May 10, 2017
The House passed its Obamacare repeal bill, so what happens next?
Following months of controversial debate, high-profile negotiations, and legislative amendments, last week House Republicans passed their bill to repeal and replace key elements of Obamacare by a 217-213 margin. Twenty Republicans joined all 193 House Democrats in opposing the measure, which is officially titled The American Health Care Act (AHCA.) The bill now heads to the U.S. Senate where it faces a very uncertain path towards passing into law.
Holding a slim 52-48 margin in the Senate, the GOP can only afford to lose the support of two senators to pass the bill (assuming no Democratic support and the Vice President's vote as the tie-breaker). Many predict this will be a difficult task given that Republican senators from both the moderate and conservative wings of the party have already publicly stated their opposition and intent to amend different key provisions of the House bill, including those related to Medicaid and pre-existing conditions. Others have called for "starting from scratch" to completely rewrite the legislation. In response, Senate Majority Leader Mitch McConnell (R, KY) has formed a working group of a dozen GOP Senators to write a new bill. The White House will pressure the Senate to move quickly, but McConnell has avoided setting a timeline for Senate action and most industry experts expect the Senate to live up to its reputation as the more "deliberate" (aka slow) legislative body this summer as it considers these healthcare issues.
Still a long way from Trump’s desk
Further complicating matters, any amended bill that does clear the Senate would have to go back through the House to become law. To reach President Trump's desk to be signed into law, any amended bill that does clear the Senate would need to either: (a) pass the House again or (b) be reconciled by House and Senate negotiators and then pass both the House and Senate again. And as evidenced by the last two months of negotiations in the House, any tweaks to the House bill could threaten the fragile coalition of support that secured the bill's two-vote margin of victory last week.
Politically, regardless of what transpires in the Senate, the House vote ensured that healthcare will be a top political issue through next year's midterm elections. Several House members have already faced contentious town hall meetings and political attack ads targeting their votes. Meanwhile, the stability of the current Obamacare insurance exchanges will continue to come under question in the coming weeks and months as insurers announce their final plans for 2018 open enrollment amidst this cloud of political uncertainty.
What does it all mean for healthcare providers?
Despite the House vote, it is still unclear whether a Republican "repeal and replace" bill will become law this year. Given the Senate dynamics, it is also unclear what such a bill would ultimately look like but the AHCA does establish a legislative framework grounded in Republican principles that is likely to hold form.
Likely changes include those related to Medicaid eligibility, individual insurance market subsidies, and regulations impacting insurance offerings. Providers with large Medicaid and individual market patient populations would be most impacted by the resulting coverage changes, while insurance reforms focused on lowering premiums in exchange for fewer covered benefits and/or higher beneficiary payments would likely continue to push patients to act more as consumers and seek greater value from their healthcare dollars. All healthcare is local, so the specific impact of various legislative provisions would vary greatly based on individual practice dynamics. Also, notably absent from these legislative debates has been any discussion of repealing the government driven shift from volume to value based reimbursement.
Beyond this legislation, it is also important to remember that the Republican "repeal and replace" strategy also includes administrative actions by HHS Secretary Tom Price and additional legislation that would require 60 votes in the Senate. So regardless of how quick or slow the AHCA moves through the Senate, we will continue to see "repeal and replace" policies implemented throughout this year. All in all, stay tuned!