Sat | Aug 19, 2017

For Trump and GOP, 'Obamacare' repeal is complex and risky

Published:Wednesday | November 23, 2016 | 11:00 AM
United States President Barack Obama

WASHINGTON (AP):

Here's the idea: Swiftly pass a repeal of President Barack Obama's health-care law, perhaps soon enough for Donald Trump to sign it the day he takes the presidential oath. Then approve legislation restructuring the nation's huge and convoluted health-care system, despite Republican divisions, Democratic opposition, and millions of jittery constituents.

What could go wrong?

With Republicans controlling the White House and Congress in January, they're faced with delivering on their long-time promise to repeal and replace 'Obamacare'. Here are hurdles they will face:

SPEED VS DELIBERATION

Trump and congressional Republicans will be under intense pressure from their core conservative supporters to repeal Obama's 2010 health-care law - and fast. After all, Congress already sent Obama a repeal bill last January, which he vetoed, and many GOP voters will see no reason for delays this time.

But there probably won't be anything fast about Congress' effort to replace Obama's law, which is likely to take many months.

While the replacement effort is under way, Republicans will risk aggravating up to 30 million people who are covered by the law or buy policies with prices affected by its insurance marketplace. Democrats will be sure to accuse the GOP of threatening the health care of millions.

A SOLUTION

Nothing has been decided, but here is one likely scenario.

The new Congress, which convenes January 3, tries to quickly approve legislation repealing Obama's health-care law, maybe completing it by Trump's January 20 inauguration or soon after. But the repeal would not take effect until the future, perhaps a year later, to give lawmakers time to fashion a replacement. The version Obama vetoed had a two-year delay.

Seemingly acknowledging that two-step process, Vice-President-elect Mike Pence said Sunday on Fox News Sunday that Trump "wants to focus out of the gate on repealing Obamacare and beginning the process of replacing Obamacare".

Because Republicans will control the Senate by just 52-48, Congress will first have to approve special budget procedures to prevent Democrats from stopping repeal legislation by filibuster. Bill-killing filibusters require 60 votes to end.

But those special rules would apply only to items that affect the federal budget. Republicans, for example, would need a simple Senate majority to end IRS penalties against people who don't buy insurance but would still need 60 votes - requiring Democratic support - for other changes such as raising limits on older people's premiums.

House Budget Committee Chairman Tom Price (R - Ga) said that will restrain Republicans' ability to ram a "lock, stock and barrel" repeal through Congress.

GOP RISKS

One GOP danger: Congress and Trump might repeal Obama's law, but while they're labouring on a replacement, nervous insurance companies begin pulling out of markets and raising premiums. Insurers have been doing that under Obama, but now it would occur under a Republican government.

Another hazard: Congress' work could spill into the 2018 campaign season, when the entire House and a third of the Senate face re-election. Republicans will grow increasingly timid about anything that might anger voters.

"We want to be the rescue party instead of the party that pushes millions of Americans who are hanging by the edge of their fingernails over the cliff," says Senator Lamar Alexander (R-Tenn) who chairs the Senate Health Committee.

GOP PATHWAYS

Virtually all Republicans want to get rid of the health law's mandates that individuals buy coverage or risk IRS fines, and that large employers insure workers.

They also want to erase taxes on higher-earning people and the health-care sector. And they'd like to retain parts of the law guaranteeing coverage for people with pre-existing medical problems and keeping children under age 26 on family plans.

Unifying Republicans much beyond that is a work in progress.

Trump's health-care views have varied and lack detail. His campaign website touts tax deductions for health insurance premiums and permitting policies to be sold across state lines. He'd also revamp Medicaid, which subsidises health coverage for low-income people, directing fixed amounts of money to states and letting them structure benefits.

House Speaker Paul Ryan (R-Wis) last summer unveiled an outline of the House GOP's solution, though it lacked cost estimates and details. It would provide tax credits, impose taxes on the most generous employer-provided health-care plans, revamp Medicaid and let Medicare beneficiaries pick private plans instead of today's fee-for-service coverage.

Senate Finance Committee Chairman Orrin Hatch (R - Utah) has also advanced a framework relying heavily on tax credits.

REMAINING QUESTIONS

Thirty-one states - including Pence's Indiana, where he is governor - plus the District of Columbia have expanded Medicaid coverage to nine million additional people under Obama's law. Curtailing that programme will divide Republicans.

Taxing the value of some employer-provided health plans, aimed at curbing the growth of costs, is "a political landmine," said GOP economist Douglas Holtz-Eakin. Republicans have long resisted tax increases.

Obama's law mandates coverage for individuals because without that requirement, many healthy people would forgo policies, driving up costs for everyone else and destabilising insurance markets. Ryan has proposed shielding people from higher premiums if they've had "continuous coverage," allowing higher rates for people who have not had policies, but Republicans have yet to decide how to keep insurance markets viable.