Election Wrap-Up and Potential Impact on Healthcare

Posted on 11/10/2016 by NTOCC ®

On Tuesday, Donald Trump won the presidency by running the most unconventional campaign in modern history. He was able to connect with middle-class voters in states like Pennsylvania, Wisconsin, Ohio and Iowa while winning toss-up states on the east coast, including Florida and North Carolina, to seal his victory. Thus far, President-elect Trump has won 28 states and 279 electoral votes, with Arizona (11 electoral votes), Michigan (16 electoral votes), and New Hampshire (4 electoral votes) yet to be called.

On Tuesday, Donald Trump won the presidency by running the most unconventional campaign in modern history. He was able to connect with middle-class voters in states like Pennsylvania, Wisconsin, Ohio and Iowa while winning toss-up states on the east coast, including Florida and North Carolina, to seal his victory. Thus far, President-elect Trump has won 28 states and 279 electoral votes, with Arizona (11 electoral votes), Michigan (16 electoral votes), and New Hampshire (4 electoral votes) yet to be called.

With the fate of the Presidency sealed, we can get to work assessing the potential impact on the end-of-year priorities as well as the first term of the new president. We must contend with a President-elect who has never held elected office and what will likely be a razor thin Republican Majority in the Senate. Paul Ryan will likely remain Speaker of the House after only losing between 5-7 seats in the House.

Most presidents put out goals for their first 100 days, thus we expect that we will begin to get a sense of President-elect Trump’s top agenda items within the coming weeks. We do know that he will likely move quickly to scale back many of President Obama’s regulations, including various rules implementing the Affordable Care Act.

 

The Lameduck

With so much focus on the presidential election, it’s easy to forget that lawmakers must still consider several legislative items before the new Congress is sworn in on January 3, 2017. The only critical, “must do” item for the lame duck Congress will be to fund the government past December 9th, when the current budget expires. In addition, Senate Majority Leader Mitch McConnell (R-KY) has indicated that he plans to move forward with 21st Century Cures.\

2017 Congressional Committee Outlook

House Energy and Commerce Committee: Current Chairman Fred Upton (R-MI) is term-limited and will step down as chair. Currently, Reps. Greg Walden (R-OR), John Shimkus (R-IL), and Joe Barton (R-TX) are in the running for the chairmanship. On the Democrat side, Rep. Frank Pallone (D-NJ) will likely remain ranking Member.

Health Subcommittee: Current Chairman Joe Pitts (R-PA) is retiring, which will give Rep. Brett Guthrie (R-KY, and current vice-chair) a chance for the chairmanship. However, there are more senior members who may seek to replace Pitts. Democrat Gene Green (D-TX) will likely remain ranking Member.

House Ways and Means Committee: Current Chairman Kevin Brady (R-TX) will retain the chairmanship. Rep. Pat Tiberi (R-OH) will retain chairmanship of the Health Subcommittee. Rep. Sander Levin (D-MI) will continue as Ranking Member of the full committee, but there is an open position for Ranking Member on the Health Subcommittee.

Senate HELP Committee: Other than Mark Kirk’s loss on the Republican side, and Sen. Barbara Mikulski’s (D-MD) retirement on the Democrat side the committee roster is unchanged, and Chairman Alexander is expected to continue his leadership role. Ranking Member Patty Murray (D-WA) has not confirmed whether she wants to be the Democrat whip; if she does, Bernie Sanders (D-VT) would be next in line to become HELP Ranking Member.

Senate Finance Committee: Chairman Orrin Hatch (R-UT) will retain his chairmanship with Sen. Ron Wyden (R-OR) continuing as Ranking Member.

 

The Cabinet: HHS Secretary

President-elect Trump’s transition team has begun composing a list of potential Cabinet-members; he is expected to pull heavily from the private sector for many of the top Cabinet positions. The Trump campaign has declined to confirm Cabinet positions, but the following are being reported widely as possibilities for Health and Human Services Secretary:

Former presidential candidate Ben Carson, Florida Governor Rick Scott, and Former House Speaker Newt Gingrich have all been floated as options. Carson has gotten the most attention for the position out of these three, with Trump stating: “I hope that he will be very much involved in my administration in the coming years.” A less likely option might be Rich Bagger, the executive Director of Trump’s transition team and pharmaceutical executive.

 

Likely Policy Initiatives

Repeal and Replacement of the ACA

President-elect Trump has repeatedly promised that the repeal and replacement of the Affordable Care Act will be one of his first policy priorities. During the campaign, he proposed a series of policies, such as promoting health savings accounts, allowing insurers to sell plans across state lines, giving tax breaks to people who buy insurance, and removing the mandate that insurance is required.

With Republicans retaining control of the House and Senate, the likelihood for a legislative repeal and replace option is high. Senate Majority Leader Mitch McConnell said yesterday, repealing Obamacare is a “pretty high item on our agenda.” However, Republicans only hold 51 seats in the Senate, short of the 60 seats needed to push legislation of this caliber through without using the reconciliation process. It’s likely that Senate Democrats would filibuster any attempt by Republicans to repeal the ACA through traditional legislation.

Even so, the ACA could be weakened and some parts of it eliminated by depriving funding. In addition, Congress could make individual changes to parts of the law, such as repealing the so-called “Cadillac tax” on certain plans, and dismantle it piece by piece. Some of these individual changes even have Democrat buy-in.

 

Changes to Value-based Payments

Many Republicans have expressed concern about how demonstration projects of value-based payments are implemented by HHS and CMS and scored by CBO. Many of these value-based payment projects were created through the ACA- if it is repealed, many of them might go away as well.

Even if the ACA, or parts of it, stay in place, the Republican controlled House and Senate may be unwilling to support additional moves from fee-for-service to pay-for-performance Medicare. For example, in September, 178 Members of the House signed a letter arguing that CMMI does not have the authority to require participation in value-based models. Given this climate, CMMI may be forced to slow down its demonstration projects, making them voluntary, or it could be dismantled altogether.