Now that Donald Trump won the popular and electoral vote and captured majorities in the House and Senate, the prospect of repealing Obamacare is back on the table.
But the Republicans’ razor-thin majority in the House and their 53-47 margin in the new Senate make a sweeping overhaul of Obamacare unlikely, say analysts. Furthermore, Obamacare was barely mentioned in the campaign, being overshadowed by inflation, the crisis at the southern border, and public safety.
The nation had been down that path once before. “Repeal and replace Obamacare” was the battle cry of congressional Republicans in the run-up to the 2016 general election.
Republicans captured the House, the Senate, and the White House. Then, the unexpected happened. Republicans singularly failed to repeal, much less replace, the Affordable Care Act (ACA).
Obamacare Worse
Ten years now out of the gate, Obamacare is a fully entrenched health care insurance system whose tentacles extend to Medicaid, the individual market, and employer health care. As with any broad-based government enactment, the ACA has had its share of unintended consequences. Whatever fixes a new Trump administration can order, fixes will be limited in scope and could be overturned by a future Democrat administration. Though the climb is steep, legislation remains the only option for lasting change.
There is a strong case for reforming Obamacare, says John C. Goodman, president of the Goodman Institute for Health Care Policy and co-publisher of Health Care News.
Obamacare is costing roughly $240 billion a year,” Goodman wrote at Forbes before the election. “Yet we are not getting any additional health care. … Doctor visits per capita for the country as a whole have actually gone down, and visits to the emergency room haven’t changed.”
“The original promise of Obamacare was to insure the uninsured with private health insurance,” wrote Goodman. “In fact, almost all the increase in health insurance under Obamacare has been an increase in Medicaid.”
Deductibles in the insurance plans offered on the exchanges are two or three times higher than most employer plans. “The typical plan sold in the (Obamacare) exchange looks like Medicaid with a high deductible. It is not accepted by many doctors and medical facilities, and if enrollees go out of network, the plans usually pay nothing.”
Recalling 2017
By four votes in 2017, House Republicans scrapped the Obamacare original mandate. They phased out the ACA’s Medicaid expansion.
Using the legislative procedure known as budget reconciliation, which requires only 51 votes for passage, Senate Republicans tried to pass a bare-bones repeal of Obamacare. The effort failed when three Republicans—Lisa Murkowski (AK), Susan Collins (ME), and John McCain (AZ)—joined all 48 Democrats in voting no. The Senate repealed the individual and employer mandates but otherwise left Obamacare’s structure largely in place.
Less than a week before the November 5, 2024 election, House Speaker Mike Johnson (R-LA) told reporters the ACA is “deeply ingrained” and would require “massive reform,” while saying the GOP’s Doctors Caucus has been working on reform proposals.
In May 2023 Rep. Pete Sessions (R-TX) introduced the Health Care Fairness for All Act, a massive health care reform bill that attempts to break from the mold of conventional thinking by expanding personal choice in health care.
The bill provides Americans with a tax credit to purchase insurance on the individual market or deposit in a health savings account. The bill failed to gain traction and would have to be reintroduced in a new Congress.
Repeal, Undoable
Although a sweeping overhaul of Obamacare is unlikely and probably not possible, Congress could pass reforms to repair some of the damage, says Devon Herrick, Ph.D., a health economist and policy adviser to the Heartland Institute, which co-publishes Health Care News.
“Obamacare so thoroughly destroyed the health insurance market that it would be impossible to go back to risk-related health coverage,” said Herrick. “I suspect Trump will tinker around the edges, possibly scaling back Biden’s premium subsidies. The Trump administration will possibly enforce greater transparency and maybe address shortcomings in the No Surprise Act.”
Herrick added. “One area of consensus is the need to enact site-neutral payments. A real concern is that Trump’s picks to run the Department of Health and Human Services, Robert F. Kennedy Jr., and Centers for Medicare and Medicaid Services, Mehmet Oz, M.D., do not have a history of advocating for market-based health reform.”
Congress may try to move forward on increasing the allowable size of HSAs, says Merrill Matthews, Ph.D., a scholar at the Institute for Policy Innovation.
“That essentially allows employers to deposit all of the money an employer spends on an employee’s health insurance into an HSA, and then the employee can buy his own health insurance from the account,” said Matthews.
Other Possible Reforms
Congress might also loosen the restrictions the Biden administration put on association health plans, says Matthews.
“There has been a decades-long effort to allow trade associations to offer self-funded health insurance coverage as large employers offer,” said Matthews. “That allows the associations to bypass some government-imposed mandates.”
Association health plans would expand the availability of more affordable insurance large employers can offer because of the much bigger risk pools.
Congress could also remove restrictions on short-term plans (see related article, page 3) and “allow that market to create and offer policies people want, though still generally for shorter terms,” said Matthews.
In any case, Congress and Trump will not ignore health care, says Matthews.
“I am sure Republicans will try to cut the expanded subsidies for Obamacare,” said Matthews. “It’s possible Republicans will also try to cut back some of the mandates in Obamacare, such as free contraceptives and the mandate to cover every contraceptive. Before ACA, most insurers covered some, but usually not all, contraceptives, with a small copay.”
Bonner Russell Cohen, Ph.D., (bcohen@nationalcenter.org) is a senior fellow at the National Center for Public Policy Research.
