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Is Obamacare’s Repeal the Health Care Reform We Need?

Health Letter, February 2017

By Azza AbuDagga, M.H.A., Ph.D.

The results of the recent presidential election reflect deep divisions in the U.S. on many fronts, and health care is no exception. While outgoing President Barack Obama, backed by the Democratic Party, made Obamacare (also known as the Affordable Care Act) his signature policy accomplishment, President Donald Trump and fellow Republicans have vowed to repeal, without offering a viable replacement, this most significant American health system reform since the creation of Medicare and Medicaid in 1965.

As President Trump and Republicans in Congress recklessly rush headlong to fulfill their vows to immediately repeal Obamacare and the Democrats mull strategies for fighting back, it would help to step away from the partisan strife and take an objective look at the options for ensuring affordable health care for all Americans.


Obamacare significantly increased health insurance coverage by, among other things, expanding Medicaid; establishing health insurance marketplaces where individuals, including those with pre-existing conditions, can purchase health insurance; subsidizing coverage for individuals with incomes below certain levels; and guaranteeing coverage for young adults under their parents’ insurance plans until age 26.[1],[2]

In an article published in the Journal of the American Medical Association in August 2016, Obama credited the reforms of his law for providing health insurance to 20 million individuals who were not insured before the law, reducing the uninsured rate from 16 percent to 9 percent. In addition, the number of non-elderly whose families struggled to pay medical bills fell by nearly 23 percent (from approximately 57 million in 2011 to approximately 44 million in the first half of 2016), according to a recent report from the National Center for Health Statistics.[3] Due to Obamacare’s numerous changes to Medicare payment rules and rates, the growth in spending per beneficiary has slowed.[4] In the employer-sponsored insurance market, where the majority of Americans get their insurance, premium growth slowed after Obamacare took effect.[5]

Obamacare has its share of shortcomings. Twenty-nine million Americans,[6] including 3 million children,[7] remain uninsured. Even among those with some form of health insurance, access to health care continues to be limited for many Americans, including 17 million children.[8] Furthermore, the insurance marketplaces created under Obamacare have suffered from double-digit premium increases and withdrawals by some major insurers, threatening the marketplaces’ sustainability.[9] Notably, Obamacare has not moved the U.S. above its long-standing position of last place among industrialized countries in both affordability of and access to health care.[10]

These limitations signal a need for further health care reform, as acknowledged by Obama.

Trump’s plan

Despite Trump’s adamant stance against Obamacare, his own health care reform plan has been sketchy all along. Some reports indicate that Trump plans to retain some of Obamacare’s most popular features, such as coverage for young adults under their parents’ plans until age 26 and coverage for pre-existing conditions.[11] Yet Trump’s website does not mention this. Instead, it outlines seven brief points regarding his health care reform plan, the first of which is to dismantle Obamacare.[12] He recently promised that everyone would be covered under his undisclosed plan, but did not explain how this would be accomplished.[13]

In lieu of Medicaid expansion, Trump plans to provide block grants to finance state Medicaid programs. Whether these grants would be large enough to guarantee continued coverage for the millions who obtained coverage through Obamacare’s Medicaid expansion in the 32 participating states[14] is not clear from the website.

Instead of maintaining the insurance exchanges, where individuals can purchase health insurance regardless of health status with financial assistance if they qualify, Trump plans to provide tax deductions for private health insurance premiums and will promote the use of health savings accounts (HSAs). However, the proposed premium tax deductions would do little to help low-income Americans who cannot afford health insurance premiums without financial assistance. In addition, HSAs alone are not a direct substitute for coverage, but are typically used with high-deductible insurance plans to reduce out-of-pocket costs.

Trump also plans to allow insurers licensed in one state to sell coverage in other states, as a strategy to promote competition among health plans. However, this approach would not guarantee increased coverage; instead, it follows previous Republican proposals that would allow insurers to focus on whatever states have the most lenient regulations,[15] encouraging a race to the bottom among insurers.[16]

These policies would not be enough to restore the health insurance coverage that an Obamacare repeal would take away from millions of Americans.

Projections by researchers from The Commonwealth Fund, a private U.S. research foundation, estimated that Trump’s health reform policies would increase the number of uninsured Americans by 16-25 million.[17] These projections indicate that coverage losses would disproportionately affect low-income individuals and those in poor health, and that enrollees with individual market insurance would face higher out-of-pocket spending than under Obamacare. The nonpartisan Congressional Budget Office (CBO) estimated that repealing Obamacare would increase direct federal spending by $879 billion over 10 years, mostly because of changes in spending for Medicare. Overall, the federal deficit would increase by $137 billion to $353 billion over 10 years if Obamacare is repealed, according to CBO estimates.[18]

A single-payer system

Despite its accomplishments, Obamacare failed to make health care accessible for every man, woman and child in the country. It is unlikely that what we know so far of Trump’s health reform plans will move the country any closer to this goal. Only a public single-payer system that is predicated on health care as a right for everyone can do that.

Such a system would fold the management and financing of all government health insurance programs — including Medicare and Medicaid — as well as employer-sponsored and nongroup health insurance into a single well-designed system, eliminating inefficiencies and increasing health care access, quality and equity.

Physicians for a National Health Program (PNHP) offered a detailed proposal for a publicly financed national health care program, developed by nearly 40 prominent physicians and other experts and endorsed by over 2,500 other physicians.[19] Under this program, Americans would receive full coverage for all medically necessary services, including mental health, rehabilitation and dental care.

Importantly, there would be no copayments and deductibles associated with medically necessary services under this program, because imposing such costs on patients has been shown to limit access to vital medical care, reduce adherence to medications, and selectively burden the sick and the poor.

PNHP’s single-payer proposal would pay hospitals and other health care facilities global budgets to cover their operating costs, and would pay physicians and other health care professionals based on either a fee-for-service schedule or through salaries if they are employed by hospitals or health care systems. Such a reform would eliminate much of the administrative cost associated with patient billing, which can add up to $150 billion annually in hospital administration costs alone. These savings would instead be channeled into services that can improve patient care.

Additionally, this program would negotiate prices with drug companies and manufacturers of medical supplies directly, producing substantial savings. Although a federally funded national health program that provides insurance for all Americans does not appear to be on the table for Trump’s administration, 58 percent of adult Americans — 73 percent and 41 percent of Democrats and Republicans, respectively — favor replacing Obamacare with such a system, according to a 2016 Gallup poll.[20]

Therefore, if Trump wants to be true to his claims of “making America great again” in terms of health care, he should pursue a single-payer system — regardless of how politically difficult the option may sound. Any other reform would simply be not enough.


[1] Rudowitz R, Artiga S, Young K. What coverage and financing is at risk under a repeal of the ACA Medicaid expansion? The Kaiser Commission on Medicaid and the Uninsured. December 2016. http://files.kff.org/attachment/Issue-Brief-What-Coverage-and-Financing-is-at-Risk-Under-a-Repeal-of-the-ACA-Medicaid-Expansion. Accessed January 23, 2017.

[2] Obama B. United States health care reform. JAMA. 2016;316(5):525-532

[3] Cohen R, Schiller J. Problems paying medical bills among persons under age 65: Early release of estimates from the National Health Interview Survey, 2011–June 2016. November 2016. https://www.cdc.gov/nchs/data/nhis/earlyrelease/probs_paying_medical_bills_jan_2011_jun_2016.pdf. Accessed January 23, 2017.

[4] Obama B. United States health care reform. JAMA. 2016;316(5):525-532

[5] Collins SR, Radley DC, Gunja MZ, Beutel S. The slowdown in employer insurance cost growth: Why many workers still feel the pinch. The Commonwealth Fund. November 2016. http://www.commonwealthfund.org/~/media/files/publications/issue-brief/2016/oct/1910_collins_slowdown_employer_ins_cost_growth_ib.pdf. Accessed January 23, 2017.

[6] Woolhandler S, Himmelstein DU. The Obama years: Tepid palliation for America’s health scourges. Am J Public Health. 2017;107(1):22-24.

[7] Children’s Health Fund. Unfinished Business: More than 20 million children in U.S. still lack sufficient access to essential health care. November 2016. https://www.childrenshealthfund.org/wp-content/uploads/2016/11/Unfinished-Business-Final_.pdf.

[8] Ibid.

[9] Abelson R, Sanger-Katz M. Obamacare marketplaces are in trouble. What can be done? The New York Times. August 29, 2016. http://www.nytimes.com/2016/08/30/upshot/obamacare-marketplaces-are-in-trouble-what-can-be-done.html. Accessed January 23, 2017.

[10] Osborn R, Squires D, Doty M, et al. In new survey of 11 countries, U.S. adults still struggle with access to and affordability of health care. Heal Aff. 2016;35(12):2327-2336.

[11] Gostin L, Hyman D, Jacobson P. The Affordable Care Act: Moving forward in the coming years. JAMA. 2016;317(1):19-20.

[12] Trump/Pence Make America Great Again 2016. Healthcare reform to make America great again. https://www.donaldjtrump.com/positions/healthcare-reform. Accessed January 23, 2017.

[13] Costa R, Goldstein A. Trump vows ‘insurance for everybody’ in Obamacare replacement plan. The Washington Post. January 15, 2017. https://www.washingtonpost.com/politics/trump-vows-insurance-for-everybody-in-obamacare-replacement-plan/2017/01/15/5f2b1e18-db5d-11e6-ad42-f3375f271c9c_story.html?utm_term=.2c4cfd5f026b. Accessed January 23, 2017.

[14] Rudowitz R, Artiga S, Young K. What coverage and financing is at risk under a repeal of the ACA Medicaid expansion? The Kaiser Commission on Medicaid and the Uninsured. December 2016. http://files.kff.org/attachment/Issue-Brief-What-Coverage-and-Financing-is-at-Risk-Under-a-Repeal-of-the-ACA-Medicaid-Expansion. Accessed January 23, 2017.

[15] Sanger-Katz, M. The problem with G.O.P. plans to sell health insurance across state lines. New York Times. August 31, 2016.http://www.nytimes.com/2015/09/01/upshot/the-problem-with-gop-plans-to-sell-health-insurance-across-state-lines.html?_r=1. Accessed January 23, 2017.

[16] Glied SA, Frank RG. Care for the vulnerable vs. cash for the powerful — Trump’s pick for HHS. N Engl J Med. 2017;376(2):103-105.

[17] Saltzman E, Eibner C. Donald Trump’s health care reform proposals: Anticipated effects on insurance coverage, out-of-pocket costs, and the federal deficit. The Commonwealth Fund. September 2016. http://www.commonwealthfund.org/publications/issue-briefs/2016/sep/trump-presidential-health-care-proposal. Accessed January 23, 2017.

[18] Congressional Budget Office. Budgetary and economic effects of repealing the Affordable Care Act. June 2015. https://www.cbo.gov/sites/default/files/114th-congress-2015-2016/reports/50252-Effects_of_ACA_Repeal.pdf. Accessed January 23, 2017.

[19] Gaffney A, Himmelstein D, Woolhandler S, Angell M. Beyond the Affordable Care Act: A physicians’ proposal for single-payer health care reform. 2016. http://www.pnhp.org/beyond_aca/Physicians_Proposal.pdf. Accessed January 23, 2017.

[20] Newport F. Majority in U.S. support idea of fed-funded healthcare system. Gallup. May 16, 2016. http://www.gallup.com/poll/191504/majority-support-idea-fed-funded-healthcare-system.aspx. Accessed January 23, 2017.