Up Front

Web Chat: Repealing Health Care Reform

Henry J. Aaron

On January 19, Brookings expert Henry Aaron answered your questions about the efforts on Capitol Hill to repeal the health care reform bill and other strategies to roll back or change its provisions in a live web chat moderated by Seung Min Kim of POLITICO.

12:29 Seung Min Kim: Hello everyone and happy Wednesday! We’re here today with Henry Aaron of the Brookings Institution. He’s here to answer your questions about the repeal of the health care law, a vote on which is scheduled for this afternoon in the House. Welcome, Henry.

12:29 [Comment From Lorne: ] Aren’t we really stuck with the affordable health care act until we get a new president? Obama holds the veto pen and there’s not enough votes to override it.

12:31 Henry Aaron: Stuck with? Or blessed by? In either case, complete repeal before January 21, 2013 seems out of the question, first because the Senate is unlikely to approve it and secondly because President Obama would veto it. But there is likely to be a huge amount of action in Congress over the next two years.

12:32 [Comment from Sue Darcey] Do you believe that if the Republicans eventually decide to target specific sections of the Affordable Care Act for repeal, that they will go after the provisions in the law providing free preventive screenings and services to Medicare recipients, or those who receive government-subsidized health care insurance?

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12:34 Henry Aaron: To the question on what the Republicans will target…the immediate target is the whole bill. Were they to succeed, which seems unlikely in the next two years, everything would go. They have said that they like parts of the bill. But reenacting anything would be going to be extremely difficult in the atmosphere that would exist after repeal. Added services for Medicare beneficiaries would be one of the provisions they would likely endorse. The subsidies would probably disappear, or at least be completely transformed, under any Republican legislation.

12:34 [Comment From John Booke: ] Does the Affordable Care Act “sustain the SGR system as a method for slowing the growth of health care spending?” How important is the SGR system for slowing health care spending compared to other similar methods? Why has congress blocked the implementation of the SGR system every year for the past five years?

12:35 Henry Aaron: The ACA said nothing about SGR. That was enacted separately and the fix was in a different bill. The SGR system has, so far, not been very important, largely because it was so poorly drafted that Congress has been unwilling, and likely will remain unwilling, to enforce it. It isn’t flat out repealed because doing so would force the explicit recognition of a large increase in the deficit.

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12:35 [Comment From Dave: ] Will Republicans have the votes to repeal?

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12:36 Henry Aaron: In the House, yes. In the Senate, no.

12:36 [Comment From Leann: ] What if Republicans refuse to fund the health care reform law? Isn’t that a form of “repeal?”

12:39 Henry Aaron:
Refusing to fund has three meanings in the current context. As far as the substance of the subsidies and insurance exchanges, defining is not an option; it is in the bill. But there are dozens of other provisions doing a wide range of things for which the bill enacted ‘authorizations’ but not ‘appropriations.’ Congress can withhold appropriations, in which case, those provisions would be dead letters. The most portentous immediate funding issues concern money for implementation planning and implementation. On that issue, there are likely to be fierce battles that could lead to deadlock and even to shutdowns of part of the government. Without this funding, the administration will be unable or seriously delayed in rolling out various provisions of the bill set to take effect on January 1, 2014.

12:40 [Comment From Rick: ] Is this mostly a symbolic move? Since I doubt the viability of repeal, it seems like the Republicans are just trying to undermine the President, which is pretty un-American if you ask me.

12:41 Henry Aaron:
Symbolic, in a sense. Repeal now is highly improbable. But the repeal effort is part of a long-term campaign that will bulk large in the 2012 elections for the presidency and for both houses of Congress. The battle over repeal of individual provisions of the bill will follow the general repeal effort. And then will come the fight over appropriations for implementation.

12:42 [Comment From John: ]
In our last web chat you mused that congressional efforts for impact ACA were balanced between appropriators and the veto pen leaving the question as one of who will blink first? Given the events since then, what do you think we will see now. Are there specific elements at risk?

12:42 [Comment From Cynthia Williams: ]
Will health-care research funding in the law be greatly reduced? Will ACA research projects that have already started be required to stop due to a lack funding for their outlying years?

12:42 Henry Aaron: I have seen no reason to change my mind. Alas!

12:43 Henry Aaron: On research funding…that is one of the provisions for which Congress authorized appropriations, but did not appropriate the funds. There is a large budget deficit. People are getting increasingly worried about the deficit. That means that all appropriations are now in some jeopardy.

12:43 [Comment From Guest: ] Do you think the public is suffering in any way from fatigue over the health care debate? And might that be a problem for Republicans as they continue to keep the reform debate alive in the next two years?

12:45 Henry Aaron: I think health care is important to most of us and that tends to offset the fatigue that might otherwise settle in. The real challenge–for both Republicans and Democrats–is not fatigue, but rather the need to make their cases honestly and persuasively. It is said that truth is the first casualty of war, and judging from last year’s charges against the bill, this is, indeed, a war–and one that is virtually certain to continue for at least two more years and, probably, a good deal longer than that.

12:45 [Comment From Tom Merrill: ] In your contribution to the December article, “Systemic Reform of Health Care Delivery and Payment” you mentioned the danger of Insurance companies dumping expensive patients into the state exchanges once they are operational. Do you see a similar risk with employers? And if so, surely that would affect costs at the state level, in turn affecting how hard the bill will be fought by state officials. Your thoughts…

12:48 Henry Aaron: This is a terrific question, because it highlights something too often ignored. Specifically, this is a HUGE bill that promises to transform one-sixth of the U.S. economy–how care is delivered, how it is paid for. Predicting the effects of any such bill, even if done honestly (as the CBO has done) is fraught with uncertainty. What employers will do is one of those uncertainties. Projections assume that most employers will continue to sponsor insurance for their employees. But over time, that could change. If it does, the health insurance exchanges will become much more important faster than anyone anticipated.

12:48 [Comment From Rocco: ] Are Republicans concerned that total repeal will hurt their electoral prospects among young people? Are there any plans in place to mitigate that risk?

12:50 Henry Aaron: I think that Republicans believe that repeal is a ‘winner’ for them. I think that they are wrong…in two ways. First, advocates of reform have a good product to defend…not a perfect one, but a very good one. If they work at it, I think they can win the debate. Second, if the ACA is repealed, the Republicans ‘own’ all of the health problems that will remain…increasing lack of insurance coverage, sharply rising costs, and less-than -ideal quality of care. As the old saying goes: be careful what you wish for; you might get it.

12:51 [Comment From Ryan: ] Fierce Healthcare today said that if the Republicans got their way with repeal, Rep. Giffords would not get the care she needs. But isn’t the call to “repeal and replace”, rather than just repeal?

12:52 Henry Aaron: The call is, indeed, to repeal and replace. The problem is that the opponents of the ACA haven’t provided a replacement. I doubt that they will be able to do so in ways that promise a sizeable extension of health insurance coverage, unless they embrace far more radical legislation than the ACA, something they have given no indication of being willing to do.

12:52 [Comment From Jennifer S.: ] How do the political sides break down here in terms of interest groups – who’s for the bill, who’s against it, and how are they waging the battle?

12:53 Henry Aaron: The striking thing about this debate is that most provider groups support the ACA. They might want to modify it, but they don’t want to repeal it. That fact contrast sharply with previous debates, where provider groups tended to be opposed.

12:54 [Comment From Dennis Soule: ]
How does the ACA encourage businesses to provide health care to employees instead of simply letting the new exchanges provide the insurance?

12:55 Henry Aaron: In the near term, subsidies are available to small businesses. In the longer term, firms larger than a minimum size will have to pay a penalty if they don’t provide coverage. The penalty is not large and some might choose to pay it, but most will not.

12:55 [Comment From Leslie Gardener: ] All the pollsters say that when you ask people about the law, they oppose it, but when you break down the components, they favor the indviidual parts of the law. Did Obama and the Democrats fail to make the case? Is it too late?

12:56 Henry Aaron: Simple answer. Yes, they failed to make the case. No, it isn’t too late to do it. Stay tuned!!

12:56 [Comment From Sheilah: ] When it comes to de-funding — is the expansion of Medicaid likely to be targeted, or is that expansion now built into the Medicaid entitlement and not subject to annual appropriations?

12:57 Henry Aaron: No. Medicaid is covered by a rule that provides funds automatically for those who are eligible for benefits. If the states succeed with their part of the implementation job, this will go ahead.

12:57 [Comment From Dan K: ]
How accurate are the complaints that the cost is much higher than the CBO estimates, because of bad starting assumptions? For example, I was going to mention Congress cutting Medicare reimbursements to doctors – is that the SGR system mentioned earlier?

12:58 Henry Aaron: The costs could be much higher, but they could also be much lower. As I wrote a few questions back, whenever one is dealing with legislation as far reaching as this, forecasting of quite risky.

12:58 [Comment From Genevieve R.: ] What about the back-and-forth between CBO and the GOP about the cost of the bill and whether or not it actually reduces the deficit? I mean, numbers are numbers — is this reallty a matter of opinion or fact? What’s true?

1:01 Henry Aaron: CBO has given an honest, best guess of the overall costs and the impact on the budget. The Republican critique points to some ways in which costs might be higher, but it also includes some charges that are bogus and irrelevant and neglects the fact that CBO was extremely parsimonious in scoring savings from the pilots and experiments that will amass knowledge about cost reducing changes in payment and delivery–bundled payments, accountable care organizations, and so on–which, if successful, could revolutionize the way we produce health care and pay for it, saving vast sums both for the government and for private payers.

1:02 Seung Min Kim: And we’ll wrap it up here for today. Thanks to Henry for answering all your great questions.