Obamacare rollback could cost states billions, leave millions uninsured

 

President Donald Trump signs his first executive order as president, ordering federal agencies to ease the burden of President Barack Obama’s Affordable Care Act on Jan. 20 (Photo by Kevin Dietsch – Pool/Getty Images)

By Meg Wagner

Masses of Americans could be left uninsured

Republican lawmakers’ plans to repeal and replace the Affordable Care Act could leave millions of newly-insured Americans without healthcare coverage and stop billions of federal dollars from flowing into states, according to a new report.

The analysis, compiled by the apolitical consulting healthcare firm Avalere Health and the bipartisan business management firm McKinsey & Company, was presented to state governors who met in Washington D.C. on Saturday.

Former president Barack Obama’s 2010 Affordable Care Act (ACA), also referred to as Obamacare, led to 20 million Americans gaining insurance through two main channels: subsidizing private health insurance across the country with income-based tax credits; and an optional expansion of Medicaid to more low-income individuals, which 31 states accepted.

In a Feb. 16 policy brief, House Republicans suggested replacing the income-based tax credits with less generous age-based ones. If that switch happens, a state that expanded its Medicaid program under Obamacare would see a 30 percent decline in the number of people insured through individual marketplace plans, according to a copy of the report obtained by Vox.

The repercussions would be even more dramatic in a state that didn’t expand Medicaid — those 29 states would see a 50 percent drop in coverage among residents.

And the possible rollback could cost states billions, as they lose the federal dollars Obamacare funneled their way. A state with expanded Medicaid could lose 24 percent of federal funding, and would need to spend $6.2 billion of its own funds over five years to close the gap.

A drafted bill but no set plan

Republicans have vowed to repeal Obamacare since the moment it was signed into law. President Donald Trump, who campaigned on a promise to swiftly overhaul the system, issued an executive order scaling back parts of the ACA just hours after he was sworn in on Jan. 20.

That order directed federal agencies to change and waive parts of the ACA they deemed to be financially burdensome, but it provided no specifics on which provisions it was targeting and laid out no clear action plans.

Instead, the order was intended to implement a “prompt repeal” of Obamacare and “minimize the unwarranted economic and regulatory burdens of the act” in the meantime.

The Trump administration and Republican lawmakers have still not agreed upon and finalized a plan to kill Obamacare.

A draft of the House Republicans’ bill to repeal the act, which leaked on Friday, would indeed replace generous income-based subsidies with more conservative age-based tax credits, and roll back Medicaid spending, closely mirroring the suggestions they made in their earlier policy brief. However, the proposed law offers slightly larger tax credits than previous proposals.

Still, more moderate Republicans say both versions of the plan are too aggressive and believe the ACA should only be revised and not repealed.

Ohio Gov. John Kasich, who said he disagrees with the drafted bill, has especially cautioned his party about scaling down Medicaid.

“That is a very, very bad idea, because we cannot turn our back on the most vulnerable,” he said.

Obamacare increasingly popular

House Republican lawmakers said they plan to release the finalized version of their repeal and replace bill by early March.

Trump — who has not yet released any set plans about how he’d like to see the repeal implemented — is expected to shed light on his ideas on Tuesday, when he speaks to a joint session of Congress. He is also expected to discuss his plans for border security, job creation, and other campaign promises during the nationally televised address.

On Monday, Trump met with health insurance company executives in a bid to get them on board with Republican repeal plans.

“We have a plan that’s going to be fantastic,” Trump told the CEOs. “A very competitive plan, costs will come down, health care will go up very substantially. People will like it a lot.”

“It’s going to be special. I think you’re going to like what you hear,” Trump added.

Though Republicans control both the House and Senate, passage of any repeal and replace legislation isn’t guaranteed, especially with moderate Republicans voicing concern over Medicaid rollbacks.

Plus, there could be backlash from the public. Amid talk of slashing the program, the ACA has become increasing popular. A Feb. 22 poll showed public opinion split evenly: 45 percent of voters approved of the ACA and another 45 disapprove. A month earlier just 41 percent said they backed the law, while 52 were against it.