Trump administration to focus on ACA reform, tort reform

Look for three things from the Trump administration: significant changes to the Affordable Care Act, few changes to MACRA’s Quality Payment Program, and a conservative swing in the courts.

Republicans have had their sights on the Affordable Care Act since its passage in 2010; with majorities in both the House and the Senate, the question is not if, but when President Obama’s signature piece of legislation will be dismantled.

President-elect Donald Trump ran on the promise of ACA repeal. Health policy priorities on his transition website focus on greater use of health savings accounts, the ability to purchase insurance across state lines, and the reestablishment of high-risk pools.

Health policy experts differ in how they see ACA reform coming about, with some predicting a quick repeal coupled with an immediate legislative replacement, while others envision repeal with more time to craft replacement legislation. Reform also could come as a series of smaller bills rather than one comprehensive package.

“I do think that [the new administration is] going to deliver on the repeal provision early on, but it is also likely to come with a bridge so that people are not thrown off their coverage,” Grace-Marie Turner, founder and president of the Galen Institute, said in an interview. She noted that one of the last ACA repeal efforts by congressional Republicans used the budget reconciliation process and included a 2-year transition period to spare 20 million people from losing their coverage while replacement legislation makes its way through Congress.

Using budget reconciliation would not allow for full ACA repeal since only provisions that involve revenue generation or spending could be altered. However, since budget reconciliation bills cannot be filibustered, only a simple majority is needed for Senate passage. With their razor-thin majority – 51 seats – Republicans will need some support from outside of their own party.

“Twenty-some Democrats, many in very-deep ‘red states’ including North Dakota, are up for reelection in 2018,” Ms. Turner said. “They saw what happened to the candidates who supported Obamacare in 2016 – many of them went down. It happened with Evan Bayh in Indiana, who was running again to reclaim the Senate seat he left in 2010. And the Republican candidate [Todd Young] reminded the voters over and over that Evan Bayh voted for Obamacare. Same thing happened in Wisconsin with [Republican] Sen. Ron Johnson being challenged by Russ Feingold, who also was in the Senate when Obamacare passed. Feingold went down to defeat again. I think the lot of Democratic senators are going to be looking at what happened to those people and think ‘Maybe I better participate in coming up with a more sensible solution.’ ”

More importantly, the GOP may be looking for bipartisan support, especially since the ACA passed on a strict party-line vote. To that end, it could make more sense to delay reform efforts until a broader coalition can be formed and simultaneous repeal/replace package could be brought to both the House and the Senate floors.

“Honestly, I think it would be better if they delayed the repeal vote,” Gail Wilensky, PhD, senior fellow at Project HOPE, said in an interview. “It would be better in terms of the political dynamics of maybe being able to get possibly some Democratic support for the replacement legislation, which I think will be impossible to get if they do the repeal as a standalone.”

In the new Congress, Senate Republicans might face some of the same obstructionist tactics they used during the Obama administration, which could complicate efforts to get bipartisan support.

“When you have people like Sen. [Bernie] Sanders (I-Vt.) and Sen. [Elizabeth] Warren (D-Mass.) saying they are going to adapt a scorched earth approach going forward, they and their followers don’t have any intention of doing anything that would in any way appear to cooperate with the Republicans,” Dr. Wilensky said. “Of course, there are other Democrats, especially some of the ones who will be up in 2018, who might not be quite so adamant.”

ACA repeal without immediate replacement could wreak havoc in the health care insurance marketplace, according to Sara R. Collins, PhD, vice president of health care coverage and access at the Commonwealth Fund.

“Repeal without a clear idea of what the replacement would be would really throw that market into chaos, where right now we are at a place where the markets are relatively stable,” Dr. Collins said in an interview.“The best way to think about the ACA, and particularly on the marketplaces and what repeal means, is this image of the three-legged stool. The individual market is the seat and the legs include consumer protections, particularly guaranteed issue; the individual requirement to have insurance; and the subsidies to make that coverage affordable – Medicaid expansion is part of that as well. If you start to remove any one of those legs, the market becomes extremely unstable.”

Repealing the individual mandate is problematic as it goes hand in hand with the ban on coverage denial because of preexisting conditions, something President-elect Trump has signaled he is looking to maintain, Ms. Turner said, adding that free market solutions with appropriate incentives could be a different way to encourage healthy people to get coverage to help generate premium revenue to cover patients with preexisting conditions.

While the ACA will be in the crosshairs, experts expect MACRA to remain more or less intact, maybe with some minor tweaks, at least early on.

While the Medicare Access and CHIP Reauthorization Act of 2015 passed with overwhelming support from both parties, “the [implementing regulations] are just a nightmare and I think the Trump administration is going to have to take a look at them,” Ms. Turner said. She added that physicians are weary of the ever-growing federal administrative hassles. “You do not want doctors to leave private practice in droves, and they are looking at this cost of compliance.”

“I think that [MACRA] is just way too much of an in-the-weeds policy thing for the Trump administration to have addressed yet,” Ms. Turner continued. “But this certainly is going to have to be on the agenda because they are going to hear from a lot of doctors that this is not acceptable.”

“The question is how much gain and pain is there in uprooting something that has its own built-in momentum, even though people in the midst of that will complain about aspects and want adjustments,” Thomas P. Miller, resident fellow at the American Enterprise Institute, said in an interview.

Mr. Trump also has called for Medicaid reform, with block grants to the states.

“Everyone keeps talking about a block grant, but that is a clumsy way of doing it,” Ms. Turner said, suggesting the program be even more refined to cover people in different baskets, including dual-eligibles, healthy adults that were part of the ACA Medicaid expansion, mothers and infants, and disabled individuals. “A capitated allotment [allows the government to provide more support to] the people who need it.”

Dr. Wilensky suggested that the Trump administration could revisit the 1332 waiver process, another provision of the ACA.

“The current administration has taken a very-rigid view on that you have to keep savings from Medicaid and the ACA separate and any changes have to be budget neutral to each, which is an extremely rigid set of requirements,” she said. Instead “Medicaid and ACA savings could count together and it just needs to be budget neutral over a 3- or 5-year period. That would then allow states to come in and request a lot of flexibility that the current administration hasn’t been inclined to give them.”

Likewise, the Children’s Health Insurance Plan (CHIP) is up for reauthorization. While the program remains relatively popular, it could be due for some reforms as well. Dr. Wilensky said it might be time for the program to go away, though doing that would face resistance from congressional Democrats.

Likewise, Ms. Turner suggested it could be time to fold CHIP into another program like Medicaid.

“Does it really make sense for a mother who is overwhelmed, maybe even with two jobs, to have her kids on a different health insurance program than she’s on?” Ms. Turner said. “It just adds to the burden and the paperwork. Would it make more sense to blend some of these programs together, making sure the people get the health coverage they need, but without all these artificial silos that really make it much more difficult for the user at the other end. I think they are going to take a look at that.”

Whether the ACA is amended or repealed may affect some – but not all – of the ACA-related cases lingering in the courts.

Zubik v. Burwell for instance, may become irrelevant if President-elect Trump eliminates the ACA’s birth control mandate or its accommodation clause. Zubik centers on an exception to the birth control mandate for organizations that oppose coverage for contraceptives but are not exempted entities, such as churches. The plaintiffs argue that the government’s opt-out process makes them complicit in offering contraception coverage indirectly.

The Trump administration could choose to broaden the mandate’s exemption to include the religious organizations, thus satisfying the plaintiffs, said Timothy S. Jost, a health law professor at Washington and Lee University in Lexington, Va., who added that the case would become moot if the ACA is repealed wholesale.

“Millions of women [currently] get access to birth control without cost sharing through the Affordable Care Act,” he said in an interview. “That’s an issue [the new administration] is going to have to confront.”

In March, U.S. Supreme Court justices requested that both sides provide new briefs that outlined how contraception could be provided without requiring notice on the part of the suing employers. Then, in light of the briefs, the high court vacated the lower court rulings related to Zubik and remanded the case to the four appeals courts that had originally ruled on the issue.

If the case makes its way back to the Supreme Court, the ultimate ruling will largely depend on the makeup of the court at the time, said Eric D. Fader, a New York–based health law attorney.

“As long as we have a 4-4 Supreme Court, everything is up in the air,” Mr. Fader said in an interview. “As soon as that ninth slot is filled, I think we’re going to see some decisions that are going to be in line with traditional Republican conservative positions.”

However, a set of ACA-related cases that involve payments to insurers will continue litigating, regardless of actions by the new administration, analysts said. A half-dozen health insurers have sued the Health & Human Services department over alleged underpayments under the ACA’s risk corridor program.

 

“Even if you do away with the ACA, these cases all pertain to conduct that has already occurred, so they’re not going to be automatically moot,” Mr. Fader said in an interview. “They may struggle along for a while.”

The cases stem from the ACA’s risk corridor program, which requires HHS to collect funds from excessively profitable insurers that offer qualified health plans under the exchanges, while paying out funds to QHP insurers that have excessive losses. Collections from profitable insurers under the program fell short in 2014 and again in 2015, resulting in HHS paying about 12 cents on the dollar in payments to insurers.

The plaintiffs allege they’ve been shortchanged and that the government must reimburse them full payments for 2014. The Department of Justice (DOJ) argues the cases are premature because the full amount owed under the program is not due until 2016, after the program runs its course.

The Trump administration may surrender another ACA-linked challenge that questions billions in payments made to insurers, Mr. Jost said in an interview. In House v. Burwell, the House of Representatives accuses HHS of wrongly spending billions to repay insurers for health insurance provided to certain low-income patients under the ACA. The House claims HHS is illegally spending monies that Congress never appropriated. HHS argues that other statutory provisions of the ACA authorize expenditures for cost-sharing reimbursements. In May, the U.S. District Court for the District of Columbia decided in favor of the House, ruling that Congress never appropriated money for the payments and that no public money can be spent without an appropriation.

There is speculation that the Trump administration may not pursue an appeal, Mr. Jost said. “I think they better think long and hard about that because I don’t know why any president would want court precedent saying one house of Congress can sue the president whenever it disagrees,” he said. “If the Trump administration would give in on the lawsuit or the House would win … there would be some very large losses and some very large premium increases next year. There could be some very significant disruption of insurance markets.”

Again, if the ACA is repealed, the case may become irrelevant, Mr. Fader said. “If you get rid of the ACA and eliminate the cost sharing structure, than House v. Burwell is going to just be moot.”

Weaker enforcement of antitrust regulations in health care also could be on the horizon, said William W. Horton, a Birmingham, Ala.–based health law attorney and past chair of the American Bar Association Health Law Section.

“We have seen a substantial uptick in antitrust enforcement activity in health care over the last several years,” he said in an interview. “The Trump administration has said that one of its themes is reducing the regulatory burden on businesses. People will be watching to see if that means an attempt to back off of some of the more-aggressive antitrust enforcement activities in health care and other industries.”

The Obama administration is currently fighting to block two mega-mergers among four of the largest health insurers in the nation. The DOJ filed legal challenges earlier this year seeking to ban Anthem’s proposed acquisition of Cigna and Aetna’s proposed acquisition of Humana. The lawsuits allege the mergers – valued at $54 billion and $37 billion respectively – would negatively affect doctors, patients, and employers by limiting price competition, reducing benefits, and lowering quality of care. A majority of physician associations and patient groups oppose the mergers. But experts said the new administration could drop the challenges.

Similarly, the Trump administration could be more lax in its enforcement of the Stark Law. “You could certainly say if the administration is committed to reducing regulatory burden, one thing the administration might push forward is reducing some of the enforcement with respect to technical violations of Stark,” Mr. Horton said, noting that the Senate recently questioned if the government is going too far in regulating physician relationships under Stark. “If your theme is ‘Let’s cut back on regulation,’ that would be an area that you would think the administration would look at.”

Meanwhile, stronger medical malpractice reforms could be on the horizon in light of a Republican-controlled Congress. Tort reform advocates have a good chance at passing federal medical liability reforms that were left out of the ACA’s passage in 2010, said Dennis A. Cardoza, public affairs director and cochair of the federal public affairs practice at a national health law firm.

Earlier versions of the ACA included amendments that mandated lawsuits go through a state or federal alternative dispute resolution system prior to being filed in court. Another provision that failed would have provided federal grants to states that created special health courts for medical malpractice claims. The amendment would have allowed states to create expert panels, administrative health care tribunals, or a combination of the two.

“There’s much stronger support for tort reform among the Republicans in Congress,” Mr. Cardoza said in an interview. “There’s a shot [now]. If the reforms don’t go too far where they would penalize injured patients, I think they could get additional support and be well received by the Congress.”

Tougher abortion restrictions are likely under the Trump administration, experts said. President-elect Trump has said he is committed to nominating a ninth Supreme Court justice who opposes Roe v. Wade.

“The new justice is almost certain to swing the court in a conservative direction,” said Rep-elect Jamie Raskin (D-Md.), a constitutional law professor at American University in Washington. “The stakes are extremely high in the health care field as in every part of Supreme Court jurisprudence.”

Vice President-elect Mike Pence, who is considered a strong voice for the religious right, will likely influence who Mr. Trump nominates for the high court, said Rep-elect Raskin, who added that if ever there was time that abortion rights are in jeopardy, it’s now.

“This really puts the Republicans to the test,” he said in an interview. “For decades now, they have been calling for the overruling of Roe v. Wade. The religious right will never forgive them if it doesn’t happen now. [Republicans] control the House, the Senate, and the White House. They have it within their reach to create a five-justice majority on the court.”

gtwachtman@frontlinemedcom.com
agallegos@frontlinemedcom.com
On Twitter @legal_med
 

Look for three things from the Trump administration: significant changes to the Affordable Care Act, few changes to MACRA’s Quality Payment Program, and a conservative swing in the courts.

Republicans have had their sights on the Affordable Care Act since its passage in 2010; with majorities in both the House and the Senate, the question is not if, but when President Obama’s signature piece of legislation will be dismantled.

President-elect Donald Trump ran on the promise of ACA repeal. Health policy priorities on his transition website focus on greater use of health savings accounts, the ability to purchase insurance across state lines, and the reestablishment of high-risk pools.

Health policy experts differ in how they see ACA reform coming about, with some predicting a quick repeal coupled with an immediate legislative replacement, while others envision repeal with more time to craft replacement legislation. Reform also could come as a series of smaller bills rather than one comprehensive package.

“I do think that [the new administration is] going to deliver on the repeal provision early on, but it is also likely to come with a bridge so that people are not thrown off their coverage,” Grace-Marie Turner, founder and president of the Galen Institute, said in an interview. She noted that one of the last ACA repeal efforts by congressional Republicans used the budget reconciliation process and included a 2-year transition period to spare 20 million people from losing their coverage while replacement legislation makes its way through Congress.

Using budget reconciliation would not allow for full ACA repeal since only provisions that involve revenue generation or spending could be altered. However, since budget reconciliation bills cannot be filibustered, only a simple majority is needed for Senate passage. With their razor-thin majority – 51 seats – Republicans will need some support from outside of their own party.

“Twenty-some Democrats, many in very-deep ‘red states’ including North Dakota, are up for reelection in 2018,” Ms. Turner said. “They saw what happened to the candidates who supported Obamacare in 2016 – many of them went down. It happened with Evan Bayh in Indiana, who was running again to reclaim the Senate seat he left in 2010. And the Republican candidate [Todd Young] reminded the voters over and over that Evan Bayh voted for Obamacare. Same thing happened in Wisconsin with [Republican] Sen. Ron Johnson being challenged by Russ Feingold, who also was in the Senate when Obamacare passed. Feingold went down to defeat again. I think the lot of Democratic senators are going to be looking at what happened to those people and think ‘Maybe I better participate in coming up with a more sensible solution.’ ”

More importantly, the GOP may be looking for bipartisan support, especially since the ACA passed on a strict party-line vote. To that end, it could make more sense to delay reform efforts until a broader coalition can be formed and simultaneous repeal/replace package could be brought to both the House and the Senate floors.

“Honestly, I think it would be better if they delayed the repeal vote,” Gail Wilensky, PhD, senior fellow at Project HOPE, said in an interview. “It would be better in terms of the political dynamics of maybe being able to get possibly some Democratic support for the replacement legislation, which I think will be impossible to get if they do the repeal as a standalone.”

In the new Congress, Senate Republicans might face some of the same obstructionist tactics they used during the Obama administration, which could complicate efforts to get bipartisan support.

“When you have people like Sen. [Bernie] Sanders (I-Vt.) and Sen. [Elizabeth] Warren (D-Mass.) saying they are going to adapt a scorched earth approach going forward, they and their followers don’t have any intention of doing anything that would in any way appear to cooperate with the Republicans,” Dr. Wilensky said. “Of course, there are other Democrats, especially some of the ones who will be up in 2018, who might not be quite so adamant.”

ACA repeal without immediate replacement could wreak havoc in the health care insurance marketplace, according to Sara R. Collins, PhD, vice president of health care coverage and access at the Commonwealth Fund.

“Repeal without a clear idea of what the replacement would be would really throw that market into chaos, where right now we are at a place where the markets are relatively stable,” Dr. Collins said in an interview.“The best way to think about the ACA, and particularly on the marketplaces and what repeal means, is this image of the three-legged stool. The individual market is the seat and the legs include consumer protections, particularly guaranteed issue; the individual requirement to have insurance; and the subsidies to make that coverage affordable – Medicaid expansion is part of that as well. If you start to remove any one of those legs, the market becomes extremely unstable.”

Repealing the individual mandate is problematic as it goes hand in hand with the ban on coverage denial because of preexisting conditions, something President-elect Trump has signaled he is looking to maintain, Ms. Turner said, adding that free market solutions with appropriate incentives could be a different way to encourage healthy people to get coverage to help generate premium revenue to cover patients with preexisting conditions.

While the ACA will be in the crosshairs, experts expect MACRA to remain more or less intact, maybe with some minor tweaks, at least early on.

While the Medicare Access and CHIP Reauthorization Act of 2015 passed with overwhelming support from both parties, “the [implementing regulations] are just a nightmare and I think the Trump administration is going to have to take a look at them,” Ms. Turner said. She added that physicians are weary of the ever-growing federal administrative hassles. “You do not want doctors to leave private practice in droves, and they are looking at this cost of compliance.”

“I think that [MACRA] is just way too much of an in-the-weeds policy thing for the Trump administration to have addressed yet,” Ms. Turner continued. “But this certainly is going to have to be on the agenda because they are going to hear from a lot of doctors that this is not acceptable.”

“The question is how much gain and pain is there in uprooting something that has its own built-in momentum, even though people in the midst of that will complain about aspects and want adjustments,” Thomas P. Miller, resident fellow at the American Enterprise Institute, said in an interview.

Mr. Trump also has called for Medicaid reform, with block grants to the states.

“Everyone keeps talking about a block grant, but that is a clumsy way of doing it,” Ms. Turner said, suggesting the program be even more refined to cover people in different baskets, including dual-eligibles, healthy adults that were part of the ACA Medicaid expansion, mothers and infants, and disabled individuals. “A capitated allotment [allows the government to provide more support to] the people who need it.”

Dr. Wilensky suggested that the Trump administration could revisit the 1332 waiver process, another provision of the ACA.

“The current administration has taken a very-rigid view on that you have to keep savings from Medicaid and the ACA separate and any changes have to be budget neutral to each, which is an extremely rigid set of requirements,” she said. Instead “Medicaid and ACA savings could count together and it just needs to be budget neutral over a 3- or 5-year period. That would then allow states to come in and request a lot of flexibility that the current administration hasn’t been inclined to give them.”

Likewise, the Children’s Health Insurance Plan (CHIP) is up for reauthorization. While the program remains relatively popular, it could be due for some reforms as well. Dr. Wilensky said it might be time for the program to go away, though doing that would face resistance from congressional Democrats.

Likewise, Ms. Turner suggested it could be time to fold CHIP into another program like Medicaid.

“Does it really make sense for a mother who is overwhelmed, maybe even with two jobs, to have her kids on a different health insurance program than she’s on?” Ms. Turner said. “It just adds to the burden and the paperwork. Would it make more sense to blend some of these programs together, making sure the people get the health coverage they need, but without all these artificial silos that really make it much more difficult for the user at the other end. I think they are going to take a look at that.”

Whether the ACA is amended or repealed may affect some – but not all – of the ACA-related cases lingering in the courts.

Zubik v. Burwell for instance, may become irrelevant if President-elect Trump eliminates the ACA’s birth control mandate or its accommodation clause. Zubik centers on an exception to the birth control mandate for organizations that oppose coverage for contraceptives but are not exempted entities, such as churches. The plaintiffs argue that the government’s opt-out process makes them complicit in offering contraception coverage indirectly.

The Trump administration could choose to broaden the mandate’s exemption to include the religious organizations, thus satisfying the plaintiffs, said Timothy S. Jost, a health law professor at Washington and Lee University in Lexington, Va., who added that the case would become moot if the ACA is repealed wholesale.

“Millions of women [currently] get access to birth control without cost sharing through the Affordable Care Act,” he said in an interview. “That’s an issue [the new administration] is going to have to confront.”

In March, U.S. Supreme Court justices requested that both sides provide new briefs that outlined how contraception could be provided without requiring notice on the part of the suing employers. Then, in light of the briefs, the high court vacated the lower court rulings related to Zubik and remanded the case to the four appeals courts that had originally ruled on the issue.

If the case makes its way back to the Supreme Court, the ultimate ruling will largely depend on the makeup of the court at the time, said Eric D. Fader, a New York–based health law attorney.

“As long as we have a 4-4 Supreme Court, everything is up in the air,” Mr. Fader said in an interview. “As soon as that ninth slot is filled, I think we’re going to see some decisions that are going to be in line with traditional Republican conservative positions.”

However, a set of ACA-related cases that involve payments to insurers will continue litigating, regardless of actions by the new administration, analysts said. A half-dozen health insurers have sued the Health & Human Services department over alleged underpayments under the ACA’s risk corridor program.

 

“Even if you do away with the ACA, these cases all pertain to conduct that has already occurred, so they’re not going to be automatically moot,” Mr. Fader said in an interview. “They may struggle along for a while.”

The cases stem from the ACA’s risk corridor program, which requires HHS to collect funds from excessively profitable insurers that offer qualified health plans under the exchanges, while paying out funds to QHP insurers that have excessive losses. Collections from profitable insurers under the program fell short in 2014 and again in 2015, resulting in HHS paying about 12 cents on the dollar in payments to insurers.

The plaintiffs allege they’ve been shortchanged and that the government must reimburse them full payments for 2014. The Department of Justice (DOJ) argues the cases are premature because the full amount owed under the program is not due until 2016, after the program runs its course.

The Trump administration may surrender another ACA-linked challenge that questions billions in payments made to insurers, Mr. Jost said in an interview. In House v. Burwell, the House of Representatives accuses HHS of wrongly spending billions to repay insurers for health insurance provided to certain low-income patients under the ACA. The House claims HHS is illegally spending monies that Congress never appropriated. HHS argues that other statutory provisions of the ACA authorize expenditures for cost-sharing reimbursements. In May, the U.S. District Court for the District of Columbia decided in favor of the House, ruling that Congress never appropriated money for the payments and that no public money can be spent without an appropriation.

There is speculation that the Trump administration may not pursue an appeal, Mr. Jost said. “I think they better think long and hard about that because I don’t know why any president would want court precedent saying one house of Congress can sue the president whenever it disagrees,” he said. “If the Trump administration would give in on the lawsuit or the House would win … there would be some very large losses and some very large premium increases next year. There could be some very significant disruption of insurance markets.”

Again, if the ACA is repealed, the case may become irrelevant, Mr. Fader said. “If you get rid of the ACA and eliminate the cost sharing structure, than House v. Burwell is going to just be moot.”

Weaker enforcement of antitrust regulations in health care also could be on the horizon, said William W. Horton, a Birmingham, Ala.–based health law attorney and past chair of the American Bar Association Health Law Section.

“We have seen a substantial uptick in antitrust enforcement activity in health care over the last several years,” he said in an interview. “The Trump administration has said that one of its themes is reducing the regulatory burden on businesses. People will be watching to see if that means an attempt to back off of some of the more-aggressive antitrust enforcement activities in health care and other industries.”

The Obama administration is currently fighting to block two mega-mergers among four of the largest health insurers in the nation. The DOJ filed legal challenges earlier this year seeking to ban Anthem’s proposed acquisition of Cigna and Aetna’s proposed acquisition of Humana. The lawsuits allege the mergers – valued at $54 billion and $37 billion respectively – would negatively affect doctors, patients, and employers by limiting price competition, reducing benefits, and lowering quality of care. A majority of physician associations and patient groups oppose the mergers. But experts said the new administration could drop the challenges.

Similarly, the Trump administration could be more lax in its enforcement of the Stark Law. “You could certainly say if the administration is committed to reducing regulatory burden, one thing the administration might push forward is reducing some of the enforcement with respect to technical violations of Stark,” Mr. Horton said, noting that the Senate recently questioned if the government is going too far in regulating physician relationships under Stark. “If your theme is ‘Let’s cut back on regulation,’ that would be an area that you would think the administration would look at.”

Meanwhile, stronger medical malpractice reforms could be on the horizon in light of a Republican-controlled Congress. Tort reform advocates have a good chance at passing federal medical liability reforms that were left out of the ACA’s passage in 2010, said Dennis A. Cardoza, public affairs director and cochair of the federal public affairs practice at a national health law firm.

Earlier versions of the ACA included amendments that mandated lawsuits go through a state or federal alternative dispute resolution system prior to being filed in court. Another provision that failed would have provided federal grants to states that created special health courts for medical malpractice claims. The amendment would have allowed states to create expert panels, administrative health care tribunals, or a combination of the two.

“There’s much stronger support for tort reform among the Republicans in Congress,” Mr. Cardoza said in an interview. “There’s a shot [now]. If the reforms don’t go too far where they would penalize injured patients, I think they could get additional support and be well received by the Congress.”

Tougher abortion restrictions are likely under the Trump administration, experts said. President-elect Trump has said he is committed to nominating a ninth Supreme Court justice who opposes Roe v. Wade.

“The new justice is almost certain to swing the court in a conservative direction,” said Rep-elect Jamie Raskin (D-Md.), a constitutional law professor at American University in Washington. “The stakes are extremely high in the health care field as in every part of Supreme Court jurisprudence.”

Vice President-elect Mike Pence, who is considered a strong voice for the religious right, will likely influence who Mr. Trump nominates for the high court, said Rep-elect Raskin, who added that if ever there was time that abortion rights are in jeopardy, it’s now.

“This really puts the Republicans to the test,” he said in an interview. “For decades now, they have been calling for the overruling of Roe v. Wade. The religious right will never forgive them if it doesn’t happen now. [Republicans] control the House, the Senate, and the White House. They have it within their reach to create a five-justice majority on the court.”

gtwachtman@frontlinemedcom.com
agallegos@frontlinemedcom.com
On Twitter @legal_med
 

Look for three things from the Trump administration: significant changes to the Affordable Care Act, few changes to MACRA’s Quality Payment Program, and a conservative swing in the courts.

Republicans have had their sights on the Affordable Care Act since its passage in 2010; with majorities in both the House and the Senate, the question is not if, but when President Obama’s signature piece of legislation will be dismantled.

President-elect Donald Trump ran on the promise of ACA repeal. Health policy priorities on his transition website focus on greater use of health savings accounts, the ability to purchase insurance across state lines, and the reestablishment of high-risk pools.

Health policy experts differ in how they see ACA reform coming about, with some predicting a quick repeal coupled with an immediate legislative replacement, while others envision repeal with more time to craft replacement legislation. Reform also could come as a series of smaller bills rather than one comprehensive package.

“I do think that [the new administration is] going to deliver on the repeal provision early on, but it is also likely to come with a bridge so that people are not thrown off their coverage,” Grace-Marie Turner, founder and president of the Galen Institute, said in an interview. She noted that one of the last ACA repeal efforts by congressional Republicans used the budget reconciliation process and included a 2-year transition period to spare 20 million people from losing their coverage while replacement legislation makes its way through Congress.

Using budget reconciliation would not allow for full ACA repeal since only provisions that involve revenue generation or spending could be altered. However, since budget reconciliation bills cannot be filibustered, only a simple majority is needed for Senate passage. With their razor-thin majority – 51 seats – Republicans will need some support from outside of their own party.

“Twenty-some Democrats, many in very-deep ‘red states’ including North Dakota, are up for reelection in 2018,” Ms. Turner said. “They saw what happened to the candidates who supported Obamacare in 2016 – many of them went down. It happened with Evan Bayh in Indiana, who was running again to reclaim the Senate seat he left in 2010. And the Republican candidate [Todd Young] reminded the voters over and over that Evan Bayh voted for Obamacare. Same thing happened in Wisconsin with [Republican] Sen. Ron Johnson being challenged by Russ Feingold, who also was in the Senate when Obamacare passed. Feingold went down to defeat again. I think the lot of Democratic senators are going to be looking at what happened to those people and think ‘Maybe I better participate in coming up with a more sensible solution.’ ”

More importantly, the GOP may be looking for bipartisan support, especially since the ACA passed on a strict party-line vote. To that end, it could make more sense to delay reform efforts until a broader coalition can be formed and simultaneous repeal/replace package could be brought to both the House and the Senate floors.

“Honestly, I think it would be better if they delayed the repeal vote,” Gail Wilensky, PhD, senior fellow at Project HOPE, said in an interview. “It would be better in terms of the political dynamics of maybe being able to get possibly some Democratic support for the replacement legislation, which I think will be impossible to get if they do the repeal as a standalone.”

In the new Congress, Senate Republicans might face some of the same obstructionist tactics they used during the Obama administration, which could complicate efforts to get bipartisan support.

“When you have people like Sen. [Bernie] Sanders (I-Vt.) and Sen. [Elizabeth] Warren (D-Mass.) saying they are going to adapt a scorched earth approach going forward, they and their followers don’t have any intention of doing anything that would in any way appear to cooperate with the Republicans,” Dr. Wilensky said. “Of course, there are other Democrats, especially some of the ones who will be up in 2018, who might not be quite so adamant.”

ACA repeal without immediate replacement could wreak havoc in the health care insurance marketplace, according to Sara R. Collins, PhD, vice president of health care coverage and access at the Commonwealth Fund.

“Repeal without a clear idea of what the replacement would be would really throw that market into chaos, where right now we are at a place where the markets are relatively stable,” Dr. Collins said in an interview.“The best way to think about the ACA, and particularly on the marketplaces and what repeal means, is this image of the three-legged stool. The individual market is the seat and the legs include consumer protections, particularly guaranteed issue; the individual requirement to have insurance; and the subsidies to make that coverage affordable – Medicaid expansion is part of that as well. If you start to remove any one of those legs, the market becomes extremely unstable.”

Repealing the individual mandate is problematic as it goes hand in hand with the ban on coverage denial because of preexisting conditions, something President-elect Trump has signaled he is looking to maintain, Ms. Turner said, adding that free market solutions with appropriate incentives could be a different way to encourage healthy people to get coverage to help generate premium revenue to cover patients with preexisting conditions.

While the ACA will be in the crosshairs, experts expect MACRA to remain more or less intact, maybe with some minor tweaks, at least early on.

While the Medicare Access and CHIP Reauthorization Act of 2015 passed with overwhelming support from both parties, “the [implementing regulations] are just a nightmare and I think the Trump administration is going to have to take a look at them,” Ms. Turner said. She added that physicians are weary of the ever-growing federal administrative hassles. “You do not want doctors to leave private practice in droves, and they are looking at this cost of compliance.”

“I think that [MACRA] is just way too much of an in-the-weeds policy thing for the Trump administration to have addressed yet,” Ms. Turner continued. “But this certainly is going to have to be on the agenda because they are going to hear from a lot of doctors that this is not acceptable.”

“The question is how much gain and pain is there in uprooting something that has its own built-in momentum, even though people in the midst of that will complain about aspects and want adjustments,” Thomas P. Miller, resident fellow at the American Enterprise Institute, said in an interview.

Mr. Trump also has called for Medicaid reform, with block grants to the states.

“Everyone keeps talking about a block grant, but that is a clumsy way of doing it,” Ms. Turner said, suggesting the program be even more refined to cover people in different baskets, including dual-eligibles, healthy adults that were part of the ACA Medicaid expansion, mothers and infants, and disabled individuals. “A capitated allotment [allows the government to provide more support to] the people who need it.”

Dr. Wilensky suggested that the Trump administration could revisit the 1332 waiver process, another provision of the ACA.

“The current administration has taken a very-rigid view on that you have to keep savings from Medicaid and the ACA separate and any changes have to be budget neutral to each, which is an extremely rigid set of requirements,” she said. Instead “Medicaid and ACA savings could count together and it just needs to be budget neutral over a 3- or 5-year period. That would then allow states to come in and request a lot of flexibility that the current administration hasn’t been inclined to give them.”

Likewise, the Children’s Health Insurance Plan (CHIP) is up for reauthorization. While the program remains relatively popular, it could be due for some reforms as well. Dr. Wilensky said it might be time for the program to go away, though doing that would face resistance from congressional Democrats.

Likewise, Ms. Turner suggested it could be time to fold CHIP into another program like Medicaid.

“Does it really make sense for a mother who is overwhelmed, maybe even with two jobs, to have her kids on a different health insurance program than she’s on?” Ms. Turner said. “It just adds to the burden and the paperwork. Would it make more sense to blend some of these programs together, making sure the people get the health coverage they need, but without all these artificial silos that really make it much more difficult for the user at the other end. I think they are going to take a look at that.”

Whether the ACA is amended or repealed may affect some – but not all – of the ACA-related cases lingering in the courts.

Zubik v. Burwell for instance, may become irrelevant if President-elect Trump eliminates the ACA’s birth control mandate or its accommodation clause. Zubik centers on an exception to the birth control mandate for organizations that oppose coverage for contraceptives but are not exempted entities, such as churches. The plaintiffs argue that the government’s opt-out process makes them complicit in offering contraception coverage indirectly.

The Trump administration could choose to broaden the mandate’s exemption to include the religious organizations, thus satisfying the plaintiffs, said Timothy S. Jost, a health law professor at Washington and Lee University in Lexington, Va., who added that the case would become moot if the ACA is repealed wholesale.

“Millions of women [currently] get access to birth control without cost sharing through the Affordable Care Act,” he said in an interview. “That’s an issue [the new administration] is going to have to confront.”

In March, U.S. Supreme Court justices requested that both sides provide new briefs that outlined how contraception could be provided without requiring notice on the part of the suing employers. Then, in light of the briefs, the high court vacated the lower court rulings related to Zubik and remanded the case to the four appeals courts that had originally ruled on the issue.

If the case makes its way back to the Supreme Court, the ultimate ruling will largely depend on the makeup of the court at the time, said Eric D. Fader, a New York–based health law attorney.

“As long as we have a 4-4 Supreme Court, everything is up in the air,” Mr. Fader said in an interview. “As soon as that ninth slot is filled, I think we’re going to see some decisions that are going to be in line with traditional Republican conservative positions.”

However, a set of ACA-related cases that involve payments to insurers will continue litigating, regardless of actions by the new administration, analysts said. A half-dozen health insurers have sued the Health & Human Services department over alleged underpayments under the ACA’s risk corridor program.

 

“Even if you do away with the ACA, these cases all pertain to conduct that has already occurred, so they’re not going to be automatically moot,” Mr. Fader said in an interview. “They may struggle along for a while.”

The cases stem from the ACA’s risk corridor program, which requires HHS to collect funds from excessively profitable insurers that offer qualified health plans under the exchanges, while paying out funds to QHP insurers that have excessive losses. Collections from profitable insurers under the program fell short in 2014 and again in 2015, resulting in HHS paying about 12 cents on the dollar in payments to insurers.

The plaintiffs allege they’ve been shortchanged and that the government must reimburse them full payments for 2014. The Department of Justice (DOJ) argues the cases are premature because the full amount owed under the program is not due until 2016, after the program runs its course.

The Trump administration may surrender another ACA-linked challenge that questions billions in payments made to insurers, Mr. Jost said in an interview. In House v. Burwell, the House of Representatives accuses HHS of wrongly spending billions to repay insurers for health insurance provided to certain low-income patients under the ACA. The House claims HHS is illegally spending monies that Congress never appropriated. HHS argues that other statutory provisions of the ACA authorize expenditures for cost-sharing reimbursements. In May, the U.S. District Court for the District of Columbia decided in favor of the House, ruling that Congress never appropriated money for the payments and that no public money can be spent without an appropriation.

There is speculation that the Trump administration may not pursue an appeal, Mr. Jost said. “I think they better think long and hard about that because I don’t know why any president would want court precedent saying one house of Congress can sue the president whenever it disagrees,” he said. “If the Trump administration would give in on the lawsuit or the House would win … there would be some very large losses and some very large premium increases next year. There could be some very significant disruption of insurance markets.”

Again, if the ACA is repealed, the case may become irrelevant, Mr. Fader said. “If you get rid of the ACA and eliminate the cost sharing structure, than House v. Burwell is going to just be moot.”

Weaker enforcement of antitrust regulations in health care also could be on the horizon, said William W. Horton, a Birmingham, Ala.–based health law attorney and past chair of the American Bar Association Health Law Section.

“We have seen a substantial uptick in antitrust enforcement activity in health care over the last several years,” he said in an interview. “The Trump administration has said that one of its themes is reducing the regulatory burden on businesses. People will be watching to see if that means an attempt to back off of some of the more-aggressive antitrust enforcement activities in health care and other industries.”

The Obama administration is currently fighting to block two mega-mergers among four of the largest health insurers in the nation. The DOJ filed legal challenges earlier this year seeking to ban Anthem’s proposed acquisition of Cigna and Aetna’s proposed acquisition of Humana. The lawsuits allege the mergers – valued at $54 billion and $37 billion respectively – would negatively affect doctors, patients, and employers by limiting price competition, reducing benefits, and lowering quality of care. A majority of physician associations and patient groups oppose the mergers. But experts said the new administration could drop the challenges.

Similarly, the Trump administration could be more lax in its enforcement of the Stark Law. “You could certainly say if the administration is committed to reducing regulatory burden, one thing the administration might push forward is reducing some of the enforcement with respect to technical violations of Stark,” Mr. Horton said, noting that the Senate recently questioned if the government is going too far in regulating physician relationships under Stark. “If your theme is ‘Let’s cut back on regulation,’ that would be an area that you would think the administration would look at.”

Meanwhile, stronger medical malpractice reforms could be on the horizon in light of a Republican-controlled Congress. Tort reform advocates have a good chance at passing federal medical liability reforms that were left out of the ACA’s passage in 2010, said Dennis A. Cardoza, public affairs director and cochair of the federal public affairs practice at a national health law firm.

Earlier versions of the ACA included amendments that mandated lawsuits go through a state or federal alternative dispute resolution system prior to being filed in court. Another provision that failed would have provided federal grants to states that created special health courts for medical malpractice claims. The amendment would have allowed states to create expert panels, administrative health care tribunals, or a combination of the two.

“There’s much stronger support for tort reform among the Republicans in Congress,” Mr. Cardoza said in an interview. “There’s a shot [now]. If the reforms don’t go too far where they would penalize injured patients, I think they could get additional support and be well received by the Congress.”

Tougher abortion restrictions are likely under the Trump administration, experts said. President-elect Trump has said he is committed to nominating a ninth Supreme Court justice who opposes Roe v. Wade.

“The new justice is almost certain to swing the court in a conservative direction,” said Rep-elect Jamie Raskin (D-Md.), a constitutional law professor at American University in Washington. “The stakes are extremely high in the health care field as in every part of Supreme Court jurisprudence.”

Vice President-elect Mike Pence, who is considered a strong voice for the religious right, will likely influence who Mr. Trump nominates for the high court, said Rep-elect Raskin, who added that if ever there was time that abortion rights are in jeopardy, it’s now.

“This really puts the Republicans to the test,” he said in an interview. “For decades now, they have been calling for the overruling of Roe v. Wade. The religious right will never forgive them if it doesn’t happen now. [Republicans] control the House, the Senate, and the White House. They have it within their reach to create a five-justice majority on the court.”

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