What Price’s appointment means for employers

With Tom Price now confirmed to head the Department of Health and Human Services, the Affordable Care Act is sure to undergo many changes. And employer groups are urging the administration not to repeal the law without having a definitive and thoughtful replacement plan first — or else, industry experts say, they will surely be the ones who pay.

“It’s critical that the ACA not be repealed without a definitive plan for what will replace it. If we end up with more uninsured, the cost of their care will ultimately be covered by those who pay the bill: public and private employers,” says Mike Thompson, president and CEO, National Alliance of Healthcare Purchaser Coalitions.

The Senate on Friday confirmed Price, a congressman and physician, as the new HHS secretary, a post where he’ll have a leading role in Republican efforts to dismantle Obamacare and implement its replacement, in addition to overseeing a budget of more than $1 trillion.

Overall, industry experts say, the HHS confirmation indicates how serious President Trump — who signed an executive order on his first day in office calling for his agencies to work to reduce burdens of the Affordable Care Act — is about repealing former President Obama’s signature healthcare law.

The good news about the Price confirmation, Thompson says, is the potential for a “thoughtful relook” at healthcare reform. “We have an opportunity to look at how we do it,” he says, noting that employers and other key industry stakeholders can speak up to the administration about their thoughts on what a replacement should look like. “We hope this reboot on health policy will continue to support the move away from a reimbursement system that rewards volume and waste rather than value and outcomes.”

The new health reform conversation has to involve more than just access to healthcare; it must include a discussion about how to address healthcare costs, adds Brian Marcotte, president and CEO of the National Business Group on Health.

“If this is just a refocus on access — which is what the ACA primarily was — if it’s not going to delivery system transformation and value-based care, that’s a concern.”

Many expect the Trump administration to expand the use of health savings accounts. In 2015, as a congressman in Georgia, Price introduced legislation to replace the ACA that featured expanded use of HSAs, as well as tax credits to help people buy insurance on the private market and federal funds for states to create high-risk pools to cover the very sick and those with pre-existing conditions.

Still, industry experts say that although they expect Trump and Price to significantly alter the ACA, employers shouldn’t make big changes or throw out compliance plans just yet.

Though potential overhauls could mean a big change for employer strategy, a wait-and-see approach — again — is in order for employers, Thompson says. “Even if Trump and Price have a clear vision on where they want to go, there are a lot of key stakeholders that are going to weigh in over the next few years,” he says.

“It’s wait-and-see because until you see the devil in the details, it’s hard to react to anything other than the high-level banter about replacing and repealing,” Marcotte adds.

Other employer concerns

Though the ACA is top of mind with Price’s confirmation, employers are watching other issues as well — some with reservations. The biggest chunk of HHS’s budget goes to Medicare, the U.S. program for the elderly and disabled, with another large piece devoted to Medicaid.

Price’s selection, Marcotte says, “likely means that Medicare payment reforms will get a second look and may advance a little more slowly. And I think that concerns us a little. We would hope that HHS would continue to transform Medicare away from fee for service, which drives unnecessary care and spending, toward paying for value. And we’d like to keep our foot on the gas when it comes to transforming the delivery system and not lose momentum there. That’s the one bit of uncertainty.”

Another concern is just how Price’s bias against federal oversight and federal regulation may impact employers and their benefits plans.

“He’s very state-oriented,” Thompson says. “And with major employers, there’s a concern with this. [Changing federal oversight] can cause questions about how their healthcare is regulated, how their benefit plans might be influenced and how the dismantling of ACA plays into this. It could get replaced with 50 different versions of ACA, and that would be a concern.”

Finally, Thompson notes, “as more health policy decision-making is shifted to the states, it’s critical that ERISA preemption is preserved so self-insured national employers can continue to meet the healthcare needs for their workforce.”

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