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Republicans have outlined five approaches either to weaken the Affordable Care Act or to replace it with other alternatives. Their preference would be to repeal the existing law and replace it with a new one. Other approaches that they are pursuing or may pursue in the coming months include weakening various provisions of the law or cutting the funding to implement them; weakening regulations designed to implement the law; urging states to decline to implement provisions, such as creation of new health insurance exchanges; and pursuing lawsuits at the state level that challenge the law in its entirety or provisions of it. These approaches are discussed further below.
Repeal and Replace: After voting to repeal the law in January 2011, the House passed a resolution (H Res 9) instructing four major committees--Ways and Means, Energy and Commerce, Judiciary, and Appropriations--to draft legislation "to replace the existing health care law." As of publication of this brief, it is unknown whether House Republicans will draft a single replacement bill or seek to take up a number of measures separately. If replacement legislation does pass the House, however, it is likely to face strong opposition from the Obama administration as well as the Democratic majority in the Senate.
Repeal Specific Provisions: Another approach is to repeal specific provisions of the law and replace them with alternatives. One example is the so-called 1099 provision, a revenue-raising portion of the reform law that the Senate has already voted to repeal and that also faces likely repeal in the House (see the Health Policy Brief published February 14, 2011, for more information). But there are other provisions of the law that Republicans--and possibly some Democrats--may seek to repeal as well, including the following:
• The individual mandate. This is the requirement that, as of 2014, most Americans will have to secure health insurance or pay a penalty. The rationale for the mandate is to create large risk pools, prevent people from waiting until they are sick to get coverage, and thereby make the new exchange-based insurance markets sustainable. But public opinion polls show that the provision is unpopular, and the constitutionality of the mandate is being challenged in federal court.
• The prohibition on states to reduce Medicaid eligibility. In addition to expanding Medicaid eligibility overall as of 2014, the health legislation requires states to maintain their existing eligibility levels for Medicaid until 2014. It also prevents changes in application procedures that would make enrollment more difficult. However, some governors have sought flexibility to scale back Medicaid to help close large budget gaps, and it is possible that Congress could go along.
• The employer mandate. Under the law, employers with 50 or more full-time workers (or equivalent part-time workers) will face penalties as of 2014 for failing to offer affordable coverage to employees.
• The CLASS Act. In its 2010 report, the National Commission on Fiscal Responsibility and Reform singled out one provision of health reform, the Community Living Assistance Services and Supports Act, as being "financially unsound." The report noted that the "program's earliest beneficiaries will pay modest premiums for only a few years and receive benefits many times larger, so that sustaining the system over time will require increasing premiums and reducing benefits to the point that the program is neither appealing to potential customers nor able to accomplish its stated function."
The secretary of Health and Human Services (HHS), Kathleen Sebelius, acknowledged these concerns in a speech in February 2011, and said her department, as the law requires, will make sure that benefits and premiums are set at levels so that the program is self-financed. Meanwhile, some congressional Republicans have specifically targeted the CLASS Act for repeal.
• Funding that could support abortions. A federal statute, renewed annually, prohibits the use of any federal funds allocated in annual congressional appropriations to pay for abortions. However, right-to-life proponents argue that the health reform law creates multiple new streams of federal funding for health initiatives that would not be covered by the statute. As a result, some in Congress want to eliminate or reconfigure a number of provisions that could be construed as allowing public funding for abortions.
• New boards and institutes. A number of new entities created by the Affordable Care Act are targeted for repeal by congressional Republicans. These include the Independent Payment Advisory Board, a new organization that, as of 2013, is charged with developing proposals to reduce per capita growth in Medicare spending, issuing advisory reports related to Medicare, and making recommendations to slow the overall growth in national health expenditures.
Also targeted for elimination are the Center for Medicare and Medicaid Innovation--a division of the Centers for Medicare and Medicaid Services charged with developing approaches for improving health care delivery and reducing costs in both programs--and the Patient-Centered Outcomes Research Institute, created by the Affordable Care Act to oversee and carry out comparative effectiveness research (see the Health Policy Brief published October 8, 2010, for more information).
Block Regulations: Once a bill becomes a law, federal agencies often must create regulations to fill in the details and allow for its implementation. Attempts to block regulations carrying out provisions of the Affordable Care Act are likely.
Lawmakers can try to block regulations by using the Congressional Review Act. This rarely used process requires a joint resolution of Congress passed within 60 days of the regulation being sent to Congress. The resolution of disapproval must be signed by the president (or Congress must override a presidential veto).
At least one resolution of disapproval has been introduced so far in the House challenging the medical loss ratio rules (see the Health Policy Brief published November 24, 2010, for more information). However, the challenge faces opposition in the Democratic-controlled Senate.
Hold Hearings: Several House committee chairs already have convened oversight hearings and plan for many more. Their goal is to shine light on what they see as a flawed Democratic health law and to muster support for Republican alternatives. The plans they are likely to highlight include proposals that Republicans have long favored, such as allowing people to purchase insurance across state lines, providing more tax breaks for buying insurance, and limiting noneconomic damage awards in medical liability (malpractice) cases. In response, in the Democratic-controlled Senate, key committees are likely to hold hearings to draw attention to what Democrats regard as the benefits Americans are reaping from health reform.
Defund Implementation: In general, the Republican-led panels in the House will try to trim or block spending on health reform, while Democrat-led panels in the Senate will seek to fund it. Many of the efforts to repeal, defund, or otherwise block provisions of the law have already become part of the debate over federal spending for the current fiscal year 2011, and are likely to be encompassed in the federal budget process for the next fiscal year, which starts October 1, 2011.
As of the publication date of this brief, Congress still has not adopted a final federal budget for the 2011 fiscal year. As a result, the government is running on a stop-gap spending measure known as a "continuing resolution," which permits agencies to operate, for the most part, at the prior year's discretionary spending levels.
The current continuing resolution is due to expire on March 4, 2011, and it is not clear whether a new one will be passed, a new budget will be finalized, or the government will be shut down as a result of a congressional impasse.
Continuing Resolution Amendments: As House Republicans try to put in place a new spending plan for 2011, they have moved to defund or block spending related to the Affordable Care Act. On February 19, in a near party-line vote, House members adopted nine such amendments. They include prohibiting use of federal funds to pay the salaries of any employee or contractor involved in carrying out the health care law and stripping funding for putting into effect all or parts of the law. These parts include the so-called individual mandate, medical loss ratio requirements for insurance companies, setting up health insurance exchanges, and funding for the Independent Payment Advisory Board.
The debate over these issues is likely to carry over into the process of arriving at a new budget for fiscal 2012--a process that is certain to be especially complicated this year. Normally, the president first submits a proposed budget to the Congress; Congress adopts its own budget "resolution" that sets forth spending and revenue targets for the year; House and Senate appropriations committees prepare spending bills that fall within the guidelines set forth in the budget resolution; and these bills and any revenue measures then see final floor action in the full House and Senate, including reaching compromises on their separate versions of spending and revenue bills.
This year, of course, each party controls one chamber, and ideological differences run deep. As a result, many observers deem it likely that the two houses of Congress will fail to agree on a single budget resolution, which would mean that none will be adopted.
Appropriations: With or without a final budget resolution, House and Senate appropriations committees will eventually have to draw up spending bills to fund specific federal departments, agencies, and programs. Critics of the Affordable Care Act are likely to use the appropriations process to slash funds needed to administer and implement the law. Again, any bills targeting health reform in the Republican-controlled House would have to overcome opposition from Senate Democrats.
For instance, Republican lawmakers have already singled out for elimination the estimated $5–$10 billion needed in the coming years for the Internal Revenue Service to enforce the individual mandate and to administer the tax credits and other tax provisions in the Affordable Care Act.
A similar amount will also be needed for the Department of Health and Human Services to enforce and implement the law, and these funds could be targets for elimination as well. In addition, Republicans could try to insert a provision into the regular appropriations bills, or as a continuing resolution, directing that funds not be spent to implement health reform.
However, federal agencies have some leeway to move funds around. If monies for implementing health reform are not appropriated or are struck from the budget, implementing health reform would be a challenge, but it wouldn't necessarily be stopped altogether.
Blocking "Mandatory" Spending: Some federal spending is mandated by programs that are outside of the normal annual appropriations process. These "mandatory" programs include Social Security, Medicare, Medicaid, as well as income support programs such as "food stamps" and veterans' retirement programs. Under the Affordable Care Act, proposed spending on the CLASS Act; the subsidies available as of 2014 to help people buy health insurance; and even funding for the Center for Medicare and Medicaid Innovation are classified as "mandatory" spending.
Despite the word "mandatory," congressional rules governing this type of spending can be overridden and appropriators can change mandatory spending levels. The insiders' nickname for this process is CHIMP, for Change in Mandatory Programs. Republicans could try to achieve changes in the mandatory components of the Affordable Care Act in the course of crafting the fiscal 2012 budget.
Another way changes in mandatory spending could be carried out is through the process known as budget "reconciliation." This process allows changes to be made in law so that taxes or spending, including mandatory spending, conform to the targets set in the congressional budget resolution. Reconciliation legislation can be passed by a simple majority of the Senate, without the threat of filibuster.
No Reconciliation: However, there cannot be reconciliation without a budget resolution. Since that seems unlikely this year, given the deeply divided Congress, reconciliation is not expected to serve as a vehicle for eliminating funding for health reform.
Regardless of their efforts, House Republicans cannot enact budget and spending changes unilaterally. They need approval of the Democratic Senate and the president's signature. Even if Republicans do manage to win over some Democrats on individual elements of their agenda, such as weakening the individual mandate, there is little chance that they will be able to muster the two-thirds majority in both chambers needed to override a presidential veto.
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Written by
Joanne Kenen
(Kenen is a veteran journalist and author covering health policy on Capitol Hill. She was a senior writer for the New America Foundation's Health Policy Program, a Kaiser Family Foundation Media Fellow, and a Reuters news service correspondent.)
Editorial review by
Stan Collender
Partner
Qorvis Communications
(Collender is an expert on the congressional budget process, having worked for both the House and Senate budget committees and for lawmakers on House budget and ways and means committees.)
Robert Greenstein
Executive Director
Center on Budget and Policy Priorities
(Greenstein is an expert on the federal budget, having directed federal food assistance programs in the Carter administration and headed the federal budget policy component of President Obama's transition team.)
Douglas Holtz-Eakin
President
American Action Forum
(Holtz-Eakin is an economic and budget policy expert, having served as director of the Congressional Budget Office and chief economist of the President's Council of Economic Advisers.)
Ted Agres
Senior Editor for Special Content
Health Affairs
Susan Dentzer
Editor-in-Chief
Health Affairs
Health Policy Briefs are produced under a partnership of Health Affairs
and the Robert Wood Johnson Foundation.
Cite as:
"Health Policy Brief: Congress and the Affordable Care Act,"
Health Affairs, February 25, 2011.
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www.healthaffairs.org/healthpolicybriefs
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