After seven years and what feels like as many failed replacement bills, Republicans find themselves up against the clock. Open enrollment for 2018 health insurance begins November 1, 2017. Insurers have to make a decision on whether or not to sell plans on the ACA exchanges by September 27. They have to submit final 2018 premium proposals by August 16. Insurers need some form assurance they'll have federal support if they offer Obamacare plans. Until then, premium predictions will vary wildly and prices may skyrocket in 2018. Some insurers may pull out altogether.
After nearly a decade of resistance, Republicans now have to work with Democrats and rush to a temporary solution. What you'll notice is that neither the House nor the Senate have proposed any actual legislation, simply plans. And it's not clear that the plans are much further-looking than 2018.
For all the talk of price spikes under the ACA, according to insurers, uncertainty about the law's future accounts for a big part of the volatility.
Here's what needs to be addressed before Obamacare can be truly stablized:
- Enforce the individual mandate. It's a relatively unpopular part of Obamacare, but the individual mandate—the tax penalty starting at $695 for adults who don't have health insurance—is crucial in funding health care. The healthy and the sick alike have to sign up for the system to work. The Obama administration was lax in enforcing it, and the Trump administration has indicated they'll do even less. Neither Congressional plan mentions the mandate, so its status – whether it'll be disregarded or officially in place, but not enforced – is unknown.
- Make the funds for cost-sharing reductions a permanent part of the legislation. As it stands, that money is spent at the discretion of the president. And President Trump has stated several times that he's willing to pull that funding to demolish Obamacare. While both the Problem Solver Caucus' plan and Sen. Alexander's remarks show support for CSRs, real action has to be taken to keep them in place. The GOPs House v. Price suit that was brought against the Obama administration to kill that funding needs to be resolved, and legislative (rather than executive) action needs to ensure that CSRs aren't under constant threat.
- Focus on what matters. In the Problem Solver Caucus' plan, there are concessions made to both sides. Many seem to be in place simply to bring on support rather than meaningful change. Repealing the medical device tax won't substantially change anything; increasing the employer mandate minimum won't have a huge effect either, since many employers with more than 50 workers provided health insurance before Obamacare; and insurers already have the option to sell across state lines – they simply don't want to. Allowing for flexibility in "innovation waivers" is hard to judge, because it depends on what said innovations are. Congress must not lose sight of which changes are impactful — and which are just shuffling chairs on the Titanic.
- Address Medicaid expansion. In 2012 the Supreme Court upheld the ACA, but struck down its planned mandatory expansion of Medicaid funds, leaving states to decide whether to accept more Medicaid funding. One solution to health-care woes by those on the left is a "Medicaid for all" system. Some states are attempting to test out this sort of system. Many Republican states, however, have opted against Medicaid expansion despite the tangible benefits to low-income citizens. Neither Congressional plan outlines a way to square up this discrepancy, so the disparity between states with and without expanded Medicaid will continue.
Enacting a system that works beyond the 2018 coverage year means the same issues don't have to be revisited annually. It also brings predictability to the market, which can help lower prices in the near term. Moreover, it makes future health insurance conversations that much easier.
Despite the bipartisanship currently on display, there are still many Democrats for whom single payer is the eventual goal. Most Republicans – including the administration – want a repeal and replacement of Obamacare. Even if 2018 works out, the fighting won't stop. Having a stable, affordable market in place will help shield against more volatility next time the argument starts.
President Trump might think he can pass the buck for Obamacare "imploding," but his fellow Republicans aren't so sure – because polls have shown the public is holding the GOP accountable at this point. Having a fleshed-out, stable plan for making the current market-based system work far into the future will quell some of these arguments, making politicians, insurers, and the American public less anxious about healthcare.
Commentary by Jennifer Fitzgerald, the CEO and co-founder of PolicyGenius, an independent digital insurance company for consumers. Previously, she was a junior partner at McKinsey & Company where she advised Fortune 100 financial services companies on marketing and strategy. She is a graduate of Columbia Law School and Florida State University. Follow her on Twitter @jenlfitzgerald.
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