Video
Senate Majority Leader Mitch McConnell and other Republican leaders leave the Senate floor after the vote to proceed to debate on healthcare legislation, July 25, 2017. Photo: Bill Clark/CQ Roll Call via Getty Images.

What’s at Stake in the Healthcare Debate?

All of the variations of the legislation under debate on Capital Hill are expected to cause tens of millions of people to lose their health insurance, with effects that would reverberate throughout the healthcare system and the broader economy. Yale Insights talked to Howard Forman, a Yale physician and economist, about the consequences of Congress passing a repeal of the Affordable Care Act—and what might happen if nothing passes.


This interview took place on July 26, 2017, as the U.S. Senate debated repeal of the Affordable Care Act.

Q: Dr. Forman, the last 24 hours have been quite dramatic in the Senate. Where does the bill stand now and what can we expect in the next 24 hours or so?

They often say there’s two things you don’t want to watch being made and one is sausage and the other is legislation, and this is the reason why. Most of the legislative process usually proceeds by regular order, with a single senator or congressman proposing a bill, proceeding to a committee, and working its way to the floor of the Senate once you have all your ducks in a row, so to speak. In this case, we’re watching most of the process out in the open with no necessary confidence about what can or will pass.

And so we’re in a process right now where through various steps the Senate is testing certain votes to see which senators will go for which aspects of which bills. Then it’ll move into a 20-hour period of debate and what will follow that is what’s called “vote-a-rama,” where numerous amendments introduced with very, very short debate over what may be more than a 24-hour period, and at the end of that process a single bill will presumably be introduced to replace the pending House bill, and that bill will get voted on. But before that happens we will see other numerous votes occur and those votes will give us a sense for where the Senate stands on the matter.

Q: We don’t know what exactly will come out of all this but the various proposals that have been put forward over the last several months have numerous things in common. What are key ways that the bill would likely change the status quo?

There’s several aspects to the bill that should either concern us or should give us some hope. Ideally, we would be seeing things that would strengthen the mandate that would help ensure that insurance markets in the states operate more efficiently and provide adequate assurances to insurance companies and state governors that both the exchanges and the Medicaid programs can function properly. I would say that for women, and even men, being able to continue receiving funds in Planned Parenthood is also of paramount importance to many, many people, and those are the things that are all in play right now.

Q: How do you think the various stakeholders—patients, doctors, hospitals, insurance companies—will be impacted?

It’s very difficult to imagine too many stakeholders that actually benefit from this. Clearly, there are some non-poor individuals in the individual insurance market who are healthy and more often than not young who would benefit from this, and this is not inconsequential—this is a few million people—but it’s a relatively small segment of the overall population. Healthcare providers, for the most part, you would expect to be worse off from a bill like this, whether you’re hospitals, physicians, and so on. Those that receive tax cuts, like the medical device industry, even the pharmaceutical industry, and so on, might—and certainly certain rich individuals might benefit from this financially.

Up until very recently, this bill has been mostly a big tax cut financed by cuts in the Medicaid program, and the Medicaid program touches at least 70 million individuals in this country and more than 80 million over a two-year window. That’s almost 25% of the population that is potentially harmed by cuts in this bill.

Q: With any bill that comes out, the impact will not be uniform across the country. What can we expect from the impact in different states?

Certainly states that have expanded their Medicaid program, states that have more elderly individuals, states that have more high-cost healthcare to begin with, are states that will be worse off if this bill were to pass. Certainly, states that rely on Planned Parenthood to provide primary care and abortion services would be worse off. There are other states that I would say are less worse off. It’s hard to imagine cutting $700 billion from Medicaid that isn’t going hurt every state to some degree; it just varies how much each state is harmed by this. To the extent that some of those states will have a more free-market insurance program, some individuals in those states would be better off.

Q: Will there be an urban-rural divide in the effects?

Healthcare costs are higher in urban areas and they’re more likely to have had Medicaid expansions, so certainly urban areas will be considerably worse off than rural areas in some ways. But rural areas will also be considerably worse off, partly because a lot of the rural areas are also lower-income areas, and lower-income individuals are much more likely to be eligible for Medicaid, and therefore, much likely to suffer cuts from Medicaid. So even though there is a divide in how they’re impacted, they are both impacted negatively.

Q: Each version of a replacement bill that the CBO has scored has shown tens of millions of people losing access to their insurance. What are the implications for the system of a flood of people suddenly becoming uninsured?

The aggregate numbers that we’re seeing right now are if there’s no follow-on legislation, and the Republicans have promised and the White House has promised that they will have follow-on legislation. So the numbers we’re seeing are the uppermost numbers without follow-on legislation.

Having said that, it takes a long time to pass legislation and it’s very unclear given the mandate from Paul Ryan to basically cut dollars out of the healthcare budget that you’re going have anywhere near the type of coverage we have right now. We’re at actually historically high insurance coverage rates in this country, even though a lot of people may not recognize that. Losing that many people from the insurance market means that once again providers will be providing a considerable amount of uncompensated care, that patients will lose access to primary healthcare and preventative healthcare, and that overall we’ll begin to see once again many uninsurable individuals—those with preexisting conditions—finding it difficult to access insurance markets.

Q: There is no guarantee that anything will come out of the Senate. If it fails this time around, do you think that’s the end of the attempts to repeal Obamacare? And in that case, what can we expect from the administration, which has been so hostile to the Obamacare from the beginning?

You know, the President is a showman, so it’s very difficult to know what his long-term strategy is or even what he firmly believes, but one thing is certain: the Republicans right now own healthcare in America. They may not have passed Obamacare but at some point you have to own the domestic agenda and you own your foreign policy agenda. You can’t continue to blame a prior administration. You know, for a few months, for maybe six months, you can talk about the prior administration. At some point, particularly when you own all branches of government, or at least the executive and legislative branch, it is very difficult to deflect attention to something else, so the Republicans are going to have to address this one way or the other. And the continued undermining of the implementation and carrying out of the ACA is going have to stop, because it is counter to the best interests of the people and therefore the interests of the Republicans as well.

Q: As a physician, how do you view this issue? Is it a moral issue for you?

It is really difficult to already contemplate that there are 30-plus million people in this country that do not have a legitimate point of access for healthcare. They may or may not have access to federally qualified community health centers, which have reduced costs. They may or may not have access to emergency rooms. In many cases, they theoretically do but it can bankrupt them so they have less access than we would like them to have. And from the point of view of healthcare in this country, it’s in everybody’s best interest for everybody to have access to healthcare.

We have a recent outbreak in Maine of pertussis and I think either mumps or measles, a recent outbreak of childhood diseases that are otherwise preventable. Some of that may be due to religious and other objections to getting vaccinated, but some of that may be due to the fact that people don’t have an access point to healthcare and therefore don’t get healthcare. We need every single individual to have access to healthcare in order to have preventative care, in order to protect the overall population, and from a social justice standpoint, for us to be able to go to sleep at night believing that basic services are provided to everyone, irrespective of their ability to pay.

Q: How big are the potential spillover effects of this legislation on the rest of the economy?

You know, the CBO did a reasonably good job predicting the effects of the ACA but they got some things wildly wrong—they greatly underestimated the Medicaid expansion and overestimated the coverage on the exchanges. It’s very hard to predict how markets will respond. It’s hard to predict what a Republican, or for that matter, Democratic governor would do if their Medicaid dollars are being cut, and if you know your Medicaid dollars are being cut even in 2020 and 2026, what do you start to do to prepare for that in the future?

One thing that is certain is that the states have only two big buckets of dollars that they play with: Medicaid and education. When Medicaid dollars get cut or there’s a strain on the Medicaid budget, they end up going to education, so if you’re going to cut dollars from the state budget that impacts them, you may see spillover effects in secondary education and undergraduate education. That’s a big spillover effect that no one’s talking about right now. We saw that happen during the recession. We see the fact that there’s this interplay between education and healthcare.

The spillover effects occur everywhere: our ability to respond to epidemics, our ability to continue to prevent infectious disease, our ability to innovate. These are very much predicated on a well-functioning healthcare system. And even though our system is far from perfect right now, we’ve made big strides over the last seven years.

Q: It’s difficult to judge what the effects are going be when no one knows exactly what bill is going come out of this.

That’s right. It’s very unclear what is possible to pass right now. You know, right now, if I had to guess, I’d guess that nothing will pass, but that’s predicated on the fact that Lisa Murkowski and Susan Collins seem to be solid nos, and they could be drawn back in if they believe that Planned Parenthood is no longer part of the equation and if there are no Medicaid cuts. And the skinny repeal option, which is the one option that seems to be getting some traction, does have that going for it.

I’m not sure that Senator McCain would go for that, though, because he got up on the high horse yesterday and said that he wouldn’t vote for a shell, that he wants to vote for something that’s part of the regular process. If this is done only for political purposes, it goes against what Senator McCain said yesterday we should be doing. If you’ve lost Senator McCain you might lose a few other sympathetic people who just think that he’s on the right side of history right now. He hasn’t made too many votes that have shocked people but this could be one of them, and particularly since he knows he’s not up for election ever again, effectively, he’s more untethered than he’s ever been.

Q: On the Democratic side, as this has gone on, you’ve seen more and more support for a single-payer system. Do you think that’s realistic, once the Democrats are back in power, perhaps with a supermajority?

I used to think it was impossible in my lifetime to contemplate the idea of single-payer system. Right now I think it’s very feasible. If the Republicans do what we think they’ll do now and really upend the markets so that we’re back to having 45 or 50 million uninsured and we have skyrocketing deductibles and premiums, which we sort of have right now, then if the Democrats get back into power, particularly with a 60-vote majority, which is not impossible in 2020, you could very much imagine a scenario where a public option, or something that gives us a path to a single-payer system, is passed.

Now it might mean that some parts of the country become much more flexible in how they administer the ACA or whatever we have at that point, and therefore, the public option only exists in some states. There may be some states that embrace the public option and others don’t and it continues to make our country a laboratory for change. You may find that states that use the public option have worse healthcare, and therefore, the pendulum swings back the other way, but it’s certainly a possibility now whereas in the past I thought it was impossible.

Q: If you can get enough people from both parties to together to have the necessary votes, what might a bipartisan fix to the ACA look like?

In a perfect world, Democrats would come to the table with a list of asks and a list of offers. And knowing that the Republicans have the majority, they would give the Republicans small wins: widen the age bands [limiting the variation in insurance rates based on age] from 3:1 to 4:1 in exchange for getting a stronger mandate, not a weaker mandate; allow states to have slightly more flexibility with the EHBs, the essential health benefits—not taking away any of the EHBs but allowing slightly more flexibility in how the EHBs are regulated. Allowing the insurance commissioners of the states to have slightly more latitude, giving Medicaid waivers more freely to states that want them. There are a lot of things that could be done. Allowing a transition to block grants in Medicaid without cuts in Medicaid dollars so that you start the experiment of giving states more flexibility with their Medicaid dollars rather than cutting dollars out of Medicaid.

You could do all those things and actually still save some money on the margin. It wouldn’t be the type of money that we’re talking about saving now, but enough money to show that the Republicans are extracting concessions and getting more people insured. The very notion of having, if you could imagine it, more people insured, at a lower cost—that’s a win, a true win. Enhancing the ability of Medicare and Medicaid to use evidence-based medicine to hold down costs there, that’s another big win.

So I have a lot of confidence that there are bipartisan approaches that could happen. We do need to get past this phase right now where both parties have politicked for so long and see if they can work together. There were some amazing times in the ’90s and even the early part of the last decade when odd bedfellows came together in rather surprising places. Paul Wellstone and Pete Domenici coming together on mental health parity. Orrin Hatch and Ted Kennedy, two of the most extreme right and left people in Congress, coming together numerous times over healthcare legislation and particularly drug legislation. It’s not impossible to imagine that.

I would love to see that type of behavior start to be rewarded by the public. Right now, partly because of Citizen’s United, when people compromise on anything they seem to get whacked by their own party, and the president has threatened to primary out anybody who defies him. Maybe if there’s unified defiance he won’t be able to do that anymore. You need a large caucus of moderate Republicans and a large caucus of moderate Democrats to start to have confidence in themselves and not be afraid of being Tea Partied out. It would be nice if they would band together and do what’s right for the country, not what they think is going serve their party best.

Q: If you were designing the system yourself, what would it look like?

The one thing I would love both parties to re-contemplate is the application of evidence-based care in Medicare and Medicaid and to stop paying for things that don’t work. But ever since the healthcare debate of 2009 and Sarah Palin’s discussion of death panels, we’ve lost traction in delivering high-value healthcare because people are afraid of allowing government to make medical decisions, but I would say that the medical decisions have already been made. The question is, should we be paying for bad medical decisions?

Professor of Diagnostic Radiology, Economics, and Public Health; Director of the M.D./M.B.A. Program; Director of Healthcare Curriculum, M.B.A. for Executives Program; Lecturer in Ethics, Politics, and Economics