Medicaid, ACA most likely to be impacted in Trump administration, panel says

The health care sector represents one-fifth of the U.S. economy, and the federal government regulates much of it. What will a second Trump term mean for health care? A panel of industry observers discussed potential changes during a webinar by the University of Southern California School of Journalism.

Medicaid and the Affordable Care Act enhanced premium tax credits are two health care issues that are most likely to be impacted by a new administration, the panelists said.

Many in Washington expect to see imposing Medicaid work requirements for able-bodied adults who receive coverage through the program, said Dan Diamond, Washington Post national health care reporter. Imposing work requirements could come from an act of Congress as congressional Republicans seek ways to offset revenue lost by extending individual tax cuts. Or the Centers for Medicare and Medicaid Services could give individual states permission to impose work requirements. Imposing work requirements on Medicaid recipients could result in 600,000 people losing coverage, he said.

ACA tax credits are a crucial factor in getting people enrolled in marketplace coverage, said Sara Owermohle, Washington correspondent for STAT. The Inflation Reduction Act of 2022 extended ACA enhanced premium tax credits for three years but they will expire next year unless Congress acts.

“Those subsidies were a big part of millions of people getting enrolled in ACA coverage,” she said.  A total of 45 million Americans are enrolled in coverage related to the ACA, the highest total on record.  This represents 14.1 million more people enrolled than in 2021 (a 46% increase) and 32.5 million more people enrolled than in 2014 (a 258% increase, or more than triple).

Owermohle cautioned that Vice President-elect JD Vance campaigned on the concept of dividing Americans who have ACA coverage into two risk pools – one for young and healthy individuals and another for older and sicker enrollees.

The ACA was nearly repealed in Congress in 2017 but two issues saved the bill, said Joanne Kenen of the Johns Hopkins Bloomberg School of Public Health. Those issues were expanding Medicaid in the states and keeping coverage for those with preexisting conditions.

“Now what they’re talking about is creating two risk pools – so you’ll still be covered but will it cost you more?” she asked. “Right now, the ACA has spread out that risk.”

Because Medicaid is an open-ended entitlement, the program is a target for lawmakers who want to curb its cost, Kenen said. Republicans have suggested replacing the current program with a block grant or a per capita grant, limiting the growth rate of Medicaid or giving states a smaller budget for the program.

Kenen noted that Medicaid also is a major payor for long-term care and nursing homes, and cutting the program would impact the nation’s vulnerable elderly.

“It’s expensive to cover sick people,” she said. “Doctors, nurses, the entire health care system would rather have people covered. If you have more uninsured people, it has ripple effects throughout the entire health care sector.”

President-elect Donald Trump nominated Robert F. Kennedy Jr. as Secretary of Health and Human Services with the goal to “Make America Healthy Again.”

Diamond said that Kennedy’s agenda is focused on combating chronic disease. “[Kennedy] has a point that chronic disease is a killer in America, it’s a major factor in our death rates, but there’s a lot to do with running HHS that has nothing to do with anything that was said during the campaign,” he said.

“We might not know where he stands until he gets installed and starts rolling out policies.”

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Susan Rupe is editor in chief, magazine, for InsuranceNewsNet. She formerly served as communications director for an insurance agents' association and was an award-winning newspaper reporter and editor. Contact her at [email protected].