The number one priority of Republican leaders in the House, the Senate and the White House, repeal of the Affordable Care Act (ACA) remains at the very top of the political agenda. On Capitol Hill, Republicans have elected to continue their strategy of repealing and replacing the ACA through the expedited legislative process known as "budget reconciliation." In early 2016, House and Senate Republicans adopted an ACA repeal through this process, but the legislation was later vetoed by President Obama. Congressional leaders had originally intended to build on last year's success through "repeal and delay" in which Republicans would repeal the ACA through budget reconciliation (which would not require Democratic support) and then delay the replacement for a period of time (possibly two to four years), giving them time to work with Democrats to devise a replacement measure. However, since the budget resolution's passage in January 2017, the plan has lost momentum as a number of moderate Senate Republicans have expressed reservations for repeal and delay, instead pushing for a simultaneous repeal and replace. Under Senate rules, any replacement plan is likely to be subject to a Democratic filibuster, meaning it would need at least eight Democratic Senators to break ranks and join all 52 Senate Republicans to ensure passage. House Republican leadership has announced it will release ACA replacement legislation after Congress returns from the Presidents' Day recess on February 28, and President Trump indicated he will release a plan in early to mid-March.
On a parallel track, the Trump Administration has already begun to move forward to do all it can to lessen the impacts of the ACA. On President Trump's first day in office, he issued an executive order directing U.S. government agencies to "grant relief" to all constituencies affected by the ACA, including consumers, insurers, hospitals, doctors, companies, states and others. The order also instructs agencies to "waive, defer, grant exemptions from or delay" ACA rules and to work to create a system to allow sale of health insurance across state lines. Analysts are unclear as to what the end result of the order will be, but it demonstrates the commitment of the Trump Administration to do all it can under the law as currently written to roll back the effects of the ACA.
On February 15, the Department of Health and Human Services made its first move to stabilize the individual health insurance market, issuing a proposed rule to address some of the policies that many believe have contributed to an unbalanced risk pool, resulting in rising premiums and the departure of insurers from the marketplace. The proposed rule includes changes to the guaranteed availability of coverage, the open enrollment period, special enrollment periods, the continuous coverage requirement, levels of coverage, network adequacy and essential community providers regulations. For more information, please click here to see our analysis of the proposed regulations. Stakeholders have until March 7, 2017, to comment on the proposal.
Expect President Trump and Secretary of Health and Human Services Tom Price to undertake a number of additional actions to limit the impact of the ACA, including, among others:
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Halting defense against lawsuits challenging the ACA, such as those challenging cost sharing for low-income enrollees and risk corridor payments;
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Revising guidance to loosen criteria for the individual mandate's hardship exemption and the contraception coverage mandate;
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Implementing administrative fixes and adding additional flexibility for state administered programs such as Medicaid; and
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Undertaking rulemaking efforts to change the essential health benefits.
Takeaway: Throughout the coming year, congressional Republicans will continue to push to repeal and replace the ACA, and the Trump Administration will seek to limit its impact and roll back as many regulations, executive orders and administrative guidance as possible under existing law. It is not yet clear whether and in what way the ACA will be replaced as Republicans have not yet coalesced around support for a particular timeline, strategy or legislation. A number of proposals have been floated, including Speaker Ryan's Better Way, Secretary of Health and Human Services Tom Price's Empowering Patients First, Senators Cassidy (R-LA) and Collins' (R-ME) Patient Freedom Act and an expected Trump Administration plan, among others.
