ACA Repeal and Replacement Update – March 16, 2017
Top healthcare takeaways from the week
1) CBO projects that 24 million would lose coverage by 2026 under the American Health Care Act; 2) Despite growing concern over the bill, today the House Budget Committee narrowly voted to advance it; 3) The Administration continues its push to gain support for AHCA; and 4) Secretary Price sent two letters to governors this week suggesting opportunities for state flexibility in the Marketplaces and Medicaid.
This week Congressional Budget Office (CBO) released its long-awaited report scoring the American Health Care Act (AHCA), setting the stage for further debate on, and division over, the bill as it continues to move through the reconciliation process.
CBO projects that AHCA would reduce the federal deficit by $337 billion by 2026, but would leave 24 million more uninsured in that same time period – totaling 52 million uninsured Americans by 2026. Coverage losses would be immediate, with 14 million more people uninsured by 2018. The report also projects that those who drop coverage between 2017 and 2019 would be disproportionately healthy, resulting in premium increases in the short run. Additionally, the bill’s repeal of enhanced funding for Medicaid expansion and per capita caps would reduce federal spending for Medicaid by $880 billion by 2026. Report: http://bit.ly/2n30V5S
HHS Secretary Price and Office of Management and Budget (OMB) Director Mulvaney both protested these findings, noting that CBO was not taking into account their full three-phase plan and that “we believe that our plan will cover more individuals at a lower cost and give them the choices that they want for the coverage that they want for themselves and for their families, not that the government forces them to buy.” The three-phase plan is for this bill to pass, for Secretary Price to implement administrative changes, and for the Republicans to work with Democrats to make additional legislation changes. Press release from HHS Secretary Price: http://bit.ly/2mXaLWX
In contrast, Speaker Ryan (R-WI) stated that he was encouraged by the report due to its projection of deficit savings and lower premiums over the long-term.
Other Congressional Republicans expressed unease – Sens. Collins (R-ME), Portman (R-OH), Gardner (R-CO), Daines (R-MT), Cassidy (R-LA), and Graham (R-SC) all noted concerns with the coverage losses projected. Senate Majority Whip Cornyn (R-TX) noted that the Senate expects to do better when they take up the legislation.
Notably, OMB’s markup of the bill reportedly projects the bill would result in even more uninsured, with 26 million new uninsured by 2018 and 54 million by 2026.
House Action
Meanwhile, AHCA continues to move through the steps of the reconciliation process. Today the House Budget Committee approved and advanced AHCA by a vote of 19-17; three members of the House Freedom Caucus, Reps. Sanford (R-SC), Brat (R-VA) and Palmer (R-AL), voted against the bill. The bill was previously passed by both the House Ways & Means and Energy & Commerce Committees last week, and now moves to the Rules Committee before advancing to the House floor for a vote.
The Trump Administration has continued to hold meetings with members of the House Freedom Caucus and the Republican Study Committee to discuss potential amendments to the legislation, including moving up the end date for Medicaid expansion and allowing states to impose work requirements on Medicaid beneficiaries.
In response to reports on Tuesday that the White House is working with House leadership on such changes in the form of a “Manager’s Amendment” – which could alter the bill before it hits the House floor – House Minority Leader Pelosi (D-CA) sent a letter to House Majority Leader Ryan (R-WI) arguing that Republicans should not hold a House vote without an updated CBO score on the final legislation. Press release: http://bit.ly/2mNYzpC Letter: http://bit.ly/2mOmbdG
Additionally, House Democratic Whip Hoyer (D-MD), Energy & Commerce Ranking Member Pallone (D-NJ), Ways & Means Ranking Member Neal (D-MA), and Education and the Workforce Ranking Member Scott (D-VA) also convened a Democratic hearing today on AHCA, during which they discussed the economic and coverage implications of the bill as well as listen to patient and provider perspectives. Press release: http://bit.ly/2mO42wl
Senate Action
The Trump Administration also continued its efforts to build support for AHCA among Republican Senators. Members of the conservative Senate Republican Steering Committee visited the White House on March 14 in an effort to suggest amendments that could alleviate conservative concerns. Attendees included some of the most outspoken critics of the bill, such as Sens. Paul (R-KY), Lankford (R-OK), Cruz (R-TX), and Lee (R-UT). Sen. Lankford noted that conservatives are concerned about the bill’s tax credits, how quickly the GOP is trying to move the bill through Congress, and whether all facets will be approved by the parliamentarian for the budget reconciliation process.
Additionally, Republican Senators discussed changes to AHCA with House Ways and Means Committee Chairman Brady (R-TX) and Energy and Commerce Chairman Walden (R-OR) as well as Secretary Price at a weekly Senate GOP Lunch. The group discussed a range of potential changes, like redesigning tax credits to be more generous to lower-income individuals and seniors and changing the Medicaid program to receive more support from states. Sen. Thune (R-SD) has indicated he is working on an amendment to increase the tax credits under the bill for low-income people and Sens. Alexander (R-TN) and Blunt (R-MO) have also noted support for the idea.
Meanwhile, on March 13 the full Senate confirmed CMS Administrator Seema Verma in a 55-43 vote. HHS Press release: http://bit.ly/2mXgjAZ
Administrative Action
On March 14, President Trump, Vice President Pence, and HHS Secretary Price held a listening session on healthcare at the White House with doctors, patients, and small business owners who discussed how the ACA is impacting them. HHS Secretary Price Press release: http://bit.ly/2mO5IWM
CMS also released its final report on Marketplace enrollment for the 2017 Open Enrollment period, finding that 12.2 million consumers selected or were automatically re-enrolled in Marketplace plans across the federally-facilitated and state-based marketplaces. HHS had previously projected enrollment of 13.8 million. Press release: http://go.cms.gov/2mO5TkZ
To highlight opportunities for state flexibility and innovation, HHS Secretary Price sent two letters to governors this week. The first letter encouraged states to apply for Section 1332 State Innovation Waivers. Beginning in 2017, under 1332 waivers states can apply to change some major elements of the ACA that apply to private health insurance coverage, including premium credits and cost-sharing reduction, marketplace operations, and the employer and individual mandate. Letter: http://go.cms.gov/2ngMPyN
The second letter, written in conjunction with newly confirmed CMS Administrator Verma invites states work with HHS on amending their programs through state plan amendments (SPAs) and the section 1115 waiver process. The letter highlights the Administration’s intention to improve the process for reviewing and approving SPAs and to provide “fast-track” approval of waiver and demonstration project extensions; premium contributions, and HSAs in 1115 waivers; additional time for states to comply with the 2014 Home and Community-Based Services Rule; and more tools for states to address the opioid epidemic. Notably, the letter also notes support for “innovative approaches to increase employment and community engagement.” In response, Senate Finance Committee Ranking Member Wyden (D-OR) and House Energy & Commerce Ranking Member Pallone (D-NJ) sent a letter to HHS Secretary Price arguing that HHS does not have the authority to approve Medicaid waivers that would condition eligibility on employment. HHS Letter: http://bit.ly/2m18ZVm Sen. Wyden and Rep. Pallone Letter: http://bit.ly/2n433dA
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