No Honeymoon for Next President on Health Agenda

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By Alex Ruoff

Nov. 3 — The next president is unlikely to have a typical early-term honeymoon to help advance his or her health-care agenda in 2017, health policy experts told Bloomberg BNA.

Both Democratic nominee Hillary Clinton and Republican nominee Donald Trump have promised to take immediate action to either improve or repeal the Affordable Care Act. However, there’s little evidence federal lawmakers or the health industry will make it easy on either one.

The next president will face an uphill battle getting Cabinet members confirmed and getting his or her high-priority issues tackled by the next Congress, health policy advisers told Bloomberg BNA recently. But both are likely to use their executive powers and regulatory authority to advance their health agendas.

“It doesn’t matter who it is. The next president isn’t going to get a honeymoon,” Julius Hobson Jr., a senior policy adviser for Polsinelli PC in Washington, told Bloomberg BNA Nov. 2.

Fixing the nation’s insurance exchanges and taking action to stabilize costs for Americans purchasing insurance in the individual marketplace top Clinton’s health agenda. A full repeal of the ACA is foremost on Trump’s.

House Republicans, however, have pointed to passing a federal budget bill funding the government into 2017 as their highest priority after the national election. Senate Democrats have begun to focus increasingly on ways to lower prescription drug prices.

Clinton’s First Days

If Clinton wins, regardless of whether fellow Democrats reclaim control of the Senate, she would be unlikely to make any health-related issues her first priority, Jim Manley, a former spokesman for Senate Minority Leader Harry Reid (D-Nev.), told Bloomberg BNA. She probably will spend much of her first 100 days as president—and much of her political goodwill—fighting to get her Cabinet confirmed, he said.

“The confirmation process is a killing field now,” Manley, now director of communications practice for the Washington-based QGA Public Affairs, said.

Four high-level Health and Human Services Department positions, including the head of the Centers for Medicare & Medicaid Services and an assistant secretary for health position, are currently occupied by unconfirmed nominees because the Republican-controlled Senate has declined to confirm them.

Clinton’s health agenda includes support for a public option, a government-run insurance plan that would compete with private plans, and cutting tax breaks for drug companies for direct-to-consumer advertising. She has also vowed to make changes to reduce the rise in premiums for those in the individual market and to fully fund Medicaid expansion for holdout states.

The three central parts of the ACA—risk adjustment, reinsurance and risk corridors—will need to be fully funded and strengthened to improve the individual marketplace, Joel Ario, managing director of Manatt Health Solutions in Washington, told Bloomberg BNA.

Strengthening these parts of the ACA would likely require strengthening the individual mandate and increasing the amount of federal subsidies. It also would mean funding a reinsurance program that top Republicans have called a “bailout” for health insurers, Ario, formerly the insurance commissioner for Pennsylvania and director of the Office of Health Insurance Exchanges at the HHS in 2010 and 2011, said.

Expect Clinton to work quietly to strengthen the central parts of the ACA and to try to find compromises with Republicans in Congress, he said.

However, House Republicans have long fought against measures to support the ACA and have shown no sign of relenting during the presidential campaign, Hobson, formerly a lobbyist for the American Medical Association, said.

“They have no incentive to change what they’re doing,” he said.

Most major health policy changes would be likely to come from compromises on Medicare payment issues, namely changes to how physicians are paid and how Medicare pays for prescription drugs, Manley said. Republican and Democrats both agree that Medicare spending, particularly on prescription drugs, needs to be slowed.

Trump’s First Days

If Trump wins, regardless of who wins the Senate, he likely would take immediate action to undercut some of the central tenets of the ACA and to expedite the law’s demise, Diana Furchtgott-Roth, a senior fellow at the conservative think tank the Manhattan Institute and an adviser the Trump campaign, told Bloomberg BNA Nov. 3.

Trump would need to work with House Republicans to repeal the law’s mandate that all Americans have health insurance and requirements that all insurance plans include certain basic types of coverage, she said. Earlier this year House Speaker Paul Ryan (R-Wis.) promised to introduce a reconciliation bill to repeal the ACA if a Republican wins the White House.

Republicans, however, will need to be careful that their replacement for the ACA doesn’t disrupt coverage for the nearly 20 million Americans that gained insurance under the law in recent years, Ario said.

Expect Democrats to fight major changes to the ACA, particularly early in a Trump administration, he said.

Unclear is what Trump or Republicans in Congress would do about federal spending for Medicaid expansion.

Republicans want to make Medicaid a block grant program, but uncertainties remain around how to transition states that have expanded their Medicaid program with the help of federal funds to block grant programs similar to those states with smaller Medicaid programs, John McDonough, a professor in the Harvard T.H. Chan School of Public Health in Boston, said during a forum hosted by Harvard Nov. 3.

Even without action from Congress, Furchtgott-Roth said, Trump could undermine the individual mandate by asking his HHS secretary to loosen the hardship exemption of the mandate, effectively allowing anyone without insurance to be excused from the penalty. The head of the agency has the authority to define these hardships, including making them applicable to nearly everyone.

“Unwinding Obamacare will take thought and time,” she said. “That’s true of basically any law. It can’t be done immediately or unilaterally, but there’s things that could be done quickly.”

Any hope of lowering premium costs for those in the individual marketplace will end without the individual mandate, Hobson said. The Obama administration had hoped the mandate would push younger, healthy people to buy insurance to balance costs for insurers. Insurance companies make more money off healthy people who don’t use many health services.

The Future Head of HHS

The candidates’ agendas probably will guide who will head the HHS in 2017, current and former congressional aides told Bloomberg BNA.

Clinton’s short list to head the HHS likely includes longtime policy adviser Chris Jennings, former Massachusetts Gov. Deval Patrick (D) and Neera Tanden, president of the left-wing think tank the Center for American Progress, aides said.

With Clinton’s promise to improve the ACA, she could choose former Kentucky Gov. Steve Beshear (D), who led expansion of the Medicaid program in his state.

Beshear has been campaigning for Clinton in recent months but has “no expectation about this position one way or the other,” he said in a statement provided to Bloomberg BNA. A spokesman for Patrick declined to comment.

Trump’s short list is more difficult to identify, aides said. Michael Leavitt, who headed the HHS under George W. Bush, has been advising Trump’s presidential transition team. Bobby Jindal, former governor of Louisiana, has long been considered a popular Republican choice, but he backed Marco Rubio during the primaries.

During a campaign stop in Philadelphia Nov. 1, Trump said he hoped former primary rival and current supporter Ben Carson, a pediatric surgeon, would be “very much involved in my administration.”

Former House Speaker Newt Gingrich (R-Ga.) also has been mentioned as a possible next HHS secretary, Gail Wilensky, who directed Medicare and Medicaid programs under President George H.W. Bush, told Bloomberg BNA.

To contact the reporter on this story: Alex Ruoff in Washington at aruoff@bna.com

To contact the editor responsible for this story: Brian Broderick at bbroderick@bna.com

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