Policy-Politics-Regence(4)

Politics in 2015: The crystal ball is cloudy

By Julie Barnes, Director of Health Policy | January 19, 2015

Understanding policy changes has become essential to navigating today’s shifting health system. With Congress firmly led by the Republican Party, a slim majority in the U.S. Senate and a Democrat in the White House, it is harder than ever to know what to expect from our policymakers this year.

One thing is easy, though: No matter how many Republicans or even Democrats vote to repeal the Affordable Care Act in its entirety, President Obama will be sure to quickly use his veto pen. After that, it gets more complicated. Let the guessing game begin.

Are Big Policy Changes Possible?

Yes, big changes could happen this year, but thinking them through requires us to play the “if, then” game.

If the U.S. Supreme Court rules in King v. Burwell that the federal government cannot continue to give individuals subsidies in the federal insurance exchanges – something the Court will decide in June that affects more than 4 million people and would raise premiums an estimated 35% – then Congress may pass a law to fix it.

If Republican leaders decide that supporting Obamacare would be worth the opportunity to fix or eliminate other provisions (editorial note: an unlikely scenario, especially in the context of the upcoming 2016 presidential), then many big changes are possible, including:

  • Repealing the health insurance tax, medical device tax, and several other ACA taxes (except the individual mandate penalty - the Administration won’t agree to its repeal)
  • Changing the employer mandate’s definition of full-time employees from 30 to 40 hours per week (the House has already passed this legislation, but its fate is still unknown)
  • Eliminating the Individual Payment Advisory Board, a committee that can make changes to Medicare if costs exceed a certain threshold
  • Allowing states to offer premium support of private health plans rather than expand Medicaid to low-income individuals
  • Repealing the risk corridor program, which helps insurance companies that participate in the new exchanges recoup their losses if they ended up with a high-risk enrollment population

If Republicans decided to propose these and other changes, then the Obama Administration has to decide whether to waiver on their stance regarding federal subsidies in the exchanges…a big “if.”

And if the Supreme Court allows the federal subsidies to continue in the federal insurance exchanges, then the Republicans will have to come up with another “must-have” that convinces the Administration to make some of these trade-offs.

Will Our Congressional Leaders Have Any Influence?

Two of the most powerful players in the U.S. Congress are Utah Senator Orrin Hatch, who now chairs the Senate Finance Committee, and Oregon Senator Ron Wyden, who just stepped down as chairman and is now the ranking minority member. They could collaborate to repeal and replace the Sustainable Growth Rate formula, which would raise physician payment rates in Medicare while gradually shifting compensation from fee-for-service to pay-for-performance.

Senator Hatch is the main player who determines what to propose to fix Obamacare, but he will need to compromise with Democrats to pass major legislation.

Also worth noting is that Washington Senator Patty Murray is the ranking Democrat on the Health, Education and Labor Committee, which has jurisdiction over the FDA, labs, and education and training of health professionals.

Finally, state legislatures throughout Regence’s four state footprint have either convened or will soon. Their actions will certainly have an impact on at a local level throughout 2015.

When We Will Hear More About This?

Regence’s Government Affairs team will be monitoring and tracking these key health policy changes – with more news and analysis to come as these developments unfold throughout the year.

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