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The sticking points keeping the GOP health care bill in limbo

July 17, 2017 at 6:40 PM EDT
The vote on the Senate Republican health care bill has been delayed, but the behind-the-scenes battle continues. What key questions could help decide the bill’s fate? Dr. Ezekiel Emanuel of the University of Pennsylvania and Avik Roy of the Foundation for Research on Equal Opportunity join Judy Woodruff to debate different aspects of the proposed legislation.
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JUDY WOODRUFF: Even as Senate Majority Leader Mitch McConnell has moved to delay a vote on a Republican health care plan, there’s no letup in the battle behind the scenes.

Lawmakers, governors, interest groups are all working furiously. A handful of key questions may decide the bill’s fate. Among them, how many fewer people would be covered? And will cheaper insurance make it more appealing or would it be too skimpy for too many?

Dr. Ezekiel Emanuel is one of the original architects behind Obamacare. He’s the author of the new book “Prescription for the Future.” And Avik Roy is co-founder and president of the Foundation for Research on Equal Opportunity. It’s a think tank based in Austin, Texas. He’s been a health adviser to Republican presidential candidates, including Mitt Romney.

And we welcome both of you to the program.

Avik Roy, let me start with you.

We don’t have an analysis of this Senate bill, this new Senate bill by the Congressional Budget Office, but there was an analysis done by the health care firm Avalere. It is forecasting that this bill would lead to federal Medicaid funding reductions ranging from 29 to 37 percent in all 50 states.

Doesn’t that make it understandable why even Republicans are still struggling to support this bill?

AVIK ROY, The Foundation for Research on Equal Opportunity: Well, Judy, there’s a bit of misunderstanding as to exactly what the source of those changes to Medicaid are.

There are really two major components. There is the first, which is the repeal of Obamacare’s expansion of the Medicaid program, which is replaced by a robust system of tax credits for those individuals, those enrollees to buy private coverage.

So that’s about 85 to 95 percent of the money that you’re describing. Then there’s a small component, which is per capita reforms, a Bill Clinton proposal from 1994, to make the long-term Medicaid program more fiscally sustainable.

And that’s the piece that really matters to those governors, particularly in states that didn’t expand Medicaid, because that’s going to be a pretty gradual, but important reform to make the Medicaid program fiscally sustainable.

So the first piece, the big piece, replaced by tax credits to afford coverage for those individuals, and the second piece for the legacy program a very gradual and sensible and bipartisan approach to Medicaid reform.

JUDY WOODRUFF: So, just so that I understand, you’re saying that these cuts are not as draconian as they sound?

AVIK ROY: Exactly.

JUDY WOODRUFF: All right.

Dr. Zeke Emanuel?

DR. EZEKIEL EMANUEL, University of Pennsylvania: I don’t know, when you cut $170 billion out of a program over 10 years, and when the CBO says 15 million people are going to lose Medicaid program.

And let’s remember those who 15 million people are. They’re the working poor. They’re able-bodied people who are generally working — two-thirds to three-quarters of them work at jobs. It’s just their employers don’t provide insurance.

Avik says, well, we’re going to give them a subsidy. Remember, the subsidies are less than the subsidies that the Obamacare proposal gives, and they go to a much, much smaller level. The insurance they cover is much less. It is not comparable.

You can’t cut $770 billion and say, oh, it’s not going to affect anything; 22 million people are going to lose coverage because of this bill.

JUDY WOODRUFF: Avik Roy, how do you answer that?

AVIK ROY: Yes, so the CBO estimate, this 22 million number that Zeke is talking about is largely driven by erroneous aspects of the Congressional Budget Office’s methodology.

The CBO believes that 15 million people will drop out of the insurance market in 2018 because they will no longer face a fine for not purchasing coverage, the individual mandate that we all hear so much about.

And, ultimately, about 18 million of that 22 million is driven by the lack of a fine forcing people to have coverage, so it’s not driven by a lack of funding. There’s robust funding.

(CROSSTALK)

DR. EZEKIEL EMANUEL: If you don’t like the message, attack the messenger.

(CROSSTALK)

AVIK ROY: No, but this is a fundamental problem with the CBO’s methodology.

And it’s the reason why Obamacare has an individual mandate in the first place. Senator Obama in 2008, he opposed having an individual mandate in his bill.

And it was only included because the CBO told him that 16 million — the coverage, the statistic of coverage would be affected by that.

JUDY WOODRUFF: All right, I don’t want to spend the whole time on the CBO, the Congressional Budget Office, but just a quick response to that.

DR. EZEKIEL EMANUEL: Well, again, I think he’s attacking the messenger because he doesn’t like the message.

And the fact is that the CBO is the independent arbiter. Their methods aren’t universal. They don’t get it necessarily exactly right. But you’re not going to go from 22 million uninsured down to a more tolerable number.

It seems unconscionable that senators could vote to throw 22 million people off of insurance. And now we have the irony that John McCain is delaying the vote, a guy who needed surgery that cost $30,000. He certainly couldn’t afford it just out of nowhere. Insurance has to pay. And we’re going to get 22 million people with less insurance.

JUDY WOODRUFF: Another aspect of this, Avik Roy, is this — in an effort to make insurance more affordable, what we now see is a Senate bill offering alternatives that lower premiums, but they do this by cutting back on the amount of coverage, on what is covered.

You’re creating — the criticism here is that you’re creating two markets, one for people who can afford to continue to get good medical care and those who would be left out because they can’t. How do you defend this part of the legislation?

AVIK ROY: Well, Judy, I would use — I would challenge the accuracy of the description that you just gave of the measure. I think we’re talking about the Ted Cruz amendment to the Senate health care bill.

And what that amendment is trying to do is say, OK, sick people are going to have much more expensive coverage because they consume more health care. So, let’s have direct taxpayer subsidies in this regulated market to ensure that they can find affordable coverage.

But the fact, Judy, is that tens of millions of Americans who can’t afford coverage can’t afford that coverage not because they’re sick, but because they’re healthy and insurance costs too much.

And Obamacare over the last four years has doubled or tripled their premiums. HHS, Health and Human Services, researchers have estimated that premiums have increased for that population by at least 100 percent over the last four years.

So, what Ted Cruz is trying to do is say let’s make sure there’s coverage that is affordable for healthy people, as well as for sick people. And you do that by having a market that really is focused on covering people who are already sick, which requires a different kind of insurance, and people who are healthy and who need lower premiums as a result.

DR. EZEKIEL EMANUEL: Let’s make three quick points.

First of all, the subsidies that the Republicans are going to give are going to be much less and smaller, driving up what people have to pay, and especially their deductible. They don’t do anything about affordability in this bill at all. They don’t change the long-term trajectory of health care costs one bit.

Second of all, the fact is that every medical organization has come out against this bill and says it’s going to be bad for patients. And the health insurance industry says that what Avik Roy just said is basically false.

You will segment the market. You’re going to take healthy people, you’re going to separate them. You’re going to put the sick people in a market, and then you’re going to reduce the subsidies you give them to buy insurance, because the insurance is pegged at a much skimpier package.

That is not a recipe for having people have good insurance and decreasing deductibles. It’s actually going to do the exact reverse of what the president pledged.

JUDY WOODRUFF: Do you want to respond?

AVIK ROY: Absolutely.

So, I would challenge a number of things that Zeke said there, as you would expect. The first is that the chief actuary of the Centers for Medicare and Medicaid Services, who is an Obama appointee, published a report a couple of weeks ago where he said, in fact, that this bill would bend down the cost curve and reduce overall national health expenditures by making the health care system more responsive and more efficient.

And, actually, the tax credits in the Senate health care bill would expand to ensure that those individuals who are sick, who need robust coverage would be able to afford the premiums they have.

So, this bill will actually provide hundreds of billions, if not trillions of dollars over the long term to ensure that those people can afford coverage.

DR. EZEKIEL EMANUEL: It’s funny. You’re talking about giving more money, when, in fact, the bill is cutting back the money it’s putting into the health care system. You can’t have it both ways.

JUDY WOODRUFF: One final to you, Dr. Zeke Emanuel.

Many parts of the countries, we know there are going to be many counties where, under the ACA, the Affordable Care Act, there’s only one insurer left. Prices have gone up. A lot of people have been priced out of the market.

DR. EZEKIEL EMANUEL: Absolutely.

JUDY WOODRUFF: And this is completely aside from what the Republicans are trying to do.

DR. EZEKIEL EMANUEL: Well, it’s not — no, I would disagree with there, Judy, because the uncertainty they have created in the market, the Republicans — Marco Rubio removed the risk corridors and the re-insurance proposal.

They have also created uncertainty about whether they are going to pay the cost-sharing subsidies. Those are subsidies to families making less than $70,000 to pay their deductibles. That actually drives premiums up.

There are simple solutions. You put the risk corridors in. You give — you guarantee you are going to pay the cost-sharing subsidies. And you give insurance companies a tax break. You refund them the tax from the Affordable Care Act if they go into counties that have one or fewer insurances.

That will actually stabilize the insurance markets. And states that run their insurance exchanges, like California and Idaho, they actually are running pretty well. It’s the federal side that’s not running so well. And the federal side is run by Mr. Trump’s associates.

JUDY WOODRUFF: All right, we’re going to have to leave it there, big subject, much to talk about. We are going to continue to come back to it.

Zeke Emanuel, Avik Roy, we thank you both.

DR. EZEKIEL EMANUEL: Thank you for having us.

AVIK ROY: Thanks, Judy.

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