Obamacare repeal plan stokes fears of market collapse

http://www.politico.com/story/2016/11/obamacare-repeal-market-collapses-231653?utm_campaign=CHL%3A+Daily+Edition&utm_source=hs_email&utm_medium=email&utm_content=37969677&_hsenc=p2ANqtz–Wv-16E4bE7iT4jhF2j2QKWBhCJZPBLuy-TBTKYxxVNSL8KAVSAyRmDFndXujD1e6r6JMx9BX3zcgMSf3biYBAMLyJug&_hsmi=37969677

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Republicans warned for years that Obamacare would blow up the nation’s individual insurance market. Instead, their own rush to repeal the health care law may be what triggers that death spiral.

GOP lawmakers say they plan to repeal the Affordable Care Act as soon as President-elect Donald Trump takes office, including a transition period of a year or two before it takes effect. That way, they satisfy their base while giving notice to 20 million Obamacare customers that they must find other coverage options.

But repealing the law without a replacement is likely to spook health insurers, who might bolt from the markets prematurely to avoid losses as some people stop paying their premiums, while other people rush to have expensive medical procedures before losing coverage. Insurers would have little incentive to stick around without knowing what to expect at the end of the transition. And that could spell chaos for consumers.

“The discussion right now about repeal and replacement is making the market very, very nervous,” said Washington Insurance Commissioner Mike Kreidler, a Democrat. “I would not be surprised to see the potential for a stampede to exit the market.”

Even if Congress delays immediate action to kill the health care law, Obamacare insurers would have just a few months to decide whether to stay in the law’s marketplaces for 2018. Deep uncertainty about the Republicans’ Obamacare replacement could drive out those companies, cutting off insurance for, potentially, millions of customers.

“A repeal that kicks the can on replace would put the market in serious jeopardy, and the American people will hold them accountable for the results,” Topher Spiro, who heads health policy at the left-leaning Center for American Progress, said on a call with Obamacare supporters last week.

Uncertainty about Obamacare’s future is occurring against the backdrop of strong demand for coverage. More than 1 million people signed up through HealthCare.gov in the first two weeks of the current enrollment season, including 100,000 who enrolled the day after the election, according to the Department of Health and Human Services. The administration projects that 13.8 million people will participate this season, which ends about two weeks after Trump takes office. Millions more — including young adults on their parents’ policies and those in expanded Medicaid — will also get coverage this cycle.

Uncertain Fate Of Health Law Giving Health Industry Heartburn

Uncertain Fate Of Health Law Giving Health Industry Heartburn

WASHINGTON, DC - NOVEMBER 10:  President-elect Donald Trump (L) talks after a meeting with U.S. President Barack Obama (R) in the Oval Office November 10, 2016 in Washington, DC. Trump is scheduled to meet with members of the Republican leadership in Congress later today on Capitol Hill.  (Photo by Win McNamee/Getty Images)

Six years into building its business around the Affordable Care Act, the nation’s $3 trillion health care industry may be losing that political playbook.

Industry leaders, like many voters, were stunned by the election of Donald Trump and unprepared for Republicans’ plans to “repeal and replace” Obamacare.

In addition, Trump’s vague and sometimes conflicting statements on health policy have left industry officials guessing as to the details of any substitute for the federal health law.

“It will be repealed and replaced,” Trump said Sunday in an interview on CBS’ “60 Minutes.” At the same time, he vowed to preserve popular provisions of the law like ensuring that people with preexisting conditions can get insurance and allowing young adults to stay on their parents’ health plans.

Charles (Chip) Kahn, chief executive of the Federation of American Hospitals, said that before the election, health groups had not been meeting with Republicans about a rewrite of the law “because the working assumption was we had a program that wasn’t going anywhere. That working assumption is now no longer operative.”

Upending the health law plays havoc with a health industry that had invested heavily in strategies geared to the ACA’s financial incentives. The flipped script initially left some industry groups speechless. Others issued bland statements pledging cooperation with the next administration as they awaited greater clarity from the next president.

Said Donald Crane, who heads CAPG, a national trade group for physician organizations: “Nobody was ready for this. We didn’t have a Plan B.”

The results appear to have rattled the fragile industry coalition that the Obama administration carefully crafted to support the law. Looking ahead, some health sectors might have even more reason to worry.

The hospital industry may be the most vulnerable to proposed changes, which could result in millions of Americans losing health coverage, both through the insurance exchanges and expansion in the Medicaid program for those with lower incomes.

Big Changes and Big Risks Are Ahead for Health Policy

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The election outcome itself could create more problems for the ACA. The insurance plans sold on the law’s exchanges have already experienced substantial losses due to adverse selection, leading many insurance companies to pull back on their participation. The prospect of a Trump administration steering ACA implementation may be enough to convince some of the insurers still offering products on the exchanges in 2017 to rethink their plans. If more insurance companies head for the exits, the exchanges could become even less stable than they already are.

The “replace” part of “repeal and replace” has always been the tricky part for ACA opponents, and that will also be true for the incoming Trump administration. During the campaign, Trump offered only the vaguest outline of a plan that wouldn’t come close to serving as a starting point for a workable proposal. The ACA, for all of its problems, brought many low-income households into insurance coverage, through an expansion of the Medicaid program and through heavy subsidization of the insurance plans offered on the exchanges. Unless Trump wants to preside over a massive increase in the number of Americans without health insurance during his presidency, he will have to offer a plan that ensures households with low incomes can secure health insurance in some new way.

Analysis: Time for GOP to prove it has a better plan for healthcare reform

http://www.fiercehealthcare.com/payer/analysis-time-for-gop-to-prove-it-has-a-better-plan-for-healthcare-reform?utm_medium=nl&utm_source=internal&mrkid=959610&mkt_tok=eyJpIjoiTnpkaFpqRm1ZVEZpWkdZMiIsInQiOiJxY1NBT1ZDbGdDQWsxVzRQQ21iOVwvcEVkOFdDVTBIUG9hZWllQ0tiYmFuM2lUVU52Y2JGWkxnNW9BWDJhTWNZSTVTR2QwVmdTYWdIQkFPWGdxZ3FRWlwvRXVuSFFvZ2pKa3NaTUlwU0M1YmVJPSJ9

With Donald Trump headed to the White House and his party firmly in control of Congress, Republicans will finally have a chance to prove what they’ve been saying all along: that they can produce a better version of healthcare reform than the Affordable Care Act.

It’s clear that the ACA is as imperiled as it has ever been. Trump has fervently vowed to repeal it–and with Republican control of both chambers of Congress, he may well get his wish. After all, the law’s most visible component, the exchanges, are on shaky ground as it is, with premiums rising and some health insurers retreating from the marketplaces.

Plus, President Barack Obama’s last attempt at convincing Republicans to work on fixing the ACA–not repealing it–fell on deaf ears even before the party’s resounding victory Tuesday.

What gets lost in all the talk about the ACA’s uncertain future, though, is the fact that while some insurers have struggled to make a profit in the individual marketplaces, there are other aspects of the law to which they have become quite attached.

Take Medicaid expansion, an idea championed by Democrats (and even once embraced by Vice President-Elect Mike Pence) that has been a boon to insurance companies in the form of lucrative managed care contracts. Some companies that specialize in slimmed-down Medicaid plans have also thrived on the exchanges where others have floundered.

Then there’s the ACA’s provisions that encourage the transition to value-based payments, which insurers have embraced and largely retooled their business models to reflect. Accountable care organizations, for example, have sprung up like wildfire, producing promising results for some companies.

A wholesale repeal of the ACA would also erase the law’s historic gains in reducing the uninsured rate. Though many of the newly insured have turned out to be costlier to cover than expected, such a move would still rob insurers of millions of new customers.

The question, then, becomes what will replace the law–and that’s where it gets interesting.

Trump has a plan, but it is short on details. Perhaps most visibly, he has advocated for selling insurance across state lines–a timeworn GOP talking point that many experts agree is not feasible. He would also repeal Medicaid expansion and convert Medicaid federal matching funds into a block grant, the latter of which would drastically cut Medicaid funding and coverage.

One analysis from The Commonwealth Fund says that his plan could add nearly 20 million peopleto the ranks of the uninsured, and even more if his Medicaid proposals come to fruition.

Obamacare defenders vow ‘total war’

http://www.politico.com/story/2016/11/obamacare-defenders-vow-total-war-231164

Donald Trump is pictured. | Getty

Shell-shocked Democrats on Capitol Hill are preparing to make a fight for Obamacare their top priority in the opening days of the Trump administration, with leading advocacy groups ready to wage “total war” to defend President Barack Obama’s universal health care program and his domestic policy legacy.

“We’ve got the battle of our lifetime ahead of us,” Ron Pollack, executive director of advocacy group Families USA, said the day after Donald Trump was elected on a pledge to repeal the Affordable Care Act, which now the law that covers 22 million people. “We’re going to have a huge number of organizations from all across the country that will participate in this effort.

But their options are limited. They have enough votes to block a total repeal of the law on Day One of a Trump administration. But they can’t block Republicans from passing targeted legislation in the coming months, and Trump — like Obama before him — can pick up a pen as early as Jan. 20 and use executive powers to block, change, or put on hold key elements of the massive six-year-old legislation.

The road to repeal is more complex than Trump acknowledged on the campaign trail. The law is baked into the health care system, touching every American’s life and a fifth of the economy.

But with the Republican sweep of both the executive and legislative branches, expectations for big and bold action are high.

California Faces Major Reversal If Trump, Congress Scrap Health Law

California Faces Major Reversal If Trump, Congress Scrap Health Law

Attendees speak with heath care volunteers during the WeConnect Health Enrollment Information & Wellness Event in Oakland, California, U.S., on Saturday, Sept. 21, 2013. The battle over Obamacare is taking on political importance as Democrats hope a successful roll-out among Hispanics will further bind those voters to the Democratic Party and undermine Republican efforts to build more support before the 2016 presidential election. Photographer: David Paul Morris/Bloomberg via Getty Images

California has a lot to lose if President-elect Donald Trump and the Republican-led Congress fulfill their campaign pledge to repeal Obamacare.

The Golden State fully embraced the Affordable Care Act by expanding Medicaid coverage for the poor and creating its own health insurance exchange for about 1.4 million enrollees. Supporters held California up as proof the health law could work as intended.

But now President Barack Obama’s signature law is in serious jeopardy and California officials are left wondering what Republicans in Washington may put in its place.

“There is no doubt that Obamacare is dead,” said Robert Laszewski, a health care consultant and expert on the California insurance market. “The only question is just exactly how Republicans will get rid of it.”

Health policy experts don’t expect Republicans to immediately kick millions of people off their insurance policies. Instead, they predict lawmakers may repeal parts of the law and allow for some transition period for consumers while a replacement plan is put together.

Still, the personal and financial impact for the state could be jarring. The number of uninsured Californians would more than double to 7.5 million people if the Affordable Care Act was repealed, according to a recent study by the Urban Institute.

Researchers also said California stands to lose an estimated $15 billion annually in federal funding for Medicaid expansion and insurance subsidies — more than any other state. That loss of federal money would make it difficult for California to pursue health reform on its own.

Winners and losers in the health-care industry under President Trump

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With much about President-elect Donald Trump’s health-care agenda still unclear, the health-care industry’s initial response to his election has been scattered. Hospital stocks were down. Health insurers’ stock prices were mixed. Pharmaceutical and biotech stocks, on the other hand, got a big bump.

Trump’s clearest policy position in health care has been his commitment to repealing the Affordable Care Act and replacing it with another policy. But the responses to his election varied in large part because the details of exactly what would replace the Affordable Care Act and how that transition would occur have been vague. Without knowing those details, it’s hard for investors to have a clear response, said Benjamin Isgur, a leader in the PwC Health Research Institute.

“These health organizations are like large ships, and you can’t turn them on a dime,” Isgur said. “When you think back to what it took to get ready for the ACA, for many health-care companies, it was two to three years of developing plans and provider networks and marketing plans. . . . There’s a lot of work that is required to implement any new program.”

 

Why selling insurance across state lines is an unlikely solution

http://www.healthcaredive.com/news/why-selling-insurance-across-state-lines-is-an-unlikely-solution/429610/

Proposals to sell insurance across state lines have been floating around for a while. In 2005, Congress considered the first proposal to sell insurance across state lines at the federal level. Many of the candidates running in the recent Republican presidential primary endorsed the idea, including Scott Walker, Marco Rubio, Ted Cruz and Rand Paul. A proposal to sell insurance across state lines is a core component of Republican presidential nominee Donald Trump’s healthcare agenda.

With election day approaching and attention returning to plans that would allow the sale of insurance across state lines, it is worth asking whether these proposals would be effective.

Healthcare mergers and acquisitions in 2016: Running list

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