertainty “is making it very difficult for health plans to participate in the exchange,” he said.

2017 Increases a `One-Time’ Correction

Slavitt pointed to an S&P Global Ratings 2016 report concluding that the sharp premium increases experienced in the 2017 ACA marketplaces were likely a one-time correction as insurers initially priced their exchange products too low.

The Republican policy brief includes “advanceable and refundable” tax credits for people who don’t get insurance through employers or the government. The ACA provided income-related premium tax credit subsidies to make health insurance affordable for people who are required to have qualified coverage.

The Republican plan would turn the tax credits into a “flat amount” that isn’t related to income, Jeanne Lambrew, former deputy assistant to President Barack Obama for health policy, said at the press briefing. Under the plan, “If you have a one-time premium bump-up like we saw in 2017, the consumer, not the government, will bear the full brunt of that.” The primary reason people lack health insurance is because they don’t have a high enough income to afford it, she said.

The Republican plan also includes enhancing health savings accounts, tax-advantaged accounts tied to high-deductible plans that many conservatives believe would help restrain health costs by giving consumers more incentives to use care more efficiently.

To contact the reporter on this story: Sara Hansard in Washington at shansard@bna.com

To contact the editor responsible for this story: Kendra Casey Plank at kcasey@bna.com

For More Information

Information on Families USA's conference is at http://familiesusa.org/HA2017.

The Republican Obamacare Repeal and Replace Policy Brief and Resources is at http://src.bna.com/mh9.

Paul Ryan's Better Way health care plan is at http://abetterway.speaker.gov/?page=health-care.

S&P Global Ratings report, The ACA Individual Market: 2016 Will Be Better Than 2015, But Achieving Target Profitability Will Take Longer, is at http://src.bna.com/kZ1.

Copyright © 2017 The Bureau of National Affairs, Inc. All Rights Reserved.

Request Health Care on Bloomberg Law