What ‘Trumpcare’ will look like
Donald Trump’s election has placed Obamacare on the gallows, as the candidate has repeatedly vowed to repeal and replace it.
The precise plans for its execution are unclear. Republicans may not be able to fully repeal Obamacare, lacking a 60-senator majority. However, President-elect Trump and Congress could gut his predecessor’s major project using a budgetary process called reconciliation. As Georgetown professor of health policy Jack Hoadley told NPR, “They are probably, practically speaking, talking about leaving the ACA, as is, in place.”
Leaving it in place in some fashion could allow Trump to hijack the Affordable Care Act and use it to host his own plans. As he said continuously in his campaign, he does not support the mandate that requires everyone to have health insurance. In Trump’s view, that should be a choice. (Proponents of the mandate say making insurance a choice would result in people who only buy it when they’re sick, making it extremely expensive.)
If key parts of Obamacare were gutted, 21 million people, many of whom are low-income, would likely lose their insurance, unable to pay for it without subsidies. This would double the number of uninsured Americans, according to the Committee for a Responsible Federal Budget.
It would also make for some bad publicity, so shutting off the faucet immediately isn’t likely.
Details of the actual plan are scant. But under “Trumpcare,” you would purchase your healthcare on the open market, which would be opened up further, allowing insurance companies to sell plans across state lines. Trump has said this will increase competition, and the premiums would be completely tax deductible.
The main part of Trump’s vision is the use of health savings accounts, or HSAs. Essentially, you pay for your medical expenses with your savings—if you have them. According to the Trump platform, this is advantageous for young people who may not have many health expenses and can choose high-deductible healthcare. His plan would let consumers spend HSA money on family members and pass the funds onto children.
According to the CRFB analysis, dismantling Obamacare’s major features—whether this is an actual “repeal” or not—and implementing Trump’s plan would cost $550 billion, increasing the deficit in the long run. It would also only cover 5% of the 21 million that would lose their Obamacare insurance.
The other element of Trumpcare is a restructuring of Medicaid, giving each state a block grant to divvy up as it chooses. (Obama, for his part, expanded Medicaid massively to cover low-income people in states that opted-in.) Doing this and keeping the grants from increasing with inflation and prices could be an interesting way to square Trumpcare’s cost. “If Mr. Trump intends to generate aggressive savings from block granting Medicaid, it could more than pay for the cost of repealing and replacing Obamacare,” the CRFB wrote, “though perhaps at the cost of a further reduction in coverage.”
As for keeping people with pre-existing conditions insured—something Republicans don’t often support—Trump did indicate in the Feb. 25 primary debate that he would like to keep that part of Obamacare in play.
For the most part, the other factors of his health plan are hard to quantify: adding price transparency for drug companies and healthcare providers, and intense negotiating. As of now, if Obamacare or key features are in fact repealed, we have nothing more than a very murky picture of what might replace it.
Update 11/11/2016: Trump said he is willing to keep a few parts of Obamacare: preventing insurance companies from denying coverage to people with prexisting conditions and allowing young people under the age of 26 to stay on their parents plans.
Ethan Wolff-Mann is a writer at Yahoo Finance focusing on consumerism, tech, and personal finance. Follow him on Twitter @ewolffmann.
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