President Donald Trump’s surprise escalation of his legal attack on Obamacare dropped a political grenade in the laps of congressional Republicans, who are now stuck with devising a viable alternative if the courts invalidate the entire 2010 Affordable Care Act.
The problem for GOP lawmakers is the paucity of free-market policy ideas for health care that are politically popular. Obamacare’s expanded Medicaid and major medical insurance protections are now baked into voters’ expectations for insurance and patient care, and any Republican replacement would likely draw from the same proposals that ultimately led to a walloping in the 2018 midterm elections.
A definitive court ruling that throws out the Affordable Care Act — which includes many provisions not commonly thought of as being related to Obamacare — would cause a “thermonuclear meltdown on the health policy front” and “throw the political and policy world into chaos,” according to Doug Holtz-Eakin, president of the American Action Forum, a right-leaning think tank with close ties to House Republicans.
“I hope there is a beautiful, well-crafted plan and I just happen to be in the socially out-group,” Holtz-Eakin said. “But I don’t think so.”
On Thursday, Trump enlisted a trio of Republican senators — Wyoming’s John Barrasso, Louisiana’s Bill Cassidy and Florida’s Rick Scott — to come up with a “spectacular” health care solution if he wins in court. Policy staffers are reviving health care ideas the party considered previously, such as reducing federal regulations, empowering states and using high-risk pools to cover sick people.
The challenge for Republicans has been to fit these policies into a politically palatable law. Americans now expect people with pre-existing conditions to be protected from lifetime limits and higher insurance premiums. Even with the ACA in place, differences over Medicaid and waivers sought by Republican-led states have led to disparities in coverage across states.
The lawsuit, led by Texas and pending before the 5th U.S. Circuit Court of Appeals, could come before the Supreme Court next year in the heat of the 2020 election season. It argues that all of the Affordable Care Act, not just the Obamacare provisions, is unconstitutional and should be struck down. The Justice Department, after initially saying the law should be partially overturned, changed its position and said it should be fully invalidated.
“They will have to generate some sort of action” in Congress, Holtz-Eakin said. “I don’t think they’re ready. I don’t think there’s any evidence the White House has a plan.”
Underpinning the Texas-led challenger is a Republican attack on a key Obamacare provision — the fee for noncompliance with the individual insurance mandate. The lawsuit alleges that because the GOP’s 2017 tax law zeroed out that penalty, the provision is invalid, and due to its importance to the overall law, the entire ACA should be struck.
The ruling would affect a wide range of ACA provisions, including some related to matters such as influenza control, health care professional education, Medicaid long-term care benefits, and an effort to close the Medicare Part D prescription drug coverage “donut hole.”
Numerous legal experts say Texas’s legal challenge is far-fetched and unlikely to succeed. Five Supreme Court justices who upheld the law against challenges in 2012 and 2015 remain on the court.
“If we win on the termination of Obamacare, we will have a plan that’s far better than Obamacare, including, very importantly, pre-existing conditions, which I’ve always been in favor of,” Trump told reporters.
Driving Up Costs
That’s easier said than done. In 2017, the House-passed Republican health care bill rolled back some pre-existing condition regulations after conservatives complained that they were driving up costs for healthier people. It maintained the ACA’s ban on insurers denying coverage to a person over a prior illness, but included state waivers from the rule that they cannot charge sick people more money.
Democrats exploited that issue to great effect in the 2018 elections by arguing that the Republican plan would allow insurers to spike costs for sick people and potentially price them out of the market. They’re eager to exploit it again ahead of the 2020 election.
“The Trump administration radically expanded its war on America’s health care this week,” House Speaker Nancy Pelosi told reporters Thursday. “Striking down protections against pre-existing conditions. Striking down bans on lifetime limits and annual limits. Striking down the Medicaid expansion. Striking down tax subsidies that make health care affordable for more. And all would be ended if the president gets his way. We will fight back.”
Health care was the No. 1 concern for voters in the 2018 midterm, and those who cited it preferred Democratic candidates by a margin of 75 to 23 percent, according to exit polls published by CNN.