Assessing the healthcare debate, with Jacob Hacker

Republicans in the United States Senate sought this week to revive their party’s effort to dismantle the Affordable Care Act (ACA). President Donald Trump has pressured congressional Republicans to follow through on their much-repeated promise to “repeal and replace” the ACA — the Obama administration’s signature legislative achievement. 

Jacob Hacker, the Stanley B. Resor Professor of Political Science, is an expert on healthcare policy whose work was influential in crafting the ACA. Hacker, the director of Yale’s Institution for Social and Policy Studies, spoke with YaleNews about the current debate in Congress over health policy and his ideas for improving the nation’s healthcare system. An edited transcript follows:

What has struck you most about the Republican effort to overhaul the healthcare system?

I’m most struck by the degree to which the Republicans have been driven not by strategic thinking about healthcare policy, but by their larger goals of cutting back Medicaid and cutting taxes. Those two aims are inextricably linked because every dollar they take out of Medicaid is a dollar they can use to cut taxes, particularly taxes on corporations and the wealthy. The last version of the Senate bill would produce something like $400 billion in so-called deficit reduction, but the reason they’re not using that money to make the bill more palatable — to try to reduce the number of people losing coverage, for example — is because they want use it to pay for tax cuts for the rich.

It is not a particularly savvy legislative approach. If you look at previous efforts to fundamentally reform social policy in the United States or other countries, you see immediately that the key is finding ways to reduce opposition by distributing money and preserving benefits for some amount of time for key constituencies. The Republicans are so intent on getting these big savings, and frankly, so hostile to Medicaid, that they have been willing to put themselves in a very difficult position politically.

Has public opinion influenced the legislative process?

It’s hard to think of legislation that has garnered less public support than the Senate bill. Polls suggest that approval of the proposal falls somewhere between 10% and 20%, making it one of the least-popular pieces of legislation Congress has ever attempted to enact. The fact that it has a plausible path to passage is really telling about how little public opinion is driving the legislative process today. What really hampered the Republican effort was not that the bill was unpopular; it was that they couldn’t reach agreement within their own caucus. Perhaps most remarkable, it was that they couldn’t get the hardcore conservatives to agree to support this already very draconian legislation.

Almost everything that political scientists have written about American politics in the past few decades suggests that, first, public opinion matters a lot, and second, that in a big legislative fight, it’s the more centrist members of Congress who will decide things. In this case, public opinion was largely irrelevant. To the extent it mattered, it was the mobilization of people concerned about the bill. With regard to the more centrist members of the GOP caucus, they seemed much less important than the hardcore conservatives, who kept saying they would defect if the bill was made more appealing to the centrists.

All in all, I think we can say that the signs are not good for the Republicans’ attempt to pass something substantial, though the fight is certainly not over yet.

President Trump has suggested he would allow the ACA to fail should Congress fail to repeal it. What leverage does he have to make good on that pledge?

President Trump has signaled that he is going to make the Affordable Care Act collapse. It’s important to remember that the law is working reasonably well in much of the country, especially in the states that expanded Medicaid. It needs some important changes, just like any piece of major legislation, but it is certainly not in a death spiral.

The Trump administration has many opportunities to make the law more vulnerable and to further erode it. It could continue to fight efforts to fully fund the law. It could also work to undermine enrollment. The Obama administration put a lot of effort into advertising and outreach to get people to enroll. The Trump administration is doing the opposite. And there are concerns over whether the administration will support a number of provisions that both parties believe are necessary to stabilize the law, such as the cost-sharing subsidies that make coverage more affordable for lower-income enrollees.

The reality is that the administration and congressional Republicans will be held accountable if the law collapses. But they’re so committed to their stance that the law is failing and must be destroyed that they’re willing to take that risk.

If the repeal effort fails, what could be done to shore up the ACA?

The first and most important step is to ensure and encourage insurers’ participation in the exchanges. This includes supporting and strengthening provisions in the law related to protecting plans that enroll costly groups of patients — these are known as the three R’s: risk adjustment, reinsurance, and risk corridors. It would also mean supporting cost-sharing subsidies under the law that make health coverage more affordable to lower-income people. It would also make sense to increase the tax credits for insurance premiums. The law has come in under budget, so if you spent what was originally intended, you could put more money into tax credits for people to afford coverage.

If we were stepping up our ambitions, I would think about ways to persuade states that have not expanded Medicaid to do so, because lower-income residents of these states represent a large portion of the people who were promised coverage under the law but haven’t received it.

That’s probably not a goal that could attract bipartisan support at the moment, but some of the other provisions I mentioned could, particularly if the Trump administration accepted the ACA as the law of the land and didn’t try to undermine it.

Politics aside, what could be done to extend health coverage to more people?

I would argue that we should move toward the system I proposed in the 2000s, which provided the template for the more progressive versions of what became the Affordable Care Act. It’s worth remembering that President Obama initially supported a much more extensive and robust system and what emerged from the legislative process had been whittled down to something that could pass through the gauntlet of interest groups.

What did those more robust policies contain? They all had a public option — a health-insurance plan modeled after Medicare that would be available to anyone who is seeking coverage through the so-called health insurance exchanges. This would mean that anyone who didn’t have coverage through their employer would have access to a Medicare-like plan that offers a broad choice of physicians with reasonable rates and low administrative costs.

When I talk to Trump supporters about healthcare, which I do more often than you might think, they often say they oppose the ACA’s requirement that individuals obtain health insurance, but they would be fine with giving everyone access to Medicare. There are ways that Medicare can transcend the partisan divide because it is so familiar to people — their family members use it; it is simple and intuitive; and it gives people a choice between private and public plans.

Creating this more extensive system would require three things. First, you need to have Medicaid expansion in all the states. Second, employers either have to provide health insurance or help enroll workers in the new Medicare-like public plan. Finally, you should have this public insurance plan available nationwide.

If you did this, the only people who would lack health insurance would be those who fall through the cracks of Medicaid and have no ties to the workforce. That’s a fairly small population.

Is this politically feasible?

This can’t happen with Donald Trump in the White House. There would need to be a supportive president, and with the current configuration of the parties, that would mean a Democratic president. It would also require Democratic majorities in Congress. Even then, passing something like this wouldn’t be assured as we saw in the debate over the Affordable Care Act.

So we’d need a substantial political shift. That said, the big concern seven years ago was that all the interest groups would fight against a public option tooth and nail and that it wasn’t realistic to expect Americans to widely support it. I think the calculations have changed on both fronts. Doctors, hospitals, and insurance companies all oppose the Republican plan — the doctors and hospitals quite vocally. There are millions of Americans who lack coverage under the current system and aren’t paying insurance premiums. I think these interest groups could be brought to support a system that would guarantee that nearly everyone gets coverage. They certainly would show more support now than they did before the ACA was enacted.

More important, we’ve learned over the course of this debate that while Americans say they oppose Obamacare, they actually like most of its elements and have come to see government as having a central role in providing health insurance. That makes a Medicare-like public plan more viable.

Are you optimistic about the fate of the ACA?

I think we’re more likely to move in a progressive direction than a regressive one, especially if we get through the next few weeks without Republicans managing to pass significant legislation. It’s unlikely they’ll succeed, but it’s not impossible. I’ve been telling everyone that if they’re concerned about the Republicans’ proposals, they should contact their members of Congress, write letters to the editor, and talk to friends and family members, particularly those who live in states with Republican senators on the fence. This is as important as any debate we’ve had over healthcare and it’s still up in the air.