Repealing Health Care Law Would Mean Higher Costs
Kelly Kennedy, USA TODAY
WASHINGTON — Republicans may not agree with President Obama’s State of the Union call to drop the idea of repealing the Affordable Care Act, but health experts say the law has taken such hold that it may be impossible to get rid of it.
The consequences of repeal, health care officials and industry analysts say, go beyond the fact that 9 million people would suddenly lose their insurance or that anyone with a pre-existing condition would either lose insurance or pay much higher premiums.
All consumers would take a huge financial hit, because health care costs would continue to rise, and insurers would probably recoup their losses by charging higher premiums.
Repeal “was a 2012 issue — if the Republicans had won both the House and Senate and the White House,” said Gail Wilensky, an opponent of the law and the former Medicaid program director under President George H.W. Bush. “It’s here to stay.'”
Even a proposal by Senate Republicans issued last week includes many of the law’s key elements.
Wilensky remains opposed to many elements of the law and calls the “screw-ups” surrounding the launch of the HealthCare.gov website Oct. 1 “mind-numbing.” But people need health coverage, better health care and lower costs, she said, and the priority should be fixing problems with law, not throwing it out.
Repeal would be “cataclysmic,” said Ezekiel Emanuel, a University of Pennsylvania bio-ethicist and one of the architects of the law. “There are probably north of 12 million who have gotten coverage,” he said. “You repeal this, and they’re all going to be hurt.”
That includes the 3 million people who have enrolled in private insurance through the exchanges, 6 million who have enrolled in Medicaid and millions more people younger than 26 who enrolled in their parents’ insurance.
Beyond providing insurance coverage to those who didn’t have it, the law contains provisions aimed at saving money throughout the health care system, Emanuel said. Those, too, would be lost with repeal. They include:
- A requirement that insurers clearly and quickly show exactly what is in a policy and how much it will cost the consumer to use.
- Accountable Care Organizations, a program that moves providers from fee-for-service payment systems to payments based on quality and savings. Thursday, the government announced those groups saved Medicare $380 million in their first year of operation.
- Incentives and requirements for providers to use electronic medical records to better track care as well as determine potential savings.
- Explanations by insurers for big premium increases.
- Penalties for hospitals if Medicare patients are readmitted within 30 days of a hospital stay for preventable ailments, such as infections or pneumonia. That is aimed at forcing hospitals to keep patients from landing back in the hospital when they can get less expensive treatment at home.
- Increased competition through federal and state health exchanges, which allow consumers to make direct comparisons of health plan costs and benefits.
In addition, children insured before the law who had their Children’s Health Insurance Program funding expanded because of the law would lose coverage.
“If you repeal the ACA tomorrow, the CHIP would actually then expire,” said Bruce Lesley, president of First Focus, a bipartisan advocacy group for families. “So overnight, there’s 8 million kids who would be gone.”
IMPACT ON INSURERS
Insurance companies, which are required to cover higher-risk customers, would lose money through repeal, said Alan Cohen, chief strategy officer for Liazon, which provides health exchanges to private employees.
“You think that somebody who works for a major Fortune 500 company thinks it doesn’t matter, but it does,” Cohen said. “The health plans who are taking that risk are the same ones that insure all of the people in this country.”
The insurers have invested a lot in the law, and if they lose money through repeal, it could cause everyone else’s premiums to go up, Cohen said. And if those premiums go up significantly, or, worst-case scenario, the insurers were to go bankrupt, it could lead to more changes.
“It would increase the case for national health insurance,” he said. “I think that could increase the call: Medicare for all.”
As the White House has learned from the experience of having up to 5 million people have their old health insurance policies canceled because they didn’t meet the law’s requirements, people do not like having their insurance change. Taking away the coverage of millions of people through repeal would be a similar political disaster for Republicans, said Ben Sommers, assistant professor of health policy and economics at the Harvard School of Public Health.
“They clearly would lose out, and you would have an unprecedented action by Congress to take away access to coverage,” Sommers said.
Bob Moffitt, a senior fellow at the conservative Heritage Foundation’s Center for Policy Innovation, said any repeal would have to be followed by a new law that includes many similar elements. Those include health insurance plans for those with pre-existing conditions and the ability for people to keep insurance purchased through health exchanges.
Moffitt cited the recent proposal from Republican Sens. Richard Burr, Orrin Hatch and Tom Coburn as a way to maintain those benefits.
Their proposal would eliminate the subsidies that allow people who make less than 400% of the federal poverty level to help pay for their insurance. One way to compensate for the lost subsidies, Moffitt said, would be tax credits because the law’s subsidies “cut out an awful lot of the middle class.”
States could still work toward market changes, Moffitt said, and they could even keep the exchanges created by the law although they would lose the federal money to help run them.
“Regulation for the health insurance market has been around forever, and that would just pick right back up,” he said.