ACA Repeal Watch: Senate Bill Crumbling as Leadership Clinging for Hope; ACG’s Analysis and Outlook

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    Whitfield L. Knapple, MD, FACG
    Chair, ACG National Affairs

    This week, Senate Republicans gave up their bid to repeal and replace the Patient Protection and Affordable Care Act (ACA).  Majority Leader Mitch McConnell (R-KY) again canceled a previously planned vote to proceed with the latest iteration of the “Better Care Reconciliation Act of 2017.”  This decision to cancel the repeal and replace bill came about after both moderate and conservative Republican Senators could not agree on a final package that could garner the 50 votes needed to proceed.  Senate Republicans and the Trump Administration continue to seek compromise among Republican Senators as a whole.  

    Sen. McConnell then shifted gears and announced that the Senate plans to take up the same legislation that Congress passed in 2015, which would completely repeal the ACA.  The implementation of this legislation would begin after a two-year delay in order to give Congress the time to develop a replacement plan.  At the time, 48 current Republican Senators supported the ACA repeal bill, including Sen. Lisa Murkowski (R-AK) and Sen. Shelley Moore Capito (R-WV).  The vote was political, as the Senate expected that President Obama would veto the legislation.  Sens. Murkowski and Moore Capito have already announced that they will oppose the measure next week.  Sen. Susan Collins (R-ME) voted “NO” to ACA repeal in 2015, and stated that she would vote “NO” again this year.  Among the Republicans who voted in favor for the measure in 2015, but may not vote the same way this time around, include: Bill Cassidy, MD, FACG (R-LA), Jeff Flake (R-AZ), Cory Gardner (R-CO), Dean Heller (R-NV), Jerry Moran (R-KS), Rob Portman (R-OH), and Dan Sullivan (R-AK).  Another Republican to watch?  Sen. Todd Young (R-IN).  Sen. Young was not in the Senate in 2015, but hails from a state that reformed and expanded coverage requirements for Medicaid – under then Governor and now Vice President Mike Pence – in part due to the ACA’s expansion of certain federal waivers (footnote: some of the Medicaid reforms passed in Indiana were included in the House and Senate ACA repeal bills).  

    Sen. McConnell may ultimately scrap this vote as well as we head into next week, in order to protect vulnerable Senators, if more Republicans come out against ACA repeal without any replacement plan.

    On Wednesday, news broke that longtime fixture in the U.S. Senate, John McCain (R-AZ) has sadly been diagnosed with brain cancer.  Brain cancer was a major factor in 2009 and 2010 when Senate Democrats were struggling to pass the ACA, after longtime fixture in the U.S. Senate, Ted Kennedy (D-MA) was diagnosed with brain cancer.  

    What did the CBO say?  What happened to the Senate bill?   What is ACG’s analysis and outlook?

    On Wednesday, the Congressional Budget Office (CBO) and Joint Tax Committee (JTC) released an update estimate of the plan to just repeal the ACA.  The CBO and JTC that the legislation would decrease deficits by $473 billion over the 2017-2026 period, but:

    “The number of people who are uninsured would increase by 17 million in 2018, compared with the number under current law. That number would increase to 27 million in 2020, after the elimination of the ACA’s expansion of eligibility for Medicaid and the elimination of subsidies for insurance purchased through the marketplaces established by the ACA, and then to 32 million in 2026.”

    “Average premiums in the nongroup market (for individual policies purchased through the marketplaces or directly from insurers) would increase by roughly 25 percent—relative to projections under current law—in 2018. The increase would reach about 50 percent in 2020, and premiums would about double by 2026.”

    “In CBO and JCT’s estimation, under this legislation, about half of the nation’s population would live in areas having no insurer participating in the nongroup market in 2020 because of downward pressure on enrollment and upward pressure on premiums. That share would continue to increase, extending to about three-quarters of the population by 2026.”

    Also on Thursday, the CBO and JCT completed an updated estimate of the Senate Republican’s plan to repeal and replace the ACA (Better Care Reconciliation Act of 2017).  The repeal bill would now reduce the deficit by $420 billion over 10 years, but:

    “CBO and JCT estimate that enacting this legislation would reduce federal deficits by $420 billion over the coming decade and increase the number of people who are uninsured by 22 million in 2026 relative to the number under current law.”

    “The largest savings would come from a reduction in total federal spending for Medicaid resulting both from provisions affecting health insurance coverage and from other provisions. By 2026, spending for that program would be reduced by 26 percent. About three-quarters of that reduction would result from scaling back the expansion of eligibility enacted in the Affordable Care Act (ACA). In 2026, for people who are made newly eligible under the ACA (certain adults under the age of 65 whose income is less than or equal to 138 percent of the federal poverty level [FPL]), Medicaid spending would be reduced by 87 percent, from $134 billion to $17 billion—mainly because the penalty associated with the individual mandate would be repealed and the enhanced federal matching rate for spending on that group would be phased out. As a result of the reduced matching rate, some states would roll back their expansion of eligibility and others that would have expanded eligibility under current law would choose not to do so. All other federal spending on Medicaid in that year would be reduced by 9 percent, from $490 billion to $447 billion.”

    Individual Markets: Low percentage of U.S. population, but major issue.  The changes to essential health benefits and pre-existing conditions would impact a low percentage of Americans overall, but remain a significant factor in the health reform debate.  These patients are the ones who greatly need access to health insurance and specialty care, and may represent a good percentage of patient volume in GI practices compared to other specialties.  That is why ACG remained opposed to any changes to important patient protections.  Individuals who are not insured as a part of a group only represent roughly 7% of the U.S. population, according to the Kaiser Foundation (2015 latest data available).  These numbers generally reflect the “Health Insurance Coverage in the United States: 2015” report by the United State Census Bureau in September 2016, except for the non-group “direct purchase” market, reported at  16%.  The Census Bureau report does note that individuals in “direct purchase” private plans may include others (such as dependents under age 26 remaining under a caregiver’s plan).   

    Medicaid: Perhaps more popular than estimated. As ACG alerted membership in June, whenever legislators are forced to vote on “taking away” a benefit, it is always an uphill battle politically, regardless of political party or ideology.  As Senate Republican Leaders struggled for more Republican support, changes to Medicaid and Medicaid expansion has become increasingly too much for many Republican Senators (including those who did not voice their objections publicly).  Objections to the proposed changes to the Medicaid program may have caught Republican leadership by surprise, as Medicaid may be increasingly more popular among both Democrats and Republican constituents.  What’s more, Republican Governors also expressed objections to the House and Senate health reform bills, largely due to the proposed changes in Medicaid.    

    Medicaid represents an estimated 20% of the U.S. population, according to both the Census Bureau and the Kaiser Foundation.  These figures are based on 2015 data (latest available), so the numbers could be larger, as states continued to expand and/or promote their expansion of Medicaid eligibility requirements after 2015.  For example, while the Census Bureau and Kaiser’s data from 2015 include over 62 million Americans enrolled in Medicaid, recent data from April 2017 shows that Medicaid covers more than 70 million people.  

    ACG remains mindful that proposed cuts to Medicaid programs ultimately may lead to cuts to providers and practicing GI clinicians.  It is simply a politically safe option for state governments when compared to raising taxes or limiting coverage.  Thus, ACG and ACG Governors continue to remain vigilant at the state and local level.  Medicaid cuts also impact ACG members in large academic institutions. According to Politico, teaching hospitals experienced the highest percentage of Medicaid enrollment between 2012 and 2015.  Medicaid funding contributes a greater percentage to teaching hospitals’ revenues, thus affecting research funding, grants, and matching funds to receive research funding.  

    ACG‘s radar screen: Will Sen. McConnell and Republican Leadership have a better opportunity in the fall?

    Looking on the horizon of the 2017 legislative calendar, Majority Leader McConnell may have more leverage to incorporate some of these proposed policy changes in Medicaid.  ACG is marking September 30th as an important date.  Why?  Congress must pass a budget or continuing resolution of funding by September 30th.  Congress must also reauthorize the Children’s Health Insurance Program (CHIP) that is part of Medicaid by September 30th.  Nearly 36 million individuals are enrolled in CHIP or are children enrolled in the Medicaid program in the 48 states that reported child enrollment data for April 2017.  A must-pass reauthorization could provide leverage to include Medicaid policy changes. Conversely, it could continue to fracture the Republican Party and cause more headaches for Republican leadership. This is especially important, because Congress must also vote to increase the federal debt limit in late September or early October.   

    ACG remains focused on important issues impacting clinical GI and patients, and will continue to use this opportunity to advocate on your behalf.        

    Whitfield L. Knapple, MD, FACG

    ACG National Affairs Committee

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