The 3 most likely next steps for the ACA

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Photo credit: Getty/Andrea Izzotti

As the 2016 election nears, presidential candidates are offering diverse views on healthcare, making it difficult to predict what will become of the Affordable Care Act.

Though new leaders will be elected in November, continued political stalemate surrounding the ACA will likely continue to be common practice, economist Stuart Butler, Ph.D., a senior fellow at the Brookings Institution, writes in an article for the Journal of American Medical Association Forum. But, he notes, there are some constructive changes that have a chance of passing.

As it stands now, there is widespread desire to enroll younger, healthier consumers on the public exchanges. Left-leaning senators have stepped up support for the public option, while GOP lawmakers introduced "emergency" legislation to help people who have been impacted by insurer exits buy coverage outside of the exchanges.

Once new politicians are in office, here are three possible changes that the ACA could undergo with bipartisan support, according to Butler:

  • A loosening of restrictions of age-related premium laws. Insurers currently cannot sell nongroup coverage to people ages 64 or older for more than three times the cost of the same coverage sold to a 21-year-old. Higher premiums resulting from this rule have pushed young people out of the market, leading to adverse selection, according to Butler. Speaker Paul Ryan, he says, has introduced legislation to provide tax credits to young people to make plans more affordable. Given President Barack Obama’s desire to enroll more young people as well, this could be an area that gains bipartisan support.
  • Increased use of Section 1332 of the ACA. Republicans see this statute as an “exit ramp” to sidestep many ACA requirements with a privatized Medicaid system, notes Butler, while Democrats, as FierceHealthPayer has reported, could use it as an avenue to enact a public option. So far, the White House has effectively "discouraged" use of the state innovation waivers, Butler notes, by narrowly interpreting budget neutrality. The next administration, he says, is likely to offer more clear support of the 1332 waivers.
  • Diluting or repealing the Cadillac tax. The 40 percent excise tax on high-cost employer-sponsored health plans is unpopular in Congress, writes Butler, though supported by some economists. Butler expects the tax to be further delayed not but repealed, noting that delay is "more attractive" for lawmakers, since it permits projected government revenues to be counted as offsetting the cost of the ACA or as a reduction in projected federal deficits.