GOP's Obamacare repeal bills threaten huge disruptions across the health care system

Congressional Republicans, who for years blasted the Affordable Care Act for disrupting Americans’ health care, are now pushing changes that threaten to not only strip health coverage from millions, but also upend insurance markets, cripple state budgets and drive medical clinics and hospitals to the breaking point.

President Trump and GOP leaders have touted their Obamacare repeal bills — one passed by the House last month and a Senate version unveiled last week — as a necessary fix to problems created by the Affordable Care Act, known as Obamacare

But in physicians’ offices and medical centers, in state capitols and corporate offices, there are growing fears that the unprecedented cuts proposed in the GOP legislation would create even larger problems in the U.S. health care system.

“These reductions are going to wreak havoc,” warned Tom Priselac, chief executive of Cedars Sinai Health System in Los Angeles, one of the country’s leading medical centers. “It will be a tragic step backward not just for the people most affected, but for the country as a whole.”

Trump sounded a very different note in his weekly radio address Saturday, pledging anew to save Americans from rising health care costs he blames on Obamacare.

“The American people are calling out for relief, and my administration is determined to provide it,” he said.

Even supporters of the ACA acknowledge the current law needs adjustments, especially to insurance markets, where premiums have risen sharply in recent years and many insurers have pulled out.

But there are few indications the GOP repeal bills will bring much stability.

The nonpartisan Congressional Budget Office estimated the House repeal bill, which Trump celebrated in a Rose Garden ceremony last month, would nearly double the number of Americans without health coverage over the next decade, pushing the ranks of the uninsured to more than 50 million.

And the Senate bill, which includes even deeper cuts over time, is unlikely to be much less disruptive.

The cascading effects of such a retrenchment will reach far beyond those who lose coverage, according to doctors, hospital leaders, insurance executives, patient advocates and state officials across the country. To date, not a single leading patient group or physician organization has supported the GOP repeal bills.

Governors and state legislators, facing huge reductions in federal Medicaid funding, may soon have to decide whether to reduce services, limit who can enroll in the health care safety net or make cuts to other state programs, such as education or transportation.

On Friday, Nevada Gov. Brian Sandoval, a Republican who expanded his state’s Medicaid program through Obamacare, warned that the Senate bill would cost Nevada nearly half a billion dollars.

“That's a cost that the state cannot sustain,” he said.

And though the Medicaid cuts may be phased in over several years, many states that have two-year budgets would have to begin confronting the cuts sooner.

Overall, the House bill slashes more than $800 billion in federal Medicaid spending over the next decade, according to the CBO, slashing close to a quarter of federal aid for a program that now covers more than 70 million poor Americans.

The extent of the cuts in the Senate bill is still unclear, but the Senate version caps federal Medicaid spending even more aggressively over time than the House legislation, fundamentally changing the program’s historic coverage guarantee.

Over the past half-century, the federal government has paid a share of all medical costs incurred by Medicaid patients. But under the GOP plans, that funding would be replaced by fixed payments to states, regardless of what it costs to care for patients.

Under the Senate plan, because that cap would increase only at the rate of inflation, states may bear a larger and larger share of medical costs, which have historically increased faster than inflation.

In addition to the Medicaid reductions, both the House and Senate repeal bills would dramatically scale back financial assistance to low- and moderate-income Americans who buy health plans on Obamacare insurance marketplaces.

Those cuts would make health coverage substantially more expensive for many consumers, forcing some to drop their insurance coverage altogether, independent analyses, including from the CBO, have concluded.

Those coverage losses, in turn, will put new pressures on doctors, clinics and hospitals as they face growing numbers of patients with no insurance who are unable to pay their medical bills.

Marshfield Clinic, a large health system that serves more than 2 million patients in central Wisconsin, is anticipating that passage of the GOP plan would lead to a major increase in the amount of care it would have to provide for free, said Dr. Susan Turney, the system’s chief executive.

At Valley Health, a network of clinics serving mostly poor patients in West Virginia, southern Ohio and eastern Kentucky, fewer patients with insurance would probably force cutbacks in services, such as extended pediatric hours that allow working parents to bring in sick children evenings and weekends.

“There will be kids and families that will suffer, and the health care in our communities will suffer,” said Valley Health Chief Executive Steve L. Shattls.

The strain on hospitals and doctors will reach beyond the health care system.

American employers, which provide health coverage to more than 150 million workers and their families, could see their costs rise as hospitals and physicians try to make up for losses they incur caring for more uninsured patients.

“Ultimately, if there is inadequate insurance coverage, medical providers will try to get the revenue they need by increasing prices,” said David Lansky, head of the Pacific Business Group on Health, a consortium of large West Coast employers, including Boeing, Chevron, Intel and Wells Fargo. “That hits employers.”

It also will probably hit employees, who will see insurance premiums increase and wages stagnate as businesses shift healthcare costs onto workers, as has happened repeatedly in the past. .

In recent years, by contrast, workers’ healthcare costs have increased at historically slow rates, data show.

Insurance markets, too, could see increasing turmoil as states eliminate national standards in the current law that require all plans to cover a list of basic benefits and forbid charging sick patients more, pushing insurance companies back to designing health plans tailored to attract cheaper, healthier consumers.

The CBO’s analysis of the House bill, which is broadly similar to the Senate legislation unveiled last week, estimated that insurance markets serving about a sixth of the country would become unstable in coming years.

Adding to the instability, the Senate bill would eliminate the unpopular Obamacare mandate that all Americans buy insurance, while failing to replace it with any kind of penalty on consumers who don’t get coverage until after they get sick.

Such penalties, which Medicare has long relied on to keep that system financially sound, are widely viewed as critical to functioning insurance markets because they induce younger, healthier people to get coverage.

Before Obamacare, several states, including New York and Washington, saw their insurance markets collapse when state leaders tried to guarantee coverage without any insurance requirement.

“No one in any community in New York wants to see history repeat itself,” said Karen Ignagni, chief executive of EmblemHealth, one of the state’s leading insurers.

Some 1,500 miles away, in Athens, Texas, Dr. Douglas Curran, a family physician, is equally troubled by what he sees happening in Washington.

“When it comes to the politics, I don’t have a dog in the fight,” said Curran, who has been tending to patients in the small city southeast of Dallas for nearly 40 years.

“There is plenty that I’d like to see fixed, but it sure would be nice if we just focused on making sure everyone could get care,” he said. “I just don’t see a lot of that right now."

noam.levey@latimes.com

@noamlevey

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