The Great 2016 Health Reform Debate (or Not)

Let’s face it, health reform in 2014 is going to be pretty boring from here on out. Why? It’s an election year. That might seem counterintuitive, since the Affordable Care Act (ACA) demonstrated the haunting dance of partisan politics and policy making at its least consensus building. So why the yawns for 2014? Because the positions of the advocates and detractors of ACA are pretty well set in stone going into the mid-term elections.

Democrats’ 2014 position on ACA is to defend it through the election. With 8 million or so people signed up in the health insurance exchanges, the Democrats are able to claim a reduction in the national level of the uninsured not seen since Medicaid started in 1967. The GOP 2014 position on ACA is to continue to fight for “repeal and replace.”

Replace legislation actually exists now, highlighting that this is a serious gambit and justifying why the GOP should take control of the US Senate and hold the US House of Representatives. With control of both houses, ACA could be altered if the lame duck Obama administration sees opportunities to work together to fine tune the law. (And if the evil queen from Sleeping Beauty can make a Disney box office, anything may be possible.)

The big question mark is 2016. The presidential election will not be a referendum on the ACA as some claimed it was in 2012. By early 2016, three waves of open enrollment in the insurance exchanges will have taken place. Growing enrollment in narrow networks or high deductible health plans due to relatively lower premium increases in these designs will have either engendered begrudging public acceptance or outcry.

For the Democrats, the question will be how to run on health reform in 2016. Will the position be to defend it the same way Supreme Court justice nominations are used to justify a presidential choice? Will the position be to double down on reform and seek find a way to get the remaining 30 million or so uninsured some level of coverage? Will the electorate be exhausted after seven years of acrimony and tune out the next wave of politicking?

The Republicans have no easy answers either on how to run on health reform in 2016. Part of the problem is that after the Supreme Court ruling and many against statute changes by the Obama administration, the ACA looks a lot more like the plan from 2008 Candidate McCain than the 2008 Candidate Obama plan.

For the Republicans, one strategy will be to articulate a grand bargain of sweeping health reform bundled with entitlement reform. If the party chose such as strategy, it would bold and way to storm back into the debate claiming that the Democrats failed with ACA implementation because it never fulfilled their true aim of establishing a single payer system. Best to let architects of market-based health reform with the knowledge and respect for the insurance and medical innovation industries take a turn at leadership.

Much will depend on the candidates from either party. Joe Biden is far more likely than Hillary Clinton to double down on the ACA, since he was there at the birth and thought it to be a big ___ deal. Paul Ryan is singly able to articulate a grand bargain strategy with a vision and with budget accounting expertise. Most other likely Republican candidates have yet to articulate a health reform vision other than repeal first and replace someday later with someone else’s plan.

Both parties likely hope to avoid any health reform debate in 2016. But the wheels of statutory and actuarial fate will likely force them have articulate a plan. Why? Without further refinement from the Obama administration, premium increases from the end of a qualified health plan (QHP) enforcement waiver as well as the elimination of the 2 of the 3 Rs (reinsurance and risk corridors) could be as high as 20% or more. A recent working paper Michael Ramlet and I posted shows that several million may lose coverage because of the premium spike as well.

Come summer and autumn 2016, when the ACA will likely need an ‘insurer fix’ to keep premiums from spiking, Democrats will yet again need to defend a law that is increasingly proving to be unaffordable.

This may give Republicans an advantage, but I’m not so sure. The Grand Old Party needs a viable alternative that provides a common rallying position. With it, Republicans will be able to run as a party with both a strategic vision and a tactical plan. Without it, Republicans will remain in zone defense and perhaps lose the long war for recapturing a leadership position on market-based health reform.

Morning Consult