WASHINGTON — Senate Majority Leader Mitch McConnell warned last week that Republicans’ failure to pass comprehensive health care reform could have dire consequences. He even warned of one scenario rarely seen here lately: bipartisanship.
There’s no guarantee that a holistic, bipartisan health care bill could succeed should McConnell’s nearly single-handed effort to repeal much of the Affordable Care Act fail. But Democrats at least claim they are willing to compromise.
“We’re all there,” Sen. Sherrod Brown (D-Ohio) said of his party’s willingness to work on fixes to existing law. “I don’t know what it ultimately looks like, but clearly we stabilize the insurance pool, clearly we want to get more young, healthy people in. Clearly we need to go after the price of prescription drugs. … All kinds of things.”
It is entirely possible, of course, that McConnell could wrangle enough votes to enact a GOP plan, and that a compromise approach will prove unnecessary.
And even if the Republican effort fails, members of both parties could decide to do nothing at all, instead allowing uncertainty to reign and cause the insurance market to struggle, playing the blame game through the midterm elections in November 2018.
But there is at least a faint scent of bipartisanship in the air in Washington, and Democratic legislators in recent weeks have hinted at a number of long-ignored policy ideas that, under the right circumstances, could form the basis for a health bill that garners the requisite votes in the Senate and House.
What might that bill look like? Democrats don’t have a single answer. But STAT’s interviews with senators, lobbyists, Capitol Hill staffers, and outside analysts at least provide some outlines of the picture, however blurry it may be.
Any compromise would likely start with insurance reform — and with helping to lower premiums or stabilize insurance markets.
At least 41,000 people in some 61 counties are at risk of having no insurance options on HealthCare.gov — and there’s no backup plan in federal law. Many others could see sizable jumps in their monthly health insurance premiums for next year.
Democrats seem more willing than ever to acknowledge the ACA’s flaws. There is increasing willingness on their part to allow states more flexibility in structuring their insurance exchanges; some hints at modifying the strictness of essential health benefit requirements; and perhaps even allowing insurers to widen age bands — ratios that dictate how much more they can charge older, sicker patients as compared to younger, healthier ones.
There are several health policy solutions that both parties agree on — at least in the abstract.
Republican repeal bills in the House and Senate include massive federal financing for so-called reinsurance programs that help offset the costs of some of the sickest Americans. Obamacare, too, included a temporary reinsurance program — and several Democratic senators offered new legislation this month that would focus on that solution.
“One of the biggest challenges insurance companies have faced is managing their risk,” said Sen. Chris Coons (D-Del.), pointing to the reinsurance bill he co-sponsored with two other Democrats.
One related idea from Sen. Lindsey Graham (R-S.C.) would place those diagnosed with any of the five or so most expensive health conditions in a federally managed risk pool so healthier Americans need not subsidize their insurance.
“How many of those people do we have on the risk pool?” said Sen. Heidi Heitkamp (D-N.D.), who has responded enthusiastically to Graham’s concept. “How do we get them off the risk pool so that insurance becomes affordable for a whole lot more people? … There’s a ton of stuff we could be talking about if we lay down some facts and lay down some priorities.”
Mandates, essential health benefits, and more
Beyond market stability, little is clear. But many Democrats — if Republicans back off proposals to reduce future Medicaid spending — appear ready to negotiate on more granular policy elements.
Among those is flexibility on the individual and employer mandates. Even the left-leaning Urban Institute in January recommended replacing the ACA’s unpopular individual mandate with a version of the premium penalties currently imposed for late enrollment by some Medicare programs. The version of the health care bill passed by the House would have allowed insurers to charge larger premium penalties — a 30-percent markup to those who failed to maintain continuous coverage — while the pending Senate version would impose a six-month waiting period for those looking to re-enter the market.
“I think the six-month waiting period is industry consensus — that’s what [the individual mandate] needs to be replaced with,” said Katie Allen, the president of the free-market Council for Affordable Health Coverage.
There is room to work, it seems, on the employer side as well.
Democrats may be open to increasing the number of employees at which some businesses would be compelled to offer health insurance, said Sen. Angus King (I-Maine), who caucuses with the Democrats. Current law forces most companies with 50 or more employees to offer health insurance, but some employers close to that threshold say the mandate makes it difficult to do business successfully.
Of course, all of these proposals cost money. How Congress would pay for them, even if a policy consensus is unexpectedly reached, remains a major question — at least, to some.
“What, you mean instead of a tax cut of $800 billion for rich people?” Brown said, referring to the pending Republican bill. “[Some proposals cost] some money, but it’s costing a lot more to have this volatility.”
Another Republican policy concept is a bill long pushed by pair of moderate Republicans — Susan Collins of Maine and Bill Cassidy of Louisiana — and long ignored by everyone else. One of its provisions would allow some states to opt out of essential health benefit requirements, which Democrats have no desire to permit. Allowing a select number of slight easements in those requirements, however, is not out of the question.
Still to be determined: whether Democrats can stomach the idea of widening existing age bands from 3:1 to 5:1, meaning older, sicker consumers would pay higher premiums than younger healthier ones at a wider disparity. Many senators, when asked, said the question was premature and that they preferred first to focus on market-stabilization measures.
Another carrot Democrats could offer the right wing is the expansion of both 1332 and 1115 waivers for ACA restrictions. Such exemptions would allow states to restructure their health exchanges so long as coverage levels remained roughly equivalent, and to spend Medicaid funds in ways otherwise unauthorized but that the federal government judges will yield at least equivalent outcomes. Besides boilerplate language about allowing states more flexibility, Democrats so far have had little to say.
There are also some parts of Obamacare that have long been unpopular with a subset of Democratic lawmakers. Efforts to repeal the so-called Cadillac tax on high-cost plans have earned the support of as many as 90 senators. The dreaded Independent Payment Advisory Board, which could institute Medicare cuts as early as this year, is also unpopular with both parties.
Democrats were also largely silent or vague when asked for bipartisan solutions to bring down drug prices. That’s hardly a surprise — after all, other than a belief that Medicare should be able to negotiate drug prices, Democrats don’t uniformly agree on a solution to sky-high pharmaceutical costs.
But both Republican and Democratic members of Congress agree on the need for reform, even if they don’t know exactly how to get there.
There are various bills in play proposing more transparency requirements for pharmacy benefit managers’ price structures, a longstanding proposal to allow pharmaceutical reimportation from Canada to increase competition; and a proposal from Ron Wyden (D-Ore.) to force drug makers to justify substantial price hikes.
If there’s enough pressure for the Senate to act on a comprehensive health care bill, it could present an opportunity for any of those parties to shoehorn in a drug-pricing proposal that other members would feel compelled to vote for.
The issue has otherwise stagnated in Congress, with Sen. Lamar Alexander (R-Tenn.), who chairs the Senate committee overseeing most health policy, pledging not to hold further hearings on drug pricing as he “awaits a bipartisan attitude” on health care.
The day after those comments, Sen. Bernie Sanders (I-Vt.) wrote an open letter to Alexander asking him to “end backroom deals” on health care.
The current Senate bill initially included a $2 billion fund meant essentially as a peace offering to Republican senators worried about the impact of Medicaid spending reductions on access to addiction treatment. The current, pending draft reportedly increased that sum to $45 billion. If the GOP bill fails and leaves Medicaid untouched, calls for that level of spending may dissipate. Still, the opioid epidemic remains an issue of bipartisan concern and could present lawmakers with an opportunity.
The House’s Bipartisan Heroin Task Force last week unveiled a package of legislation that would provide hundreds of millions of dollars to bolster addiction treatment efforts. It is not what’s needed, many experts say, but Republicans have shown at least some willingness to bolster spending on the crisis.
Sen. Roy Blunt (R-Mo.), who chairs the Senate’s health appropriations subcommittee, told STAT last month that he doubted there was an efficient mechanism for spending money on the scale currently included in the bill. But if members can pass a bipartisan health bill, it seems that added funding for addiction treatment and prevention would be among the most politically popular elements.
The bottom line
In the end, the negotiations all boil down to a simple question: whether the two parties can compromise. True to the Senate’s partisan tone of late, members’ responses to that question were revealingly different.
“We don’t see much energy on the part of the other side to come to the table with us, unless it’s 100 percent their way,” said Sen. Orrin Hatch (R-Utah), who chairs the Senate Finance Committee tasked — at least in theory — with drafting the Senate legislation. “And I don’t even see that effort.”
Democrats say they’re willing to make that effort. But for now they’re also unwilling to budge on a central plank of the GOP’s plan: rolling back the expansion of Medicaid and reducing its spending increase rate.
Sen. Jon Tester (D-Mont.) said he was “absolutely” willing to compromise.
But, he added, “if the price of admission is throwing 22 million people off of insurance, I’m out.”