ACA’s future hangs in the balance
President-elect Donald Trump has not made a secret of the fact that he is not a fan of the Affordable Care Act (ACA), indicating he will repeal and replace it, although details have been scant. It is unlikely that Trump will have the Congressional support to achieve a complete repeal, and this week, after meeting with President Obama, he states that he may leave portions of it intact.
Trump’s changes have the potential to wreak havoc on patients, providers, payers and employer health plans as well as all of their business partners because many aspects of the ACA have been assimilated into the healthcare system.
Here are some possibilities changes to healthcare under Trump:
Elimination of the insurance mandate/ exchanges/ subsidies. Approximately 20 million people are now insured as a result of the ACA. Many are predicting that Trump’s presidency will eliminate the insurance mandate, and potentially also the healthcare exchanges and tax subsidies. Providers and health plans have been adjusting to the “new normal” and wrestling with issues such as supplemented premiums and network adequacy—efforts that could prove to be moot.
Changes to Medicaid expansion. The ACA provides federal funding to states to expand their Medicaid programs. Medicaid expansion is already optional for states, and speculation runs high that a Trump administration will mean more power for individual states to control Medicaid coverage, possibly through block grant funding. It is likely that the “red” states will use this flexibility to implement more conservative measures into their Medicaid programs, such as a work requirement or the ability to exclude individuals who do not pay their premiums timely or who do not pay into a health savings account.
Quality incentives.The significant movement that has been made toward accountable care and patient-centered medical homes is based in large part on a high percentage of the patient population being insured. Providers investing in the infrastructure necessary to achieve the ACA’s quality and efficiency requirements have been counting on reduced uninsured and under-insured as well as the Medicare Shared Savings Program and related concepts. The six years since the ACA’s passage have been years of investing in the long-term future. While quality and efficiency are always priorities worth having, providers could find themselves over-extended with reduced return on investment.
Eliminated incentives for collaborative efforts. The changes in reimbursement and incentives to collaborate have resulted in a wave of consolidation in the healthcare industry through affiliations, mergers and acquisitions, affecting both providers and payers. The wave seems to have peaked, but it is likely that affiliations in the works will slow down until there is at least a glimpse of the future of healthcare in the Trump era.
We have no crystal ball—just a lot of guesses. Rather than crystal clear, the future of the ACA is clear as mud.
Sarah E. Coyne is a partner in the Health Law Practice Group at Quarles & Brady LLP. She has been the group's national chair since 2011, and has an active practice advising hospitals and other providers on the full gamut of health law issues, with emphasis on health information, Medicare billing compliance, and medical staff issues.