Roughly a million Michiganians face uncertainty about their health care coverage following Donald Trump’s surprise presidential victory, and health care experts are divided on how repeal of the Affordable Care Act will play out for them.
About 350,000 state residents are insured through HealthCare.gov, the federal health insurance exchange at the center of President Barack Obama’s law. More than 615,000 are enrolled in the Healthy Michigan Plan, the Medicaid expansion adopted by 31 states under the law.
Trump urged repeal on the campaign trail as Affordable Care Act premiums for next year skyrocketed — Michigan’s average rate hike is 16.7 percent — and the number of insurance and doctor choices dwindled.
But a rough consensus has emerged to keep portions of the Affordable Care Act that protect health coverage for those with pre-existing conditions and allow parents to keep children on their health insurance through age 26. And the New York businessman has promised that either the law known as Obamacare will be amended or it will be repealed and replaced without an interruption in health care coverage.
Trump said in post-election interviews with the Wall Street Journal and CBS’ “60 Minutes” that he wants to keep the pre-existing condition and dependent-children coverage provisions. They are included in proposals floated by House Speaker Paul Ryan of Wisconsin and one introduced by U.S. Rep. Fred Upton of southwest Michigan, Sen. Orrin Hatch of Utah and North Carolina’s Sen. Richard Burr.
Americans have until Dec. 15 to enroll for 2017 plans at HealthCare.Gov. University of Michigan health expert Marianne Udow-Phillips said consumers should continue to enroll because it will take time for Republicans to agree on a replacement plan.
“(Consumers) should take advantage of those benefits and they should not panic,” said Udow-Phillips, director of the Center for Healthcare Research and Transformation at the University of Michigan. “Regardless of what they decide to do or not do, they have a fair amount of work to do. I would be extremely surprised if they eliminated the exchanges in the middle of the plan year.”
An Upton spokesman said the St. Joseph Republican congressman is working to ensure there will be a transition period to protect consumers currently covered by the federal law.
“My focus is on ensuring Michiganders can benefit from better choices at lower costs. I am committed to ensuring health care insurance markets provide more affordable options for families and small businesses, while protecting Americans with pre-existing conditions,” said Upton, who chairs the House Commerce and Energy Committee, in a statement.
John Graham, a senior fellow with the conservative National Center for Policy Analysis, said “the forces to preserve the status quo are huge” in Washington, D.C., but there will be a political price to pay at midterm elections if Republicans don’t quickly repeal Obama’s health care law.
“If they don’t repeal through reconciliation quickly in the first hundred days, that’s a political bombshell because that’s what they’ve been campaigning on for the last six years,” Graham said.
Crucial decision looms
Trump faces a pivotal decision in January on a federal lawsuit called House v. Burwell that could abruptly halt Obamacare. A federal appeals court will determine the legality of the health insurance subsidies and tax credits that make health insurance affordable for most people who purchase their plans on the insurance exchange.
A federal judge ruled in favor of a House Republican challenge of the subsidies, saying the law doesn’t include a specific appropriation authorizing the payments. The Obama administration has appealed, arguing the law automatically appropriates the funding. The final filing of briefs happens on Jan. 19 — one day before Trump takes office.
As president, Trump could withdraw the government’s appeal, allow the lower court ruling to stand and bring subsidies to a halt. In 2015, about 8.3 million individuals who purchased HealthCare.gov plans received subsidies averaging $270 a month — or about 84 percent of 9.9 million consumers with the plans.
Nicole Bednarski, 28, a working single mom in Ypsilanti Township, has been planning to purchase an exchange plan for next year because she will qualify for tax credits to help pay her premiums. Now, she said she is “terribly concerned.”
“(The Affordable Care Act) needs to be amended and changed ...,” Bednarski said, “not taken away.”
The potential loss of subsidies and tax credits also concerns health insurers.
Ending subsidies would hurt insurers because they would be stuck paying additional costs when consumers couldn’t make the premium payments in the absence of federal aid, said Richard Murdock, executive director at Michigan Association of Health Plans, the industry group that represents most health insurers.
“The magnitude of how many people on the exchange have a subsidy makes it a big deal,” Murdock said.
Another uncertainty are the plans of Trump and congressional Republicans for expanded Medicaid, which provides health insurance for low-income adults including more than 615,00 in Michigan. Nineteen states — including Texas, Tennessee and Florida — refused to adopt the program.
Michigan Gov. Rick Snyder was among a small number of GOP governors who bucked party lines to support the expansion, even battling some fellow Republicans in the state House and Senate to push through the Healthy Michigan Plan in September 2013. The state obtained federal waivers that allow Michigan to require small payments by recipients toward their health care costs.
Asked if planning is underway for the potential loss of expanded Medicaid funding, Snyder spokesman Ari Adler said, “We aren’t going to spend time on hypotheticals at this point, but going forward we will work closely with the federal government to convey the successes of Healthy Michigan.”
GOP replacement plans would give the states more control over health care and strip away layers of Affordable Care Act regulations.
Trump would give block grants to states and let them decide how best to provide health care to low-income residents. Ryan also would give states control of Medicaid and allow them to choose between a block grant or per-capita funding.
Under the Upton-Hatch-Burr proposal, Medicaid payments to states would be capped and limited to pregnant women, poor families with children and the disabled.
Currently, any adult with an income at or below 133 percent of the federal poverty level, about $16,000 annually, can qualify for expanded Medicaid. Ryan’s plan would allow states to limit eligibility to those who are working or in school.
“Some of those states, if given the opportunity, would be more willing to do this under the Republican administration than they were with Obama in office,” said Dr. John Ayanian, professor of medicine at UM and director of the Institute for Healthcare Policy & Innovation, about the 19 states that haven’t expanded Medicaid.
Trump and Ryan use different ways to try to increase affordability. They both would create health risk pools to enable carriers to share the cost of health care for elderly and sick consumers, let insurance companies compete across state lines and reform the federal Food and Drug Administration to make it easier to bring new treatments to market.
Like Trump, Ryan wants to expand health savings accounts. Under his plan, the speaker would relax restrictions on how the money can be spent and increase the amount consumers can deposit in their accounts.
The Upton and Ryan plans would provide advanced tax credits to make insurance more affordable, with the speaker arguing he would make them generous enough to cover the cost of a “pre-Obamacare” health insurance policy. People who don’t spend their full tax credit on insurance could deposit the difference in their health savings account.
Under the Upton-Hatch-Burr proposal, the value of tax credits would decline for those with higher incomes.
Under the Upton alternative, the state could decide to automatically enroll those who don’t sign up for a health plan in a default plan that costs the same amount as the tax credit.
Asked what he thinks of the GOP proposals, Ayanian of UM said he’s “reserving judgment.”
“It will be critical to see how the negotiations play out,” he said. “My hope is that there will be an opportunity for bipartisan agreement to address some of the polarization we’ve had over the past several years.