Repeal, Replace, and Retreat? The Death and Life of the Affordable Care Act

by Shawn Healy, PhD, Democracy Program Director

A mere 65 days into his presidency, Donald Trump was forced to retreat from one of the few singular promises of his campaign: to repeal and replace the Affordable Care Act (ACA). The anatomy of this capitulation is worthy of further exploration in a civics classroom and is framed here in the paragraphs at follow.

Seven years ago, President Barack Obama signed the ACA, arguably his singular legislative achievement. Twenty million Americans have since gained coverage through the combination of expanded eligibility for Medicaid and private health care exchanges with subsidized premiums based on one’s ability to pay them. In exchange for a requirement to purchase health insurance, Americans benefited from guaranteed access regardless of pre-existing conditions and the ability for young adults to remain on their parents’ plan until the age of 26.

The roll out of the ACA left much to be desired and it proved unpopular at the polls, with Democrats sustaining historic losses in 2010, 2014, and 2016, all correlated with the Republican campaign mantra that the ACA was and is a disastrous policy. Moreover, despite the aforementioned coverage gains, health insurance premiums continued to rise in private markets as fewer younger, healthier Americans signed up than projected. They opted instead to pay annual fines. This undermined the cross-subsidization principle embedded in the ACA and health insurance more generally, where younger, healthier enrollees pay premiums, but draw less from the system than their older, sicker peers.



Republicans recaptured the House of Representatives in 2010 and have since voted dozens of times to repeal the ACA. These measures were always symbolic given that President Obama wielded a veto pen and Democrats maintained control of the Senate until 2014. As of this January, Republicans became the dog that finally caught the car, and the onus fell on them to not only repeal the ACA, but also to construct an acceptable replacement.

Their plan, the American Health Care Act, arrived four weeks ago today. It proposed to eliminate the individual mandate and also the penalty paid by large employers that failed to provide private coverage. Medicaid eligibility would also be scaled back, and in exchange for premium supports would be tax credits based on age instead of income.

The Republican plan was met with immediate scorn from both conservatives and moderates within the party’s own ranks. Conservatives claimed that it was only a watered-down version of the ACA, and moderates worried about Congressional Budget Office projections that 14 million Americans would lose coverage in the first year alone. Older Americans would face exponentially higher premiums, a core constituency for Trump’s GOP.

While Republicans in the House have a comfortable majority, these two factions, combined with stiff opposition from Democrats, meant that the American Health Care Act lacked the 218 votes necessary to pass. It was subsequently pulled 17 days after introduction, a stinging defeat for the new President and unified Republican control in Washington (By comparison, the ACA was signed into law 14 months into the Obama presidency).

President Trump and Speaker Ryan have since claimed they will allow the ACA to crumble on its own, vowing to move onto tax reform and infrastructure spending. Assuming the absence of Democratic dance partners, Republicans will need to find a way to bridge the fiscally conservative and populist wings of the party to achieve substantive change.

Moreover, President Trump will need to immerse himself more deeply in the nuances of public policy. “Repeal and replace” made for a useful campaign slogan, but the devil truly is in the details as presidents that have grappled with health reform throughout history learned the hard way.