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Oct 27, 2017
Expert Voices

Alexander-Murray deal a flawed first attempt at bipartisanship

James Capretta

From our Expert Voices conversation on plans for health care reform after Trump's executive order:

Trump's executive order is unlikely to produce as much change as administration officials hope and ACA supporters fear.

  • Association Health Plans have a long and not-so-favorable history. The basic problem is that they are voluntary, which makes them unstable and risky. Even if the administration finds a legally viable way to make it easier for small businesses to form and join AHPs, most businesses will be wary of jumping into them because of the risk of failure.
  • The administration can make short-term, limited-duration insurance more widely available, but these policies will remain niche products with a small market potential.
  • The changes to Health Reimbursement Arrangements are too ambiguous to evaluate.

The ACA exchanges are suffering from adverse selection, but they will remain viable because the law's generous subsidies can only be used to pay for coverage bought through them. A new federal regulation cannot alter this reality either.

What's next: The Alexander-Murray compromise is a good first attempt at bipartisanship, but it is flawed. Democrats want to fund the cost-sharing reduction subsidies through 2019. If this plan is agreed to, Democrats will have no incentive to continue negotiating until after the 2018 midterms and the GOP would lose its opportunity to make more progress on health care.

Other voices in the conversation:

  • John McDonough, professor at the Harvard T.H. Chan School of Public Health and former Senate adviser on health reform: Obamacare is dead. Long live the Affordable Care Act.
  • Jeanne Lambrew, senior fellow at the Century Foundation and deputy assistant to the president for health policy in the Obama White House: Health care fix today could be undone tomorrow
  • Tevi Troy, CEO of the American Health Policy Institute and former deputy secretary of HHS: Expanding HRAs would bolster individual market
  • Christopher Condeluci, principal at CC Law and Policy and former tax and benefits counsel to the Senate Finance Committee: Clearing the air on AHPs
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