Lanhee J. Chen is a research fellow at the Hoover Institution and director of domestic policy studies in the public policy program at Stanford University. Tevi Troy is a former deputy secretary of health and human services and author of “Shall We Wake the President?: Two Centuries of Disaster Management From the Oval Office.”
The failure of Senate Republicans to pass even their “skinny” repeal bill is a serious disappointment to critics of the Affordable Care Act. Despite campaign rhetoric suggesting otherwise, “repeal and replace” of the ACA is something Republicans are apparently unable and likely unwilling to do. The only silver lining for conservatives is that the failure has demonstrated what the political market will bear when it comes to changes to the law.
Even if Republicans had succeeded in their recent efforts, skinny repeal would have come nowhere close to solving the problems that plague our health-care system, especially rising costs and declining choices. Of course, the ACA also failed to solve those problems and in many ways exacerbated them. Republicans — hopefully working with Democrats — should not give up on reform that would lower costs, improve quality and ensure more widespread adoption of exciting health-care innovations. The recent failed effort highlights what some of these reforms might be.
On the legislative front, there are several rifle-shot provisions that could be attached to must-pass pieces of legislation, such as continued funding for the Children’s Health Insurance Program. The Congressional Budget Office estimates that medical liability reform could save almost $50 billion over 10 years. And allowing the purchase of insurance across state lines would help expand insurance markets, consequently, improving options for consumers in states burdened by heavy insurance mandates. Republicans could also eliminate the Independent Payment Advisory Board, a government body that has drawn bipartisan criticism for the extraordinary power it has to make significant cuts to the Medicare program.
Beyond legislation, the Trump administration can improve the ACA through the regulatory process. As Health and Human Services Secretary Tom Price has said: “There are 1,442 citations in the Affordable Care Act where it says, ‘The Secretary shall . . .’ or ‘The Secretary may . . .’” That gives the administration significant flexibility to shape the law how it chooses. Price should use that authority to promote choice in insurance marketplaces, enhance innovations in state Medicaid programs and advance policies that help to lower premiums for more Americans.
On the Medicaid front, Republicans typically put a lot of faith in state innovation and the ability of federal authorities to work with governors to expand coverage and lower costs. Now, it is up to federal officials to make sure that these experiments lead to results. That means working with both Republican and Democratic governors to address continuing challenges around coverage and, more important, fiscal sustainability.
The Trump administration can also work with states that are interested in taking advantage of the innovation waivers in Section 1332 of the ACA, which allow states to fashion health reforms that suit their citizens best. The Obama administration placed significant constraints on what it would take for states to get these waiver requests approved. Trump could take a different course by issuing regulatory guidance that makes clear it is open to a wide variety of state-based approaches to lowering costs, expanding choices and ultimately increasing coverage.
Finally, the challenges of policymaking in the current environment highlight the need to go beyond government for solutions. The legislative experiences of the past decade — both the failed skinny reform and the ACA alike — have taught us that Congress is not the best medium for promoting innovation in health care. It is too bogged down in partisan politics and less concerned with evidence of what works to bring about real payment reform. Medicare and Medicaid should instead look to the private sector for innovations in care delivery.
Employer-sponsored plans, which cover the largest share of Americans, can provide guidance on customer satisfaction and the incorporation of new technologies, areas in which government-run plans are often lacking. Similarly, the Centers for Medicare & Medicaid Services usually sends signals to the private sector regarding which new therapies should be covered. We’d be better off if the government took signals from the private sector about what works.
Moving forward will be difficult, as recent congressional debate has shown. But the Senate’s failure should not mean the end of GOP efforts to improve health care. Already, progressives across the country — including Senate Minority Leader Charles E. Schumer (D-N.Y.) — are opening the door to a single-payer health-care system. If Republicans are unable to use the tools at their disposal, a government-run health-care system will move from being a liberal pipe dream to a realistic possibility.