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Transitioning the ACA: Republicans Must Avoid Disruption

As we look ahead to the 115th Congress, Republicans are likely to take up repeal and replacement of the Affordable Care Act.  Repeal and replace is more accurately described as a transition where Republicans design a version of health care reform they will own and defend.  In doing so, Republicans must consider three important factors as they look at policy. The first, talking with the insurers, was discussed in a previous post.  The second is avoiding coverage disruption.  As Republicans begin the process of transition, they must avoid policies that will cause severe coverage disruption.

For example, Republicans strongly oppose the individual mandate in the Affordable Care Act.  The incoming Administration could order the IRS to create a number of “carve outs” for the individual mandate that would render it ineffective.  While that is a policy choice, the consequence likely would be insurers exiting the marketplace.  Without a mechanism to cause participation, the risk of adverse selection becomes unacceptably high—especially given the experience to date with the Affordable Care Act population.

Republicans do not want to cause millions of people to lose coverage, but, at the same time, they want to make significant changes in the policies of the Affordable Care Act.  Republicans are going to have to make structured policy decisions to minimize coverage disruptions.  After years of holding the Democrats responsible for their policy decisions, Republicans will now have to own the consequences of their policy decisions.

This post is the third in a series, with the first being published on Monday and the second being published on Tuesday.  In the posts that follow, we will describe additional critical issues that Republicans must tackle as they transition the Affordable Care Act and the impact of the new Congress and new administration on certain hot topics in health reform.

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