Trumpcare: A new reality for U.S. healthcare

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September 20, 2016
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April 27, 2017

A new reality for U.S. healthcare

Now that Donald Trump will soon be sworn into office as our next president, in the weeks and months ahead we can expect to learn more details about his proposed healthcare policies and how he plans to begin the process of repealing the Affordable Care Act.

While most Americans are likely more familiar with his reality TV show than his proposed healthcare policies, and while his proposed policies are not as detailed as those that were listed on the Hillary Clinton campaign website, there’s more substance to Trumpcare than what was reflected in many of his short statements and one-liners in the debates. The policies that make up Trumpcare will require substantial changes to U.S. healthcare’s current legal and regulatory structure, and to U.S. tax law.

Repeal of the ACA

The first priority for Trump will be the repeal of the ACA. However, this is not expected to happen overnight. The overhaul of the ACA, or the transition from the ACA to Trumpcare, however it is done, will clearly not be as simple as a reality TV show where Trump sits at a conference table, looks through each ACA rule and says “you’re fired.” Economists and lawmakers that have been deeply involved in U.S. healthcare policy have noted that repealing the ACA will be an extremely difficult task.

Repeal not as easy as it seems

Why will this be so difficult? First of all, approximately 20 million people have gained insurance over the last three years through the ACA, and many people on both sides of the political spectrum like certain ACA provisions about pre-existing conditions, preventive care and age 26 dependent coverage. Even Trump himself has said that he likes the rule about pre-existing conditions.

Further, the individual mandate, the employer mandate, and taxes on insurers and plans, are what makes the coverage affordable, and what pays for the ACA’s benefits. Without this core structure, it’s unclear how the ACA would be funded.

Additionally, another problem with repeal is that — with the exception of a proposal in June by House Speaker Paul Ryan, which mainly replaces certain components of the ACA with other Republican policies — Republicans have not explained precisely how they would “replace” the ACA. In other words, while some parts of the ACA may be able to be removed more easily than others, a wholesale “replacement plan” has not yet been proposed by any Republican, and such a plan may leave millions without coverage.

Further, other political challenges will likely arise to a replacement plan, including questions of whether all of the Republicans will agree to the plan, and whether Democrats will filibuster any legislation that makes its way to the Senate.

Even if Trump is able to eventually repeal the entire ACA, he will still need to come up with a solution in the short-term for the problems that are now occurring with the ACA’s exchanges. In late October, the exchanges took on significant criticism from both sides of the political spectrum due to the 22% increase in average premium cost between 2016 and 2017. Additionally, 2016 saw large insurers exiting the exchanges.