Think Tank

What Would ACA Repeal Mean for California?

If efforts to repeal all or part of the Affordable Care Act are successful — either in Congress or the Supreme Court — what happens next in California?

A couple of federal judges already have ruled against portions of the law. Most recently, a U.S. District Court judge in Florida ruled that the health reform law’s requirement that all individuals must have health insurance is unconstitutional. He also voided the entire law after concluding that the individual mandate is “inextricably bound” to other provisions in the law.

The issue appears headed to the Supreme Court.

Some reform proponents contend that doing away with the individual mandate may open the door to more progressive reform — such as single-payer plans.

We asked stakeholders and policymakers what might happen in California if part or all of the ACA is repealed.

If the Supreme Court upholds the individual mandate and the ACA remains intact, what does that mean for the future of single-payer efforts in California?

We got responses from:

Rejection of Reform Law Means Opportunity for Do-Over

Democrats and Republicans alike are anxiously waiting to see whether the health care reform law signed last year by President Obama survives its legal challenges. Last month a federal judge deemed the “lynchpin” component of the law — the individual mandate that requires everyone to purchase health care coverage — to be unconstitutional.  

Although California has “taken the lead” in advancing health care reform, which could cause the collapse of our entire health care delivery system, it is not too late for lawmakers and the governor to see the writing on the wall and seize the opportunity for a do-over.

Now is the time to embrace reforms to make health care more affordable and accessible. Adopting fiscally responsible reforms can improve the economy and reduce the number of uninsured, without growing government or raising taxes.

Jobs are leaving California because Sacramento has made it too expensive to create and retain them. This includes health care  Costly mandates and high taxes imposed by the Legislature have made health care more expensive for providers and employers.

Instead of nationalizing health care, why not move into the 21st century and give patients more affordable health care choices by allowing out-of-state health plans to sell their products across state lines in California?

Let’s allow Californians of all income levels to take advantage of personal health accounts, whereby individuals set aside money in tax-free accounts for health care. These contributions are often matched in whole or part by the employer. For those on a fixed income, charitable and taxpayer-subsidized contributions to a personal health account could replace our archaic Medi-Cal system. The key to reform is empowering patients to decide for themselves how to spend health care dollars.

But replacing the Affordable Care Act with a single-payer, or government-run, health care system is the wrong approach. Under government-run health care, visiting the doctor would be like visiting the DMV — long lines, higher costs and bureaucrats making health care decisions for you. This will mean higher taxes and fewer jobs.

Working families oppose government-run health care because they know it will hurt their wallets and the economy. It’s time Sacramento listens to the people for a change and works together to give Californians the affordable health care options they are seeking. Reforming health care the right way may be just the boost we need to get our economy back on track.

ACA Holds Much Promise, Should Be Upheld

Leaders of the California Academy of Family Physicians believe PPACA — including the individual mandate — should be upheld. The effects on individual and public health would be disastrous if the current 50 million uninsured Americans, including 6.8 million Californians, remained without health care coverage. Among our patients, those who cannot afford care delay seeking it until their health conditions have worsened and, even then, forgo many recommended tests and essential medications. This ultimately makes care even more expensive.

The needs that drove PPACA’s passage are critical. To name just a few: yhe number of uninsured is steadily increasing; Medicare is financially unsustainable unless we reform delivery and payment models; and the serious shortage of primary care physicians places the public’s health at great risk. PPACA addresses each of these issues; eliminating the law would put us back at square one.

If PPACA were voided, family physicians would join with our patients and others to enact new legislation that would survive judicial scrutiny. We would fight to restore much-needed reforms, including:

  • Patients’ rights to acquire health insurance regardless of pre-existing conditions;
  • Parents’ rights to include their children as young adults up to age 26 on their health care policies;
  • Patients’ rights to see more premium dollars go toward health care coverage (through improved medical-loss ratios), instead of insurance company profits;
  • Support for states to establish health insurance exchanges to make insurance more affordable and accessible;
  • Support for physician-led teams to keep people healthier in primary care-based patient-centered medical homes;
  • Support for piloting new payment and delivery models, including accountable care organizations.

PPACA has already brought positive changes; some would continue even if the law were eliminated. Debates that shaped reform motivated us to accelerate the move to evidence-based best practices for medical education, health care delivery and payment reform. Several new programs are in place and are already funded.

For example, the state Department of Health and Human Services last month designated and funded Modesto’s Valley Consortium for Medical Education as California’s first “teaching health center.” One of the main goals of the program is to address the primary care physician shortage. Led by a family medicine physician, this new residency program model places new physicians interested in rural medicine in outpatient settings in communities they want to serve, instead of in urban, hospital-based residency programs.

Regarding prospects for a single-payer system: Given that politics is the art of the possible, the single-payer model does not stand a chance in the current Congress. Let’s implement and protect the very promising PPACA reforms before assessing whether an entirely new approach is needed.

Single Payer Can Help Solve Retiree Benefits Problem

A repeal of the Affordable Care Act by any means is extremely unlikely. The current Congress will not repeal the act, and experts differ widely on what the Supreme Court will do. If it is not repealed anytime soon, California, like many other states, will continue to implement the federal legislation through new community health centers, health care work force expansion and health benefits exchanges. These programs strengthen community safety nets and, in fact, pave the way for quality, comprehensive health care to be delivered later as part of California’s single-payer system.

Members of Health Care for All — California (HCA) will continue to work hard on strengthening a statewide movement to pass legislation creating a universal single-payer health care plan. We feel buoyant and confident this year since key leaders in Sacramento have demonstrated in the past that they view universal health care as a public good. They know that a single-payer system can help to solve one large component of our fiscal crisis — the inordinate costs of employee and retiree health care benefit plans for state and local governments, as well as school districts.

Many California lawmakers also recognize single payer as the best controller of medical cost inflation. In 2004, a financial cost study prepared by the Lewin Group under contract with HCA showed $9 billion in savings to the state in payroll costs if the single-payer plan had been implemented in 2006.

We support single-payer legislation reform in every state, as well as at the federal level via Rep. John Conyers’ (D-Mich.) HR 676. In all likelihood, one or more states will implement a single-payer plan before it happens at a federal level. We hope California is one of those states, and we support single-payer reform in other states such as Vermont.

Single Payer: A Unifying Model for Health Reform

As unlikely as it may be for the Affordable Care Act to be repealed, there is no question that Republicans are bound and determined to undermine and ultimately collapse the most significant national health reform passed since the enactment of Medicare. If they are successful, Republicans, who themselves have access to government-provided health insurance coverage, will be responsible for preventing the health insurance coverage of up to 4.7 million Californians, nearly two-thirds of our state’s total number of uninsured residents.

Reforming America’s broken health care system is a delicate process of balancing our need to contain unsustainable costs with the universal human need of receiving medical care in times of illness. Health economists and policy experts know that America has enormous opportunity to get more accessible and higher quality health care from the billions of dollars that we already spend. This can only be achieved if we manage and spread the risk of illness and medical need among our population over the long term.

There are two ways of bringing everyone into the system in order to spread risk and manage health care costs. The simplest, most effective way to do this would be to build upon Medicare and implement a single-payer model of health care that covers everyone. In the interest of political feasibility, however, President Obama and other Democrats opted for an individual mandate, a Republican model that builds on the current commercial insurance system.

Now, with Republicans unwilling to give America’s president a political victory of any kind, they are opposing the very health reform policy they initially proposed.

If Republicans are successful at convincing the courts that the individual mandate was always unconstitutional, then they will have removed the only viable alternative to single-payer.

Our health care crisis isn’t going away. Physicians will continue to face declining reimbursements. Patients and employers will continue to struggle with steeply rising premiums and declining benefits, and quality of care will continue to erode. Without an individual mandate, single payer will be the only constitutionally sound alternative. It is likely to become our nation’s unifying model for health reform.