Trump's Victory Imperils ACA
The stunning victory of Donald Trump on Tuesday and the GOP's continued hold on Congress likely puts the Affordable Care Act in its greatest peril since it was signed into law more than six years ago.
With the dust just settling on the election and more than two months to go before Trump's inauguration, it remains unclear as to what the ramifications will be to California's huge healthcare sector.
Trump, who campaigned against the double-digit premium increases the federal and state health insurance exchanges announced in the days before the election, repeated a long-heard refrain from Republican lawmakers and office candidates: Their intention to repeal the ACA and provide a replacement, but without providing specifics.
“There is no reason why we shouldn't take Trump at his word. He was vehement about dismantling Obamacare, and given the way the GOP has behaved on this issue, I think they are going to make a run at it,” said Jim Lott, who teaches healthcare policy at USC and Cal State Long Beach and was the longtime executive vice president of the Hospital Association of Southern California.
Anthony Wright, executive director for the consumer group Health Access California, was also alarmed.
“The current Congress voted 60 times to repeal the ACA. The block was the President. At risk now is coverage for literally millions of Americans,” he said. Wright added that lawmakers in Congress need to be clearly informed of the consequences of a repeal vote.
The news was mostly greeted with what could be described early Wednesday as stunned silence. The California Hospital Association, Kaiser Permanente, and other leading healthcare entities in the state did not issue statements or immediately respond to requests seeking comment. Many national healthcare associations offered mostly anodyne statements congratulating Trump and saying they looked forward to working with his administration.
Trump's replacement plans, which had been posted on his campaign website during the summer, included a wholesale repeal of the ACA, allowing insurers to sell policies over state lines, a greater push for the use of health savings accounts, block grants to states for Medicaid coverage, and a commitment to healthcare price transparency.
Lott suggested that Trump may wish to keep the ACA's underwriting exclusions in place. But he was less sure about the individual and employer mandates. “If you don't have mandates, the market would self-destruct,” he said.
An analysis undertaken by the Commonwealth Fund on Trump's plans concluded that more than 19 million Americans will lose their insurance coverage if all of his proposals are put into effect.
Another study by the Urban Institute suggests that 24 million could lose coverage, including as many as 7.5 million Californians – nearly a quarter of the state's population.
Lott also believes that disenrolling tens of millions of Medicaid enrollees at once who gained coverage as part of the ACA's expansion of eligibility would likely be politically difficult, particularly in more liberal states such as California. But that means states may still be left on the hook to cover the costs of those relatively new enrollees.
Of Trump's proposals, Gerald Kominski, director of the UCLA Center for Health Policy Research, said at a recent gathering to discuss the election that price transparency “was the one aspect of healthcare reform from the Trump campaign that makes a lot of sense.”
And despite the U.S. stock markets engaging in a seemingly improbable rally in Wednesday's session, the stocks of both hospital systems and insurers with heavy concentrations of Medicaid enrollees were trounced. Tenet Healthcare Corp., which operates six hospitals throughout the state, saw its stock price plummet 25%. HCA, Inc., which operates five hospitals in California, saw its stock drop nearly 11%. Community Health Systems, which was in the midst of shedding properties in order to pay down debt, saw its stock price drop more than 21%. It does not operate any hospitals in California.
Long Beach-based Molina Healthcare, which is one of the biggest Medicaid managed care insurers in the country and offers commercial coverage on several insurance exchanges, saw its stock price drop nearly 16%.
Peter V. Lee, Executive Director of Covered California, initially announced a press conference for Wednesday afternoon, then postponed it in lieu of speaking with journalists one-on-one later this week. California's exchange, long-touted as one of the ACA's success stories, provides coverage for about 1.4 million Californians, about 90% of whom receive some form of tax subsidy under the ACA to reduce their premiums.
However hidden they currently appear, there may be some silver linings in California to Trump's election and the dismantling of the ACA. Lott believes that a wholesale repeal of the law could stir enough of a backlash that state officials would make a run themselves: At creating a single-payer healthcare system. The Democratic-controlled Legislature makes that possible, he noted.
But single-payer has had a rough time elsewhere in the U.S. Vermont backed away from a single-payer experiment in 2014 after Gov. Peter Shumlin admitted that the taxes required to pay for it would hurt the state's economy. And a referendum on creating a single-payer system was soundly defeated yesterday in Colorado. It lost by a 60-point margin.
