What is next for the Affordable Care Act?

Last month, Congress took the first step toward repeal of the health insurance law, the Affordable Care Act, and now lawmakers are crafting alternatives to replace the ACA. USC experts, from medicine to health care policy, weigh in.

Repealing ACA tax increases would drive deficits

“The effect on the individual marketplace isn’t the only consequence of a repeal before replacing. Less discussed are the additional challenges created by the tax cuts that would be enacted if Congress models its ACA repeal on the legislation considered last year through the budget reconciliation process — a process that seems increasingly likely. These tax cuts would make it much more difficult to achieve a sustainable replacement plan that provides meaningful coverage without increasing deficits.

“If the goal is truly to replace the Affordable Care Act and still cover a similar number of people, as President Donald Trump and some Republican Congressional leaders have indicated, lawmakers should not repeal the ACA tax increases until a replacement plan is enacted.”

PAUL GINSBURG
Director of public policy for the USC Schaeffer Center for Health Policy and Economics and professor at the USC Price School of Public Policy

California system is a model for expanded coverage

“The ACA tried to do too much while still leaving 15 million Americans uninsured. Further, the Congressional Budget Office recently projected a 10-year taxpayer bill for the subsidies alone at $866 billion. This is clearly unsustainable and requires a new approach that makes sure all Americans get critical health care when they need it without bankrupting themselves or the government.

“For a model, Congress should examine what happened in California. Here is real success: Medicaid expansion, a state-run exchange, and a group of health insurers committed to expanding coverage.”

DANA GOLDMAN
Director of the USC Schaeffer Center and distinguished professor at the USC School of Pharmacy and the USC Price School

Hospitals would brace for impact

“While no one knows the consequences of ACA replacement with certainty, we understand from the draft House reconciliation bill that the funding mechanisms – notably taxes, mandates, Medicaid expansion and subsidies – are likely to change by 2019, and that many insurance reforms may remain in place. We anticipate that once the changes are implemented, there will be an impact on patients and hospitals. Patient access and delivery of care are areas we’re examining closely for potential impacts in a protracted replacement scenario.”

TOM JACKIEWICZ
Senior vice president and CEO of Keck Medicine of USC

Repeal would lead to further privatization

“If repealed, the ACA is very likely to be replaced with a more privatized system. However, the private market has underlying problems. Few policymakers are considering how to protect the poor and vulnerable in a market-driven system.

“It is possible to achieve fairness and efficiency. A strong, vibrant marketplace with prudent government can provide us with both.”

DARIUS LAKDAWALLA
Quintiles Chair in Pharmaceutical Development and Regulatory Innovation and professor at the USC Price School 

Current proposals may fail sicker patients

“Many of the current proposals include, at a minimum, some type of continuous coverage provision that allows people with chronic health conditions who have continuously maintained coverage to buy health insurance at standard rates. For example, Paul Ryan’s ‘A Better Way’ proposal and Secretary Tom Price’s ‘Empowering Patients First Act’ would each prohibit insurers from charging sicker patients more than standard premiums in the individual market as long as they have maintained continuous coverage since before becoming sick.

“Such provisions are important to keep patients from seeing their health insurance premiums sky-rocket after becoming sick, which would defeat the purpose of insurance in the first place. However, these provisions also require that insurers sell policies to these patients at premiums that they know will not cover their expected health care spending, generating losses for the insurance company. On its own, this would create a situation where insurers have a strong financial incentive to avoid enrolling these sicker patients.”

ERIN TRISH
Assistant research professor at the USC Schaeffer Center and the USC Price School