A prominent and unlikely group of liberal and conservative health experts have authored an ambitious plan to fix the Affordable Care Act — and they plan to make a hard push for their ideas on Capitol Hill. The plan is notable because it has the support of especially well-connected health advisers on both sides of the aisle.
This new plan would aim to bring more stability to the Obamacare marketplaces by securing funding for key health law subsidies and ensuring strong incentives to enroll in coverage. In a nod to conservative priorities, it would also allow states more flexibility to pursue experimental waivers and higher contributions to tax-advantaged health savings accounts.
Those ideas aren’t new. Other plans to fix the health care law released in recent months have made similar arguments about continuing the CSR payments and incentivizing enrollment; there is a pretty clear consensus about how you stabilize the individual market, if that is Congress’s goal.
The big deal here is who now supports that plan. The group includes both Democrats who advocated vociferously for Obamacare’s passage and Republicans who have served in previous administrations or advised recent presidential candidates, and who have argued for scrapping much or all of the law. It’s not a bunch of centrist health policy experts. In fact, those who began the effort specifically wanted to avoid a centrist effort. They felt it was important to have experts who are generally divided on health care issues. If that group could come together, then Congress might have a shot too.
“Each of us has been around for a while,” says Gail Wilensky, who served as Medicare administrator under George W. Bush. “We don’t just have centrists but we reflect views across the spectrum.”
This is a group with a deep Rolodex on both sides of the aisle, one the members plan to put to use at a critical moment for health policy in Congress, in the wake of Republicans’ failure to pass a repeal-and-replace plan for the ACA. The Senate plans to hold bipartisan hearings on fixing the health law when it returns from recess in early September, and the group’s members hope to secure meetings with the senators at the heart of that effort.
“All of us have contacts, networks, and folks we have conversations with on these topics,” says Lanhee Chen, who advised Mitt Romney on health policy during the 2012 campaign. Chen has been supportive of Republican repeal efforts but now has turned his attention to this plan to fix the law. “The unique element of this group is the breadth and depth of contacts in policymaking circles.”
“This package is no one’s conception of what is perfect health reform,” says Ron Pollack, chair emeritus of the health advocacy group Families USA, an ardent defender of the ACA. “None of the signatories, if acting alone, would offer this precise package. But that is the whole process of bipartisanship. As a composite, we think this is constructive and has the best opportunity to move forward in Congress.”
The bipartisan plan to fix Obamacare, explained
The group released Wednesday a four-page outline of how it would approach a health care bill this fall, meant to stabilize individual market. Its proposals include:
Continued funding of the cost-sharing reduction subsidies. Trump has flirted with halting payments from this $8 billion fund, which covers copayments and deductibles for low-income Americans. The cost-sharing reduction (CSR) subsidies are also the subject of a pending lawsuit, which argues that Congress never appropriated this money, thus making the funding illegal. If Congress were to appropriate this funding, as this plan recommends, it would make that lawsuit moot — and bring a lot more certainty to the payments insurance plans on the individual market can expect to receive.
To stabilize the individual market, the report also recommends “reassessing” certain health law policies that are meant to stabilize the individual market, to see if they could be made to work more effectively. The group is frank in this recommendation that they don’t agree on how these policies should change, but do agree that Congress would be wise to figure out ways to give more help to the insurance plans that end up with a sicker-than-expected patient population, and have higher premiums as a result.
Continue to encourage all Americans to sign up for coverage. The mandate that nearly all Americans purchase coverage or pay a fine is one of Obamacare’s least popular provisions. But, as the authors of this plan note, any successful coverage expansion needs some type of policy to encourage healthy people to purchase a plan they may not use very much.
“A compromise should involve combining incentives to purchase health insurance with effective sanctions for not enrolling or not maintaining coverage, including financial penalties and waiting periods,” this report recommends.
In other words: If states don’t like the individual mandate, then Congress might be able to give them the option of creating a waiting period for those who opt out of the individual market. (Meaning that, when they did want to sign up, they might have to wait six months or so before they could get back into the individual market.)
At the same time, the report is pretty unequivocal that outreach and advertising for the marketplaces needs to continue in 2018. To hold premiums down, healthy people need to know about the opportunity to purchase coverage. “Health insurance can be confusing, and some Americans rely on enrollment assistance to make the smartest choices for themselves and their families,” the report notes.
Let states do more experimentation within the health care law. Conservatives have long argued that the health care law is too onerous for states, providing a one-size-fits-all approach to health coverage that doesn’t fit diverse populations well.
Liberals have typically prickled at this suggestion, worrying that flexibility could be another word for rolling back the health law’s benefits. This report attempts to find some common ground between those two positions, conceding that states could experiment more with allowing different state level approaches. In particular, they suggest allowing ways to “combine private and public coverage to provide greater freedom and work opportunities for disabled Americans.”
“Though we differ in our views regarding the scope of the guardrails that should be established, we encourage Congress to consult with states and others on how to refine the guardrails to provide enhanced flexibility,” they advise. “More financing flexibility could better enable states to achieve these types of innovations that promote continuity, health care efficiency, and coverage innovation.”
Allow a “judicious expansion” of health savings accounts. Employed Americans currently have the opportunity to set up health savings accounts (HSAs), where they can stash pre-tax dollars to pay for things like copayments and other out-of-pocket medical expenses.
Conservatives have long argued for an expansion of HSAs, particularly in combination with high-deductible plans. If individuals are drawing from an HSA each time they go to the doctor (as would be the case in a high deductible plan), advocates expect they might think twice about whether they really need that doctor appointment. This could help keep the country’s ever-growing health care costs in check.
The flip side of this, however, is that you could see some patients skipping out on needed doctor visits precisely because they’re worried about the price. And expanding the use of HSAs would likely be a regressive policy, advantaging wealthier Americans who have money to contribute to their HSAs in the first place.
This report endorses a significant expansion of HSAs that would allow, for example, individuals to pay their premiums from these tax-advantaged accounts.
The expansion of HSAs is not directly related to fixing the health care law. Instead, it’s a policy olive branch from the liberals in this group to the conservatives. The report is surprisingly clear on this point: “Though we disagree on the efficacy, we support judicious expansion of their use by consumers and employers as a trust-building step across the partisan divide.”
Ensure funding for the Children’s Health Insurance Program (CHIP). CHIP is a federally funded health program that covers about 8 million low-income children. Its funding is set to run out at the end of September, and this group recommends reauthorizing the funding for an additional year. Again, this is not directly related to the health care law, but would bring more stability to the health care system if providers knew this safety net program would continue to receive its funding.
The policy ideas here aren’t the big deal. The coalition is.
Wilensky began organizing the bipartisan group back in January in partnership with Pollack, chair emeritus of Families USA, a health advocacy group that has ardently advocated for the Affordable Care Act.
They are joined by Chen, who has defended the House’s Obamacare repeal bill; Stuart Butler, a former vice president at conservative Heritage Foundation, which supports Obamacare repeal; and Grace-Marie Turner, who was part of John McCain’s 2008 policy advisory team. This is a group of health experts who have been deeply critical of the Affordable Care Act.
They are working with some key supporters of the health law, including Pollack and John McDonough, a Harvard professor who advised Sen. Ted Kennedy during the health reform debate in 2009, and Vikki Wachino, who ran the Children’s Health Insurance Program under President Barack Obama.
When I read this list, I see a who’s who of health policy experts — a group that, because of its political differences, has not teamed up before. It includes the conservative advisers that I’d expect Sen. Lamar Alexander (R-TN), who chairs the HELP committee, to reach out to — and the liberal Obamacare advocate that Sen. Patty Murray (D-WA), the committee’s ranking member, would call for advice on fixing the health law.
The experts that both Murray and Alexander would call are now backing the same plan to fix Obamacare — a promising step toward possible success in the bipartisan effort to fix Obamacare.
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