Overpromising and Underdelivering: Health Care Reform During Trump’s First 100 Days

An analysis of the new administration's signature legislative priority, "repealing and replacing" Obamacare.

 

Fervor both for and against the Affordable Care Act has been a fixture of American politics for the last decade, often being a key determinant of support for political candidates, including President Donald Trump. This piece examines why health care reform efforts during the Trump administration’s first 100 days have been stymied despite having a Republican-controlled Congress, paying particular attention to the dynamics of public sentiment toward ACA repeal. These dynamics, in addition to shifting political coalitions and the specter of the 2018 midterm elections, make the outlook for health care reform as Republicans have envisioned and promised appear precarious.

 

In early March, after much urging from President Trump, Republican legislators crafted the American Health Care Act (AHCA), a bill to repeal parts of the Affordable Care Act (ACA) and replace others. A few weeks later, the AHCA was abruptly pulled from a scheduled vote due to lack of support from both sides of the aisle. Now, a major amendment has been added to the AHCA, and the revised bill may be scheduled for a vote in the House as early as this week. But is this latest incarnation of the AHCA any more likely than its predecessor to be passed in the House, let alone become law?  Key to answering this question is knowing the main hindrances to reform thus far under the Trump administration.  

 

What Would the Original AHCA Change?

The three paramount critiques of the ACA outlined below provide an apt summary of the fundamental changes the AHCA would make to America’s current health care system.

Health insurance in the United States is best run as a private market, with minimal federal government regulation and with policies that encourage competition. The AHCA would cut all taxes imposed by the ACA, including those on medical devices and the affluent. It also would allow health insurers to charge higher rates based on age, and permit them to charge higher penalties for lapses in coverage.The ACA allows states to expand their Medicaid coverage, and if they do, individuals earning less than 138% of the poverty level are eligible for Medicaid coverage (and therefore federal funding). Subsidies are provided to low- and middle-income individuals to make purchasing health insurance more affordable. Both of these features substantially increase federal budget deficits. The AHCA would create a delayed repeal of the Medicaid expansion essentially phasing it out by 2020. Furthermore, federal Medicaid spending would be capped per person, versus the current pay-for-all-services program. Subsidies would be terminated and replaced with tax credits for low- and middle-income individuals.The ACA creates a mandate that every person who can afford it have insurance, and that all employers provide affordable insurance coverage; these mandates are unconstitutional. The AHCA effectively eliminates these mandates.  

The AHCA would leave in place several popular ACA provisions, most notably that individuals with pre-existing conditions could not be denied insurance coverage, and children under the age of 26 may remain on their parents’ insurance.

 

Why Did the Original AHCA Fail?

 

1)    Universally Panned By Outside Groups 

Virtually every analysis of the bill and its effects was negative across the political spectrum. Conspicuously, numerous conservative think tanks expressed discontent that legislators did not include measures for increasing competition in the insurance market as a means of reducing premiums. Many insurers, as well as the vast majority of physician associations, patient advocacy groups, and hospital groups opposed the AHCA as well. Furthermore, numerous Republicans at the state level, especially governors of states who had expanded Medicaid under the ACA, were concerned about the negative impact the proposed law would have on citizens.

 

2)    Overestimating Citizen Support for Repeal, Underestimating Discontent With the Replacement Plan

For years support for the ACA had leaned negative, however, polls conducted in early 2017 showed this sentiment changing.  As of February, polls found approval for the ACA to be at its highest level since the law’s implementation, with the majority of respondents in favor of the status quo, and of those who wanted reforms, the vast majority wanted only modifications, not a repeal. Although approval is still deeply divided along partisan lines, the polls found an almost equal desire for repeal vs. replace among Republicans dissatisfied with the ACA. This split suggests that regardless of the reform bill the Republicans craft, a large portion of their base would not be happy with the end result, complicating revision efforts.

In addition to higher overall levels of support for the current health care system, citizens began voicing their dislike of the AHCA  immediately after its release. Initial polling suggested respondents cautiously supported it, with lingering uncertainty about how changes may impact them personally. That tepid support shifted quickly to disapproval: town halls across America were packed, members of Congress bombarded with questions and demands. Letters, tweets, and calls predominantly in opposition to the bill poured into Congressional offices. With such constituent animosity toward the proposed reform, many representatives expressed incredulity that a vote would even be held on the bill.

 

3)    A Split Within the Republican Conference

The AHCA was not designed to get bipartisan support in the House, which meant that Republicans could not afford any defection from party-line voting. However, the legislation was unpalatable to both ends of the conservative spectrum. Roughly two-dozen moderate GOP members, many of whose districts voted for Hillary Clinton in the general election, were faced with an impossible task of trying to sell their constituencies on a repeal/replace bill. Secondly, the non-partisan Congressional Budget Office’s analysis of the AHCA’s likely impact estimated an additional 24 million Americans would not have health insurance in 2026 compared to the current system. This decrease in coverage would largely be due to the rollback of Medicaid expansion and the elimination of the individual mandate. Although the CBO also projected a $337 billion budget deficit reduction over a 10-year period, moderates deemed the loss in coverage not worth the savings.  Lastly, the hardline Freedom Caucus was discontented that the AHCA did not approximate a full repeal, and refused to support the law, terming it “Obamacare Lite.” With roughly three-dozen members, their lack of support ensured the bill would never pass a vote in the House.

 

4)    Administration’s Missteps

From start to finish, major political errors were made by the Trump administration in tackling health care reform in general, and the AHCA effort specifically. To begin, the president pushed for a bill to be written as soon as possible, putting pressure on a party that for years had struggled to create an ACA reform package that would appease both sides of the aisle. Once the bill was released, the president expressed tepid support for it, which did not sit well with Congress and sent mixed signals to his base. He then shifted to total support of the bill, as well as to delivering threats and ultimatums to members of Congress who refused to support it. Most notably, he stated that if this particular bill failed to pass the House, his administration would give up on health care reform entirely. He demanded a vote on the bill be held, despite Speaker Paul Ryan and others warning him that the votes were not there for its passage. Finally, a series of 11th hour tweaks were made to the bill as overtures to members of the Freedom Caucus. However, the approach Trump used – telling them to not fret over the details of the bill, refusing to negotiate those details, and then asking them to see the bigger picture of party unity – runs counter to basic knowledge of the American political scene. Members of Congress know full well that details make or break the success of a policy, and in turn, determine constituents’ satisfaction with that policy. Moreover, the Freedom Caucus is known for having no qualms about breaking with the party line in the interest of their constituents. In the end, Trump’s attempts to both cajole and strong-arm members of Congress came to naught, and the vote was pulled from the floor to spare the party a humiliating defeat.

 

The MacArthur Amendment 

The MacArthur Amendment, added to the AHCA the last week of April, is an attempt to modify the bill to gain the support necessary for a win in the House before Trump’s first 100 days came to an end. It retains the foundational reforms proposed by the AHCA, but gives additional leeway to states regarding requirements for insurance coverage. Of major significance is the provision that allows states to opt out of requiring essential health benefits coverage, meaning that insurers would be allowed to offer bare-bones plans. Although this may lure insurers back to the exchanges, and thereby increase competition in the market, it almost assuredly would result in poorer coverage for those insured. The amendment’s other noteworthy provision is that states can waive some of the requirements of “community ratings.” This means that although insurers would still be required to cover the elderly and those with pre-existing health conditions, it does not protect these groups from being charged extremely high premiums. When combined with the elimination of the subsidies already outlined by the AHCA, this could leave a segment of the population most in need unable to afford health insurance.

 

What Lies Ahead?

Reviewing the resurrected AHCA and the four aforementioned reasons the initial bill failed, this particular effort to reform the ACA is unlikely to move forward. Several influential outside organizations including the American Medical Association and the American Association of Retired Persons have already openly opposed the amendment. Given that this new version would result in the same loss of coverage and could increase premiums drastically for the elderly, it is unlikely to garner the widespread support from outside groups necessary for its passage. Furthermore, early polling of public support for key parts of the amended AHCA is negative: in particular, variation across states on requirements for the provision of essential health benefits and protections for individuals with preexisting conditions. The amendment does not address the concerns voiced by constituents in March, and, instead, is likely to exacerbate them.

This reform effort does have the benefit of being currently supported by the Freedom Caucus, but again, with their support comes the likely loss of moderate Republican votes as well as any chance of bipartisan approval. Additionally, moderates may try to avoid a vote on the bill completely, given that a vote in either direction would anger a substantial number of their constituents. Moreover, if this version were to pass the House, it would not pass the Senate without significant revisions. Although the revised bill could come to a vote this week, now that the 100-day goal line has passed, there is much less momentum to push this reform effort forward.

Looking past the immediate future, health care reform in the Trump era is certainly possible, but will prove substantially more difficult to achieve than the president imagined. There is certainly a will for reform, as Republican legislators are anxious to make headway on this issue in advance of the 2018 midterm elections. Given conservatives’ emphasis on the necessity of reforming the ACA for the last seven years, and the fact that they are in control of both the legislative and executive branches, failure to show forward movement in this arena would prove costly at the ballot box. Abnormally competitive special elections held in April in deep-red districts in Georgia and Kansas have only heightened awareness amongst Republicans of the need to demonstrate to their constituencies that they are fulfilling their campaign promises. So how could measurable progress come about? Bipartisan effort is really the only way forward with health care reform, but before such efforts can be attempted, the Republican conference needs to be more cohesive. Getting to that point will take a significant amount of time, an entirely different set of strategies, and the road forward has been made all the more difficult by Trump’s rocky first 100 days.

 

Amy L. Ruddle is a freelance writer and graduate student at American University's School of Public Affairs. Amy's primary areas of expertise are social movements and comparative public policy. Her prior research includes studies of political behavior in Latin America and China, and American education and health policies. 

The views expressed in this publication are not necessarily those of the Friedrich-Ebert-Stiftung or of the organization for which the author works.

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