A projection estimates the ‘skinny’ legislation would result in 16 million more uninsured by 2018—mainly by ending the individual mandate.

July 28—The Senate narrowly rejected a so-called skinny healthcare reform bill that drew opposition from insurance and hospital advocates.

The Senate early Friday voted 49-51 to reject a scaled-back repeal of parts of the Affordable Care Act (ACA). Senate Majority Leader Mitch McConnell (R-Ky.) said "it's time to move on" from health reform, although it was unclear whether other healthcare legislation could follow.

Meanwhile, America’s Essential Hospitals (AEH) said the vote was “welcome news.” 

“The health and economic stability of millions of people depend on our elected leaders working together to preserve gains in coverage and ensure hospitals have the resources necessary to meet their mission of caring for those in need,” Bruce Siegel, MD, president and CEO of AEH, said in a written statement.

After the vote, Darrell Kirch, MD, president and CEO of the Association of American Medical Colleges, said “The most immediate concern is stabilizing the health insurance market through continued, predictable funding of cost-sharing subsidies. Without these subsidies, the markets will face significant strains that could be devastating for patients, especially those who are most vulnerable.”

The details of the stripped-down legislation to repeal and replace parts of the ACA remained unclear until shortly before legislators moved to pass the measure early Friday morning. Senate Republican leaders were apparently hoping the approach simply would allow the repeal-and-replace bill to reach a conference committee in the House of Representatives, where it could be fleshed out. Any bill the bicameral conference committee approved would also need approval from majorities in both legislative chambers.

Despite the lack of specificity about the provisions in the skinny bill, America’s Health Insurance Plans (AHIP) warned in a July 27 letter against “proposals that would eliminate key elements of the current law without new stabilizing solutions.”

According to published reports, the skinny bill included:

  • repealing individual and temporarily repeal employer mandates;
  • repealing the medical device tax;
  • ending federal funding for one year of Planned Parenthood;
  • eliminating the Prevention and Public Health Fund; and
  • authorizing an expedited 1332 waiver process, which could allow states to cut essential health benefits and other ACA provisions.

There is no indication that the bill would affect Medicaid, which has grown to nearly 75 million enrollees, according to the latest federal data. Concerns that earlier Republican bills would cut Medicaid enrollments drove hospital opposition to the repeal-and-replace efforts.

The Senate earlier this week rejected two bills with major Medicaid spending reductions: the Better Care Reconciliation Act, rejected 57 to 43; and the Obamacare Repeal Reconciliation Act, rejected 55 to 45.

“While it doesn’t directly affect Medicaid, it still would badly undermine coverage and access by destabilizing the private marketplace,” Siegel said.

Insurer, Hospital Opposition

The AHIP letter appeared to be focused on the expected adverse impact on the ACA marketplaces of repealing the individual mandate—as well as the lack of various new funding supports.

“We would oppose an approach that eliminates the individual coverage requirement, does not offer alternative continuous coverage solutions, and does not include measures to immediately stabilize the individual market,” Marilyn Tavenner, president and CEO of AHIP, wrote in the letter.

Such concerns could stem in part from a new Congressional Budget Office (CBO) estimate requested by Senate Democrats about the effects of a skinny-like proposal that included repeal of the ACA's coverage mandates and medical device tax. That project concluded the skinny legislation would increase the number of uninsured by 16 million by 2018. Additionally, the CBO previously estimated that repealing the individual mandate would increase ACA marketplace plan premiums by about 20 percent relative to the current law.

Siegel noted that the CBO estimates include 7 million fewer Medicaid enrollees by 2023, who are expected to drop coverage because of the end of the individual mandate, according to one health policy analyst.

“It also would drive up uncompensated care at hospitals as people leave the insurance market and, instead, rely on costly emergency departments for their health care needs,” Siegel said.

Lowell Brown, who advises hospitals as a partner at the law firm Arent Fox, said it is unclear why so many would drop Medicaid from just the loss of the individual mandate.

“If you’re a hospital, it’s better to have people with some insurance, even if it is not very good—and Medicaid is not very good insurance—than it is to have a bunch of people with no insurance,” Brown said.

Rich Daly is a senior writer/editor in HFMA’s Washington, D.C., office. Follow Rich on Twitter: @rdalyhealthcare

Publication Date: Friday, July 28, 2017