The future of the Affordable Care Act is uncertain in Washington, and there are several scenarios under consideration.
The latest possible changes could impact New York’s relatively healthy health care system.
The good news is that the Affordable Care Act in New York is doing quite well, according to state officials. The health insurance exchanges are functioning, with 17 carriers offering plans in 2017. State Attorney General Eric Schneiderman, at a recent rally to preserve the ACA, said New York has built “one of the best health care exchanges in the country."
“Since 2013 we have cut our uninsured in half,” Schneiderman said. “From 10 percent to 5 percent of our population."
The price of premiums in the individual market in New York actually went down slightly in 2016, by around 4 percent, although the state still has among the highest priced insurance plans in the nation. Employer-based insurance plan prices also declined by 1 percent.
But the existing Republican Senate and House plans to repeal and replace the ACA, also known as Obamacare, would be extremely disruptive to New York’s system, say state officials and health experts.
Governor Cuomo’s Medicaid director, Jason Helgerson, said the Senate’s latest attempt to repeal the ACA but not replace it with anything for two years (so-called "repeal and delay") would also be very harmful.
“The issue is uncertainty,” said Helgerson.
Helgerson said under a repeal, there would no longer be a requirement for people to join the individual insurance market if they didn’t have a health care plan. But other rules, such as not discriminating against people with pre-existing conditions, might remain in place.
“The risk and concern is that you’ll see insurance companies very fearful that they’re going to get only sick people buying their products,” Helgerson said. “And it would affect their ability to be viable financially.”
Bill Hammond, the director of health policy for the fiscal watchdog group The Empire Center, agrees that that combination would lead to a “death spiral.” And he said it already happened in New York before Obamacare, when the state’s individual insurance market was crashing.
“At the very end, in 2012, insurers were applying to the (state) insurance department for permission to charge over $100,000 a year for insurance,” Hammond said.
Under the repeal and replacement plans by Republicans in Congress, New York would lose several billion dollars a year in Medicaid funding.
After the Senate could not come up with the votes needed for a repeal, President Trump said he might just let Obamacare “fail.” There are several steps the Trump Administration could take to sabotage it.
The IRS could stop enforcing the penalties imposed on uninsured Americans who don’t buy health care plans on the individual market. And administration members could essentially continue to badmouth Obamacare. Hammond said that would cause instability in the insurance market.
“The insurance companies are aware that’s going to scare away customers,” Hammond said. “It’s going to scare them away, too.”
Hammond says insurance companies may be reluctant to invest in a market that is “actively opposed by the sitting President."
Helgerson said if Trump were to follow through with his threats, it would be an abdication of his responsibilities. “The federal government has a responsibility, [the] President included, to administer the laws of the country,” said Helgerson. He added it would be a “very serious problem” to discourage people from accessing services “to which they are entitled.”
The Trump Administration would not have the power, though, to reduce Medicaid payments to states. New York would continue to receive billions of dollars a year in additional funding for its Medicaid expansion programs for now.