by Mitch Kokai
Senior Political Analyst, John Locke Foundation
iF: You are one of the foremost experts on health care policy in Washington. Americans consistently express concern that their own insurance is becoming LESS affordable, or they’ve been dropped from coverage, or they believe one of those two things will happen to them. In addition, the administration’s own estimate is that millions fewer than the 13 million necessary to make the system solvent will be signed up by the end of 2015. What is a good strategy for getting better health care for more Americans?
TT: Despite GOP unhappiness with the ACA, the GOP currently lacks the capacity to repeal the law. The filibuster in the Senate, combined with President Obama’s veto pen, mean that Democrats have the mechanisms for blocking a repeal effort. Nevertheless, expect both the House and Senate to vote on repeal and try to advance it to the president’s desk.
Following this effort, the GOP will then look at the most unpopular parts of ACA. At the top of their list will be the medical device tax, which a number of Democrats oppose, and which incoming Majority Leader Mitch McConnell noted was “deeply, deeply unpopular with the American people.” Given that Democratic Senators like Amy Klobuchar and Al Franken also oppose this tax on innovation, a device tax repeal does have a chance to make it out of the Senate and onto President Obama’s desk.
Another issue is the definition of the work week. The ACA’s definition of 30 hours as full time employment provides incentives to employers to reduce the number of hours worked so as to avoid the ACA’s employer mandate, the requirement that employers provide health insurance or pay a penalty. Raising the limit to 40 hours a week would end this incentive to reduce the numbers of hours worked. This issue also is likely to garner bipartisan support.
A third issue could be the excise tax, which both business and labor have concerns with and will be hitting an increasing number of plans over time, with implications for lower wage workers. The threshold for paying this tax, designed to hit high value, “Cadillac” style health plans, grows according to the Consumer Price Index and not according to medical inflation. As a result, an increasing number of plans will trigger the excise tax over the next two decades; in 2031, the average family health care plan is expected to hit the excise tax threshold. The impact that the excise tax will have on lower income workers, as well as opposition to the tax from both labor and business, could help generate bipartisan support for getting an excise tax repeal through Congress.
A fourth issue, which is not included in the ACA, is tort reform. A Congressional Budget Office analysis found that reining in out of control medical lawsuits could save over $50 billion over ten years. Tort reform passed the House a number of times during the George W. Bush administration, but could not make it through the Senate. The GOP Congress might want to take a look at this issue as well.
Even if the GOP cannot repeal the ACA in the upcoming Congress, they will want to show the American people that giving them control of the Senate did bring about appreciable benefits to the American people, so expect these key health care issues to be on the GOP’s agenda in the new Congress.