Donald Trump and Health Care and What He Can Do If He is Back in the White House: Goodbye Affordable Care Act

American Eclectic posts articles twice a month, on the 1st and 15th. This is the second year of publication; previously published articles can be found on my site.

January 15, 2024

In April 2011, a court case before the Eleventh Circuit Court of Appeals ruled that parts of the Affordable Care Act (ACA) often known as Obamacare, were unconstitutional. The requirement that people buy health insurance or face penalties imposed by the IRS was declared as unconstitutional.  This was the first case at an appellate court level to find something in the ACA as unconstitutional, so it received a great deal of attention.  The opinion in this case read:

[W]hat Congress cannot do under the Commerce Clause is mandate that individuals enter into contracts with private insurance companies for the purchase of an expensive product from the time they are born until the time they die.

The 304-page opinion said a lot more than just a reference to the Commerce Clause in the Constitution, but that received little, if any, attention.  One issue raised in this opinion was cost-shifting.  As the opinion stated:

[T]he primary persons regulated by the individual mandate are not cost-shifters but healthy individuals [their italics] who forego purchasing insurance.  The [ACA] confirms as much.  To help private insurers, the congressional findings acknowledge that the individual mandate seeks to ‘broaden the health insurance risk pool to include healthy individuals,” to “minimize adverse selection,” to increase “the size of purchasing pools,” and to promote “economies of scale.”  The individual mandate forces healthy and voluntarily uninsured individuals to purchase insurance from private insurers and pay premiums now in order to subsidize the private insurers’ costs in covering more unhealthy individuals under the [ACA’s] reforms.

Elsewhere this opinion referred to findings from Congress and the opinion reflected an understanding that while the Commerce Clause was the focus of this particular case, health care required a national solution:

[W]hen the unsured do seek medical care, they often fail to pay all or even most of their costs.  On average—and these figures are not disputed—the uninsured pay only 37% of their health care costs out of pocket, while third parties pay another 26% on their behalf.  The remaining costs are uncompensated—they are borne by health care providers and are passed on in the form of increased premiums to individuals who already participate in the insurance market.

The cost of providing uncompensated care to the uninsured was $43,000,000,000 [$43 billion] in 2008.  To pay for this cost, health care providers pass on the cost to private insurers.  This cost-shifting increases family premiums by an average over $1,000 a year.  By significantly reducing the number of uninsured, the [individual mandate], together with other provisions of [the ACA], will lower health insurance premiums.

As a union president at a university during the 1980s, I was aware of this issue.  Keeping insurance premiums down was a developing issue in the 1980s as insurance premiums rose dramatically. Many businesses covered all of an employee’s health care costs, and as premiums rose, they began to impact salaries—in my case faculty salary. Somewhere as the 1980s unfolded, employees were asked to contribute to their health care plans. Interesting how people get all excited if they are told that a tax increase is coming, but how is that different from suddenly having to contribute to your health care premiums. Those out-of-pocket health care premiums reduce your disposable income, no different than a tax increase. Most people only see their salaries as a labor cost, not considering other employee costs covered by employers (health insurance even if partially employer covered, retirement contributions, employer Social Security payments).  I was always on the search for a new health care plan to replace whichever one we had as a way of keeping health care premiums down to have more money available to go toward faculty salaries.

Television news does a terrible job of addressing health care cost issues, there are too many complicated parts to health care costs for any segment on an evening news show to do more than be incredibly superficial.  As a result, few Americans can appreciate all the moving parts so the simplicity of putting health care in a meaningless liberal versus conservative argumentative framework is what we are stuck with.

Donald Trump wants to be back in the White House.  One of my fears is that he wants another crack at going after the Affordable Care Act and has nothing of substance to replace it with.  Trump liked using words like “phenomenal,” and “fantastic,” regarding what he was going to propose to replace the ACA, but he never delivered—it was all talk.  When he was on the campaign trail leading up to the 2016 election he would talk of “something terrific,” regarding his health care plan.  In February 2016 he tweeted, “We will immediately repeal and replace Obamacare-and nobody can do that like me.  We will save $’s and have much better health care!”  One article placed the number of tweets where he attacked the Affordable Care Act at 435—that was only up to May 1, 2017, four months into his Presidency. He had nothing and will continue to demonstrate he has nothing of substance to add. I do not expect any TV news show to be able to pin him down and address anything specific about a Trump healthcare plan: He has none and never will.

Between 2014 and 2015, the percentage of Americans without health insurance fell from 18 percent to 11.4 percent, but then between 2016 and 2018, two years into the Trump Presidency, the percentage that were uninsured increased from 10.9 percent to 13.7 percent.  One commentator used the word “sabotaged” as the best way to describe Trump’s approach to solving the health care issue.  In 2022, the uninsured rate fell to 8 percent, the lowest it has ever been.  Can we assume that Trump would do what he can to increase the number of uninsured Americans while saying he was going to (eventually) offer a better plan.

Referring to the quotes above from the Court of Appeals case about cost-shifting and the uninsured not paying their full share of their health care costs, raises the issue of who pays: There is no free lunch.  In the mid-1990s, I had an interview with the CEO of a hospital in the suburbs of St. Louis.  We discussed the fact that the hospital was not being fully compensated through the Disproportionate Share Hospital (DSH) program within Medicaid.  The DSH exists to reimburse hospitals for care where they are left to essentially “pick up the tab.”  His proposal to find compensation was to ask the city council to have a property tax increase and that increase would go to the hospital.  The city council did not take him up on his proposal, so cost-shifting meant adding expenses to the bills of those with health insurance.  I went over this issue with a retired CEO of a national health insurance company, and he verified this was the case.

I remember talk radio, those various conservative radio shows that I periodically tuned into in the St. Louis area, when the Affordable Care Act was in its early years and how they bashed the ACA and pushed listeners to not sign up.  So, essentially, they wanted a higher uninsured rate and had no clue this was a classic example of cutting off your nose to spite your face.  Go ahead, tell people not to carry health insurance and forget to tell your other listeners with insurance they were going to have the privilege of paying for the right of those not wanting to carry insurance.  Simple liberal versus conservative fits well when it is addressed in abstract ways or with antidotal stories, this is too complicated and messy for a few moments of liberal versus conservative nothingness that passes as news on Fox News.

The Disproportionate Share Hospital program within Medicaid is important to understand.  Medicaid, on average, is about 18 percent of a state government’s general funds (ranging from a low of 8 percent to a high of 42 percent among the states).  The federal government through a complicated formula called the federal medical assistance percentage (FMAP) covers between 50-73 per cent of overall Medicaid costs.  About 23 percent of the American population is covered by Medicaid and around 18 percent of overall health care spending in this country are Medicaid dollars. Medicaid costs and state budgets are always a concern to state legislators. Any increase in state government spending for Medicaid means other categories (education, roads, economic development) will need to be cut or there will be a need to push for tax increases. 

If Trump were back in the White House and pushed for new ways to make it more difficult to gain access to health care and the uninsured rate went up, then would hospitals be performing medical services on people where they would want more from the DSH program, which would mean that pressure would be placed on Medicaid increasing as a percentage of a state’s budget.  Of course, all those conservatives on talk radio telling people to not sign up for insurance who also oppose “big government spending” probably would not be talking about the pressure placed on state governments to push for more in federal funds to cover DSH spending in Medicaid. Being a radio talker and never have to face making the difficult choice of cutting state education spending or proposing a new state tax increase is left to others.

The federal government declared the national pandemic emergency at an end (although people still are getting Covid, and people are still dying from it).  May 11 of this past year was the date the emergency officially ended, which means that states started to kick people off Medicaid.  Without the emergency, new guidelines are in place and in Arkansas, for example, Governor Sarah Huckabee had the distinction of being the first state to complete a post-pandemic eligibility review, which led to more than 427,000 in her state removed from Medicaid—that within five months of the declared end of the pandemic. I have to wonder whether hospitals in Arkansas will turn to DSH funding to compensate them for unreimbursed care or pass the costs along to those with healthcare insurance. Within two weeks after the official date that the pandemic ended, a New York Times article stated:

Hundreds of thousands of low-income Americans have lost Medicaid coverage in recent weeks as part of a sprawling unwinding of a pandemic-era policy that prohibited states from removing people from the program.

The Congressional Budget Office (CBO) estimates 15.5 million nationally will lose Medicaid coverage, although they see 6.2 million of that number being uninsured.  I need to write an article on the term “uninsured” it is not as precisely understood as many assume: There is uninsured, as meaning between jobs and waiting for healthcare benefits to kick in with a new job and there is uninsured as going a year or more without insurance.  The Kaiser Family Foundation places the number who will lose Medicaid coverage under the new guidelines as 24 million or more, higher than the CBO figures.  Numbers in the millions are always tricky to accurately determine. Another article I need to write about: A lack of precision in government numbers, particularly when talking in terms of millions of people is understandable. Because of the pandemic declared as at an end, that current 8 percent uninsured rate may suddenly go up and Trump, if back in the White House, would have the opportunity to help drive it up farther. 2023, by the way, was a good year for the ACA, more than 15 million signed up for the program, that was a 33 percent increase from the previous year.

Here is a pocketbook issue: How much more do you want to put out for healthcare insurance premiums for you and your family? Since premiums could go up as the number of uninsured goes up, how much less will you have to put aside toward retirement or save for your children to go to college.   The problem with looking at every public policy issue from only a liberal versus conservative perspective and assuming ideology can provide solutions to issues that do not easily fit within the talking points of that type of mentality, makes it difficult to understand that on some issues, we are all in the same boat. The Donald, unfortunately, is in his own boat.

Notes

Roger Collier, “Why Trumpcare failed,” CMAJ (May 1, 2017): https:// www.ncbi.nlm.nih.gov/pmc/articles/PMC5415398/

Michael Cooper, “Health Law Is Dealt Blow by a Court on Mandate,” New York Times (August 12, 2011): https:// www.nytimes.com/2011/08/13/us/13health.html.  The full text of the 11^th Circuit Court of Appeals case can be found hyperlinked in this article.

Michael Hiltzik, “Column: Millions of Americans are about to lose their healthcare coverage.  Many have no idea,” Los Angeles Times (July 27, 2023): https:// www.aol.com/news/column-millions-americans-lose-healthcare-120053483.html

Sarah Kliff, “Under Trump, the number of uninsured Americans has gone up b 7 million,” Vox (January 23, 2019): http:// www.vox.com/platform/amp/2019/1/23/18194228/trump-uninsured-rate-obamacare-medicaid

Victoria Knight, “Back to the future: Trump’s history of promising a health care plan that never comes,” Fierce Healthcare (August 14, 2020): https:// www.fiercehealthcare.com/payer/back-to-future-trump-s-history-promising-a-health-plan-never-comes

David A. Lieb and Andrew DeMillo, “Arkansas purges 427K from Medicaid after post-pandemic roll review; Advocates worry about oversights,” AP (October 10, 2023): https://apnews.com/article/medicaid-eligibility-arkansas-pandemic-7f3e59825092a6f51f4a1fb2975b1f87

Medicaid’s Federal Medical Assistance Percentage, Congressional Research Service (Updated Jul 29, 2020): https://crsreports.congress.gov/product/pdf/r/r43847

Medicaid Expenditures as a Percent of Total State Expenditures by Fund, KFF (Timeframe: SFY 2021): https://www.kff.org/medicaid/state-indicator/medicaid-expenditures-as-a-percent-of-total-state-expenditures-by-fund/?currentTimeframe=0&sortModel=%7B"colId":"Location","sort":"asc"%7D

“New HHS Report Shows National Uninsured Rate Reached All-Time Low in 2022,” HHS Press Office (August 2, 2022): https:// www.hhs.gov/about/news/2022/08/02/new-hhs-report-shows-national-uninsured-rate-reached-all-time-low-in-2022.html

Frank Thompson, “Six Ways trump has sabotaged the Affordable Care Act,” Brookings (October 9, 2020): https:// www.brookings.edu/articles/six-ways-trump-has-sabotaged-the-affordable-care-act/

Donald J. Trump tweet: https:// twitter.com/realDonaldTrump/status/697182075045179392?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E697182075045179392%7Ctwgr%5E&ref_url=https%3A%2F%2Fabcnews.go.com%2FPolitics%2Ffact-checking-trumps-repeal-replace-obamacare-timeline%2Fstory%3Fid%3D46360908

Noah Weiland, “Hundreds of Thousands Have Lost Medicaid Coverage Since Pandemic Protections Expired,” New York Times (May 26, 2023): https://www.nytimes.com/2023/05/26/us/politics/medicaid-coverage-pandemic-loss.html

Noah Weiland, “Americans Are Signing up for Obamacare in Record Numbers,” New York Times (December 21, 2023): https://www.nytimes.com/2023/12/21/health/aca-obamacare-enrollment.html