Trump and the GOP should face it: There’s only one option left to fix health care

by Robert Laszewski, president of Health Policy and Strategy Associates,

Now that the American Health Care Act has been yanked, after GOP leadership failed to rustle up enough votes to get it passed, it is clear that an Obamacare fix cannot be negotiated with hard-line Republican conservatives.

But there is another option for getting a bill passed. President Trump and the Congressional Republican leadership would have a much easier time working with the Democrats—with whom they have more in common.

After almost two months of collaborative effort by the House Republican leadership and the Trump administration, it is now crystal clear that the ideological differences between hard-right conservatives and most Republicans, are so wide, a deal cannot be done that accommodates them.

President Trump and the House leadership crafted an Obamacare repeal and replace bill that would have continued advanceable tax credits for individuals buying their insurance in the marketplace. They also crafted a bill that at least would have provided a “soft landing” for those now covered in the Obamacare Medicaid expansion.

But the hard-right Republicans who scuttled this bill, including most in the Freedom Caucus, don’t want to continue the health-care entitlements. They don’t want Medicaid to cover anyone but the poorest and most disabled for even one more day. They certainly don’t want any able-bodied people who could be working getting any such entitlements. And, they don’t want any premium credit entitlements to help lower and middle-income people to buy health insurance.

At best, they would agree to make health-insurance purchases tax deductible—something that would help those in higher tax brackets but do little or nothing for those who are in the lowest brackets or pay no income taxes.

With a Republican House majority of only 21 votes, these hard line conservatives can scuttle any bill—and for these reasons they have scuttled this one.

The terrain in the Senate is really no different. With a two-seat majority, at least three Republican Senators generally share the views of these hard-right House conservatives—Ted Cruz of Texas, Rand Paul of Kentucky, and Mike Lee of Utah.

Now, the president has threatened to skip fixing Obamacare and let it fail. He will get his wish. Health insurers that I have talked to are already working on their contingency plans for 2018 should Obamacare not be repaired. Things are so unsustainable that the shrinking number of health insurance companies left in the Obamacare market are giving serious thought to whether or not they will even participate.

The short-term Medicaid outlook is better in the wake of this failure. Without a new bill, the program will continue and will be fully funded.

All of this takes us to the Democrats.

Trump and the Republican leadership have said that everyone should at least have access to health insurance. The Democrats generally agree.

Trump and the Republican leadership have said that we should keep the pre-existing condition reforms and kids should be able to stay on their parent’s plans until age-26. The Democrats agree.

Trump and the Republican leadership believe that there should be advanceable tax credits — premium subsidies — available to those in the lower and middle-income categories. The Democrats generally agree.

Trump and the Republican leadership believe that, while continuing to protect consumers, the insurance-market rules need to be made more efficient so that the insurance companies can have the vibrant market they need to offer consumers the insurance products they want. The Democrats generally agree.

I don’t mean to gloss over the very significant differences that remain between Democrats and the Republican leadership. But as a place to start a conversation, the defeat of the Republican health care bill at the hands of the most conservative House members, makes it clear the Democrats have more fundamental agreements with the Republican leadership than the Freedom Caucus ever did.

The only way to get to a solution here is for President Trump and the Republican leadership to recognize who their real potential partners are.

In the end, the only way to a sustainable solution to health-insurance reform is one that has bipartisan support. Without that, the Democrats will just reverse anything the Republicans do once they are inevitably back in power.

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