How should your healthcare organization prepare for the new presidential administration? Our Washington, D.C. healthcare analyst Andy Bressler identified key legislative and policy areas during a webinar with industry leaders. Below are highlights.
WHAT’S AHEAD FOR CONGRESS?
While repealing the Affordable Care Act will be a focus for Republicans, House and Senate leaders are also on target to complete the 21st Century Cures Act by December 2017, which aims to speed clinical trials, medical research and approvals. Senate efforts are stalled due to debates over gun provisions included in the bill. Other 2017 legislation includes user-fee legislation and extending Medicare and Medicaid CHIP program provisions.
WHERE IS HEALTHCARE REFORM TODAY?
The U.S. uninsured rate is down to 11%, from a peak of 18%. Medicaid enrollment is strong at 15.7 million, with expansion in 31 states and more to come. However, officials expect exchange enrollment to decline from 12.7 million to 10 million by the end of 2016.
WHY ARE POLICYMAKERS CONCERNED?
They attribute declining enrollment to increased exchange risk-pool costs, fewer employers dropping coverage (which yields fewer individuals covered in exchanges) and 2017 premium increases, some as high as 100%.
CAN LAWMAKERS REPEAL AND REPLACE OBAMACARE?
Congress can’t repeal the ACA without a 60-vote Senate supermajority, but can eliminate key provisions through budgetary reconciliation. The Trump administration will likely pursue a Republican reform framework that includes expanding HSAs, allowing patients to purchase health plans across state lines and moving Medicaid to a block grant program.
WHICH PROVISIONS ARE SUBJECT TO CHANGE?
Coverage provisions at risk include exchange subsidies and Medicaid expansion, individual and employer mandates as well as related tax increases.
WHICH PROVISIONS ARE LIKELY TO REMAIN?
Coverage for patients with pre-existing conditions and adult children up to age 26 on their parents’ plans can’t be repealed through reconciliation, as well as certain Medicare program reforms. Value-based care, ACOs, bundled payments and other payment reforms are likely to remain law. President-elect Trump has also stated that he would not support Medicare or Medicaid cuts.
ACA REPEAL AND REPLACE TIMELINE
- President- elect Trump and congressional leaders are pursuing reconciliation within first 100 days.
- Budget resolution process avoids 60-vote threshold for Senate filibuster.
- Prior reconciliation bill proposed repealing exchange subsidies, Medicaid expansion, individual and employer mandate, tax increases and more.
- A Republican alternative would require 2 to 3 years of implementation.
- Alternative plan promotes HSAs, provides tax credits to support individual coverage, establishes high-risk pools, restructures Medicare/Medicaid and provides plan access across state lines.
- Legislation would need Democratic support and risks alienating Medicaid expansion states and some Republican governors.
- Mid-term elections could influence legislation.
- If enacted, at least 18-36 months would be necessary to limit coverage disruption
WHAT’S AHEAD FOR MEDICARE PART B?
Phase I of Medicare Part B reform is structured to be budget neutral, but officials hope to achieve savings from behavioral changes. Phase II incorporates value-based pricing tools to reduce drug payments, but is not likely to move forward under a Trump administration, due to strong opposition by congressional Republicans, as well as physicians, hospitals, patient groups and some Democrats.
ARE HEALTHCARE PAYMENTS SUBJECT TO CHANGE?
Inpatient hospital Medicare payment increases are in line with expectations, as are physician MACRA and post-acute payments. Value-based purchasing and alternative payment models continue to expand in Medicare. Physician payments will shift to value-based and other alternative payment models by 2019.
- Congress will address ongoing healthcare legislation, but repealing the ACA will take center stage
- Speaker Ryan, Majority Leader McConnell and other congressional leaders can drive key changes through budget reconciliation
- Payment reform models, such as value-based purchasing, ACOs, bundled payments and drug pricing, are likely to stay in place