Dismantling Obamacare

U.S. President-elect Donald Trump has vowed to dismantle key parts of the Affordable Care Act. Details of his plans have not yet emerged, but experts foresee significant change with the likely appointment of a privatization hardliner, Georgia Congressman Tom Price, as Health and Human Services Secretary.

Taking apart Obamacare will be a complex process. U of T health policy researchers warn it’s unrealistic to think that Trump can cherry-pick the most popular aspects to keep – like protecting insurance for people with pre-existing conditions – while discarding the least popular, such as requiring people to buy insurance or pay a fine. That’s because any universal health care system depends on spreading out risk among a large group of people.

“We know that Trump has said on day one of his presidency the Affordable Care Act will be repealed. That’s not going to happen, not on day one,” says Carolyn Tuohy, a professor emeritus in the School of Public Policy and Governance. “It’s very complex, was passed through an incredibly tortuous process and generated hundreds of federal regulations, parallel state legislation and multiple guidelines. Some parts of the Act require 60 votes in the Senate to undo (although the Republicans could change that rule). Unpicking it is not going to happen overnight.” 

Complaints about Obamacare may be commonplace, but perhaps lesser known are the positive impacts on U.S. population health from the addition of 20 million people to the insurance rolls.  

“It’s had enormous impact on the system as a whole,” says G. Ross Baker, a professor in U of T’s Institute of Health Policy, Management and Evaluation.

“It has allowed providers to offer more preventive care, preventing drastic emergencies that lead to emergency room care. There’s evidence that hospital admissions and readmissions have started to decline as a result of the ability to deliver more care to more people.”

If large numbers of people become uninsured again, Baker says, “it’s likely to have a major impact on the overall health of the American population.”

One idea is to replace insurance with medical savings accounts and tax breaks. But this option would be least effective for the low-income people who need it most, since these patients pay fewer taxes and have less money to put aside, says Raisa Deber, a professor in the Institute of Health Policy, Management and Evaluation. Even more importantly, that model won’t do anything for the people who are already sick and need insurance the most, she says -- but are a bad insurance risk on the free market.

“Do they really want to tell people who have coverage that you no longer have it?” Deber asks. “The right wing of the Republican Party doesn’t want any government role whatever. If that ideology takes over, they’ll say you’re on your own, and we see no reason why we should give you anything.”

The Republicans could pass a repeal bill right away, but delay its effective date to give them time to develop an alternative, says Tuohy, but they would have to act fast – if the Democrats take back the Senate in two years, they could derail this process. Whatever the Republicans do is likely to pass much of the burden onto the states, which provide varying levels of access to coverage already. Tuohy believes the best, albeit the least likely, scenario would be for the federal government to fix problems in the existing Obamacare marketplaces to stop insurance companies from leaving by increasing subsidies. This worked to bring more insurance companies into the market when new private alternatives were introduced in the Medicare program in the past, she says.

“We know how to fix these problems, but the likelihood that Republicans would fix Obamacare, rather than replacing it, as promised, is close to zero,” she believes. “Unless they could cast a fix as a replacement – i.e. ‘we’re replacing those marketplaces with ones that work.’”

Regardless of what steps Trump takes, “I think there’s going to be a period of real chaos and a large number of people are going to be worse off, at least in the short run and probably indefinitely” says Tuohy.