The Election’s Impact On Healthcare: Some Bellwether Races To Watch
By Julie Rovner, Kaiser Health News Voters this year have told pollsters in no uncertain terms that health care is important to them. In particular, maintaining insurance protections for preexisting conditions is the top issue to many. But the results of the midterm elections are likely to have a major impact on a broad array of other health issues that touch every single American. And how those issues are addressed will depend in large part on which party controls the U.S. House and Senate, governors’ mansions and state legislatures around the country. All politics is local, and no single race is likely to determine national or even state action. But some key contests can provide something of a barometer of what’s likely to happen — or not happen — over the next two years. For example, keep an eye on Kansas. The razor-tight race for governor could determine whether the state expands Medicaid to all people with low incomes, as allowed under the Affordable Care Act. The legislature in that deep red state passed a bill to accept expansion in 2017, but it could not override the veto of then-Gov. Sam Brownback. Of the candidates running for governor in 2018, Democrat Laura Kelly supports expansion, while Republican Kris Kobach does not. Here are three big health issues that could be dramatically affected by Tuesday’s vote. 1. The Affordable Care Act Protections for preexisting conditions are only a small part of the ACA. The law also made big changes to Medicare and Medicaid, employer-provided health plans and the generic drug approval process, among other things. Republicans ran hard on promises to get rid of the law in every election since it passed in 2010. But when the GOP finally got control of the House, the Senate and the White House in 2017, Republicans found they could not reach agreement on how to “repeal and replace” the law. This year has Democrats on the attack over the votes Republicans took on various proposals to remake the health law. Probably the most endangered Democrat in the Senate, Heidi Heitkamp of North Dakota, has hammered her Republican opponent, U.S. Rep. Kevin Cramer, over his votes in the House for the unsuccessful repeal-and-replace bills. Cramer said that despite his votes he supports protections for preexisting conditions, but he has not said what he would do or get behind that could have that effect. Polls suggest Cramer has a healthy lead in that race, but if Heitkamp pulled off a surprise win, health care might well get some of the credit. And in New Jersey, Rep. Tom MacArthur, the moderate Republican who wrote the language that got the GOP health bill passed in the House in 2017, is in a heated race with Democrat Andy Kim, who has never held elective office. The overriding issue in that race, too, is health care. It is not just congressional action that has Republicans playing defense on the ACA. In February, 18 GOP attorneys general and two GOP governors filed a lawsuit seeking a judgment that the law is now unconstitutional because Congress in the 2017 tax bill repealed the penalty for not having insurance. Two of those attorneys general — Missouri’s Josh Hawley and West Virginia’s Patrick Morrisey — are running for the Senate. Both states overwhelmingly supported President Donald Trump in 2016. The attorneys general are running against Democratic incumbents — Claire McCaskill of Missouri and Joe Manchin of West Virginia. And both Republicans are being hotly criticized by their opponents for their participation in the lawsuit. Although Manchin appears to have taken a lead, the Hawley-McCaskill race is rated a toss-up by political analysts. But in the end, the fate of the ACA depends less on an individual race than on which party winds up in control of Congress. “If Democrats take the House … then any attempt at repeal-and-replace will be kaput,” said John McDonough, a former Democratic Senate aide who helped write the ACA and now teaches at the Harvard School of Public Health. Conservative healthcare strategist Chris Jacobs, who worked for Republicans on Capitol Hill, said a new repeal-and-replace effort might not happen even if Republicans are successful Tuesday. “Republicans, if they maintain the majority in the House, will have a margin of a half dozen seats — if they are lucky,” he said. That likely would not allow the party to push through another controversial effort to change the law. Currently, there are 42 more Republicans than Democrats in the House. Even so, the GOP barely got its health bill passed out of the House in 2017. And political strategists say that, when the dust clears after voting, the numbers in the Senate may not be much different so a change could be hard there too. Republicans, even with a small majority last year, could not pass a repeal bill there. 2. Medicaid expansion The Supreme Court in 2012 made optional the ACA’s expansion of Medicaid to cover all low-income Americans up to 138 percent of the poverty line ($16,753 for an individual in 2018). Most states have now expanded, particularly since the federal government is paying the vast majority of the cost: 94 percent in 2018, gradually dropping to 90 percent in 2020. Still, 17 states, all with GOP governors or state legislatures (or both), have yet to expand Medicaid. McDonough is confident that’s about to change. “I’m wondering if we’re on the cusp of a Medicaid wave,” he said. Four states — Nebraska, Idaho, Utah and Montana — have Medicaid expansion questions on their ballots. All but Montana have yet to expand the program. Montana’s question would eliminate the 2019 sunset date included in its expansion in 2016. But it will be interesting to watch results because the measure has run into big-pocketed opposition: the tobacco industry. The initiative would increase taxes on cigarettes and other tobacco products to fund the state’s increased Medicaid costs. In Idaho, the ballot measure is being embraced by a number of Republican leaders. GOP Gov.
Medicare Financial Outlook Worsens
Phil Galewitz, Kaiser Health News Medicare’s financial condition has taken a turn for the worse because of predicted higher hospital spending and lower tax revenues that fund the program, the federal government reported Tuesday. In its annual report to Congress, the Medicare board of trustees said the program’s hospital insurance trust fund could run out of money by 2026 — three years earlier than projected last year. A senior government official briefing reporters attributed the worsened outlook for Medicare to several factors that are reducing funding and increasing spending. He said the trustees projected lower wages for several years, which will mean lower payroll taxes, which help fund the program. The recent tax cut passed by Congress would also result in fewer Social Security taxes paid into the hospital trust fund, as some higher-income seniors pay taxes on their Social Security benefits. The aging population is also putting pressure on the program’s finances. In addition, he said moves by the Trump administration and the GOP-controlled Congress to kill two provisions of the Affordable Care Act are also harming Medicare’s future. Those were the repeal of the penalties for people who don’t have insurance and the repeal of an independent board charged with reining in spending if certain financial targets were reached. Marc Goldwein, senior vice president for the nonpartisan Committee for a Responsible Federal Budget, said it was not surprising to see the three-year shift in Medicare’s solvency since the trust fund operates on a narrow margin between revenue and expenses. He said the change to the ACA’s individual mandate penalties, which takes effect next year, is expected to lead to millions more people going without health insurance. That, in turn, will leave hospitals with higher rates of uncompensated care. Some of those expenses are covered by a special Medicare fund paid to hospitals with larger numbers of uninsured patients. The Medicare Part A hospital trust fund is financed mostly through payroll taxes. It helps pay hospital, home health services, nursing home and hospice costs. Medicare Part B premiums — which cover visits to physicians and other outpatient costs — should remain stable next year, the trustees said. About a quarter of Part B costs are paid for by beneficiary premiums with the rest from the federal budget. In a separate report, the government said that Social Security would be able to pay full benefits until 2034, the same estimate as last year. The Social Security Disability Insurance Trust Fund was projected to have sufficient funds until 2032, four years later than forecast last year. Treasury Secretary Steven Mnuchin downplayed any pending crisis, although he acknowledged Medicare faces many long-standing economic and demographic challenges. “Lackluster economic growth in previous years, coupled with an aging population, has contributed to projected shortages for both Social Security and Medicare,” he said in a statement. https://home.treasury.gov/news/press-releases/sm0404 Mnuchin vowed that the Trump administration’s efforts to cut taxes, ease federal regulations and improve trade deals would help both Medicare and Social Security survive over the long term. “Robust economic growth will help to ensure their lasting stability,” he said. Critics, however, doubt the economy will grow fast enough to fix Medicare. The top Democrat on the House Ways & Means Committee, Rep. Richard Neal (Mass.), blamed the Trump administration for Medicare’s deteriorating outlook. “Administration policies in President Trump’s first year have reduced the life of the Medicare trust fund by three years,” he said. “With their repeated efforts to sabotage the nation’s health care system, including their irresponsible tax law, congressional Republicans and President Trump are purposefully running Medicare into the ground.” Seema Verma, administrator of the Centers for Medicare & Medicaid Services, said in a statement the report should spur Congress to act on Trump’s budget plan to cut Medicare spending during the next decade, mostly by reducing payments to doctors, nursing homes and other providers. “These proposals, if enacted, would strengthen the integrity of the Medicare program,” she said. Breaking from tradition, none of the Medicare trustees — which include Mnuchin, Health and Human Services Secretary Alex Azar and Secretary of Labor Alexander Acosta — spoke to the press after releasing the report. A spokesman said they had “scheduling conflicts.” The Medicare trustees said the trust fund will be able to pay full benefits until 2026 but then it will gradually decline to be able to cover 78 percent of expenses in 2039. Medicare provides health coverage to more than 58 million people, including seniors and people with disabilities. It has added 7 million people since 2013. Total Medicare expenditures were $710 billion in 2017. Juliette Cubanksi, associate director of Kaiser Family Foundation’s Medicare Policy Program, cautioned that the report doesn’t mean Medicare is going bankrupt in the next decade but Part A will only be able to pay 91 percent of covered benefits starting in 2026. (KHN is an editorially independent program of the foundation.) She noted that Congress has never let the trust fund go bankrupt. In the early 1970s, the program came within two years of insolvency. But the 2026 estimate marks the closest the program has come to insolvency since 2009, the year before the Affordable Care Act was approved. Joe Baker, president of the Medicare Rights Center, said Congress still has plenty of time to act without making changes that harm beneficiaries. “I worry about fear mongering and the need to do something radical to the program,” he said. Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation which is not affiliated with Kaiser Permanente.