The Trump administration assumed office with grand pledges to repeal and replace Obamacare with sweeping legislation. Running for reelection, Trump has spoken much less about health-care reform, and his speech dedicated to the issue will surely be quickly forgotten. Yet, his campaign address was characteristic of his administration’s health-care policy: a poorly coordinated mix of worthy reforms and ill-directed hype, which distracts from actual achievements.
In 2016, Trump made use of public dissatisfaction with the Affordable Care Act to win the presidency. The individual market for health insurance was in chaos as a result of the legislation, which caused premiums to soar, deductibles to rise, and insurers to flee the market. As a candidate, Trump proposed “something terrific” to replace Obamacare, but offered no clear plan—occasionally even expressing support for single-payer health care.
Much of the first year of Trump’s presidency became dominated by attempts to repeal the ACA and, lacking a fleshed-out draft of his own, the president largely stepped back to let Congress run the show. This proved a mistake. The House of Representatives designed its initial American Health Care Act proposal with an eye to generating budgetary savings to pay for tax reform, and produced a bill that the president himself damned as “mean” after its release. Senate Republican leaders, who had also raised expectations of sweeping reforms to Medicaid and insurance markets, similarly failed to deliver, as their two-seat majority was inadequate to surmount resistance to Medicaid cuts or to overcome a filibuster to insurance-market reforms.
The inability of Republicans to “repeal and replace” the ACA on a party-line vote was predictable. But little effort was made to put together a plan that would have pressured moderate Democrats to support it. Like many other Republicans, Trump tended to see health-care policy as a means to ends on other issues, or as a political minefield to get out of as quickly and safely as possible.
And yet, the Trump administration has achieved genuine accomplishments in health-care policy. While, like other Republicans, the administration put itself out on a limb by overhyping ACA “repeal and replace,” it has underhyped its most consequential health-care reform—which the president referred to in his speech only in passing and obscurely as “a massive expansion of health reimbursement arrangements.”
One of the most fundamental problems of American health care over the past 75 years has been that the tax exemption for employer-sponsored health insurance puts employers, and not individuals, in control of the purchase of health-care plans. Through a regulatory reform making use of provisions of the ACA, the administration has allowed employers to give staff pre-tax dollars to purchase their own insurance coverage—giving control to 158 million Americans who get health care from their jobs.
This reform lets Americans get more cost-effective coverage for themselves, makes it easier for them to keep plans as they move across jobs, and, by doing so, eliminates the main source of the risk of coverage denials due to preexisting conditions. This is a fundamental reform that Republicans have sought for decades, but it would be surprising if 5 percent of the American people were even aware that it has happened.
As part of the tax-reform legislation, Trump also signed into law the elimination of the individual mandate penalty. This removed an inequitable and ineffective penalty that was the least popular element of the ACA, and allowed the administration to make available more affordable coverage alternatives by expanding a loophole for “short-term limited duration insurance” that the ACA had exempted from its insurance-market reforms. Due to its support for a technical fix known as “silver-loading,” the administration has also succeeded in stabilizing the ACA’s individual market. Premiums that had soared over the ACA’s first four years have started to decline, and insurers that had fled the individual market are now starting to return.
In his campaign speech, Trump deemed President Obama’s notorious pledge (“If you like your plan, you can keep your plan. If you like your doctor, you can keep your doctor”) to be “the greatest health-care lie ever told.” Yet, the Trump administration’s support of Texas’s constitutional challenge to the ACA, which has little chance of succeeding, has invited the same charge—by threatening to eliminate the plans that many Americans now rely upon. This has totally undermined the administration’s ability to claim credit for fixing the individual market with its efforts to support ACA plans through silver-loading and to expand enrollment in them through the HRA rule.
The Trump administration has also failed to solve the problem of doctors and hospitals sending surprise bills to patients, following treatment, without any prior consent to price—even if they have insurance coverage. Trump has deferred to Congress on the issue, though it was congressional Democratic leaders who blocked agreement on the issue at the last minute. A significant policy accomplishment, which also would have been a political win, was thereby lost.
Trump has instead directed his public fire at the drug industry, though drug prices are the slowest-growing element of health-care costs. As a result, his administration has struggled to find significant savings in this area, despite the expense of enormous political capital and bureaucratic effort. The absence of legislation for sweeping price controls, and the likelihood that executive orders will be challenged in court, has left the administration to fall back on a mix of gimmicks and modest reforms, and without a clear, salable accomplishment.
Where its officials have agreed, the Trump administration has been able to generate good and worthwhile health-policy reforms. But where this hasn’t been the case, bureaucratic infighting and the absence of detailed direction from campaign pledges or presidential action has yielded unclear and contradictory policies.
There is a consistent philosophy underlying many of the Trump administration’s health-policy reforms: the belief that individuals should be placed in control of purchasing insurance; that insurers should have more freedom to offer plans at lower costs; and that some elements of the ACA have value and should be retained as a safety net. Yet, the habitual temptation to bash whatever was associated with Obamacare has impeded the administration from consistently upholding these principles and has prevented it from claiming credit that it might have deserved.
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