Health Policy after the Mid-Terms: NCPA’S Early Take

Republican candidates won a decisive victory at the voting booth on Tuesday, in all races: House, Senate, governorships and NCPA Logo 320The NCPA is a think tank, established in 1983, that develops and promotes free-market reforms in health care, taxes, retirement, education, energy and the environment.state legislatures. The future of Obamacare has never looked worse.

The next battle is more daunting: the Republican Party needs to avoid shooting itself in the foot, govern in a way that achieves results rather than perpetuates partisan bickering and continue to develop patient-centered health reform for the post-Obamacare future.

Although Obamacare itself will not be repealed until January 2017, Republican success yesterday gives depth, resilience and energy to the post-Obamacare health reform movement.

Here is a list of some priorities for the new Congress:

  • Repeal the excise tax on medical devices. This enjoys broad, bipartisan support — even from Democrats who voted for it when they imposed Obamacare on the nation. The tax is grabbing far less revenue than expected. Nevertheless, an important question stands out: How to pay for the lost revenue under Congress’ scoring rules? Some argue that repeal needs no offset; the industry would prefer that repeal be paid for via corporate tax reform; but grassroots conservatives will be skeptical unless the lost tax revenues are offset by Obamacare spending cuts.
  • Shore up Medicare Part D Drug Plans by allowing them to better control fraud, which many Democrats support. Who could be against that?
  • Obamacare discourages patient-focused innovation in health insurance plan design. Some Democrats have voiced support for the health insurers’ proposed “copper plan.” This is a point of leverage to open discussions on a wide variety of plan designs that suit patients’ needs, not politicians’ preferences.
  • Improve risk adjustment in Obamacare plans. Republicans have been full-throated in their opposition to Obamacare’s “bailout” of insurers that lose money in exchanges. However, there is a bigger problem with Obamacare plans: They encourage insurers to seek out healthy subscribers and shun sick ones. Congress should reform the risk-mitigation mechanisms in Obamacare so that they are more like those of Medicare Advantage.
  • Put Obamacare’s exchanges out of their misery! The exchanges’ failures were obvious to every American, and they are unlikely to improve. Stop the hundreds of millions of dollars surging to IT firms and navigators, and allow people to buy their plans from agents, whether online or in-person, without going through an exchange.
  • Shrink the Medicaid expansion as much as possible. Medicaid has entered a fiscal death spiral into which the federal and state governments are pulling each other. By identifying opportunities to cut back the Federal Matching Assistance Percentage (FMAP) or the income eligibility for the expansion, Congress can further reduce Medicaid dependency from Obamacare’s original vision.
  • Greater flexibility in state Medicaid programs to allow states to tailor their Medicaid programs to meet each state’s unique needs. Wisconsin provides a recent example of success.
  • Reduce the power of the Food and Drug Administration to prevent patients from using experimental new therapies. The FDA’s bureaucratic burden has increased dramatically, and it needs to be reined in.

For the last three items, Congress will have eager collaborators in the states. Rather than caving in to Medicaid expansion, increased Republican majorities in state houses indicate that states will increase their opposition to making more people dependent on this type of charity care. They will also be looking to follow Wisconsin and Rhode Island and some other states in implementing successful waivers that allow them to contain costs and improve patient care. Finally, an increasing number will likely consider passing the “Right to Try” Act, which asserts state independence from FDA over-regulation.

Real health reform is just over the horizon. We look forward to continuing to inform the nation’s debate over what shape that will take.

SOURCE: NCPA