What does the ‘dream’ team have in mind for CMS (Medicare & Medicaid)?

That is what President-elect Trump called his proposed nominees Dr. Price and Ms. Verma as Secretary of Health & Human Services and Administrator Centers for Medicare & Medicaid, respectively.

Dr. Price is a six-term Republican Georgia Congressman from Georgia, practiced as an Orthopedic Surgeon in Atlanta and also served on Speaker Ryan’s task force, which authored “A Better Way.” He proposed his own 2015 alternative to the Affordable Care Act (aka Obamacare) called “Empowering Patients First Act”.  His 2015 comprehensive proposal has several items common to other Republican bills and includes federal block grants to states for establishing high-risk pools for people with pre-existing conditions, replaces means-tested tax credits in the ACA with fixed-dollar, age-adjusted premium tax credits, expansion of health savings accounts, including preexisting condition coverage, sale of insurance across state lines, association health plans, balance billing and ability of physicians to collectively bargain with insurer companies etc.

Ms. Seema Verma is the President, CEO and founder of SVC, Inc., a national health policy consulting company.  For 20 years, Ms. Verma has consulted and worked on projects dealing with Medicaid, insurance, and public health as well as several Governor's offices, State Medicaid agencies, State Health Departments, State Departments of Insurance, as well as the federal government, private companies and foundations. Vice-President Pence had Ms. Verma design the state of Indiana’s Healthy Indiana Plan (HIP), which was also then used as a model for Michigan, Maine etc. She also negotiated the waiver of the Indiana HIP program design (1115 Medicaid waiver) with the Centers for Medicare and Medicaid Services (CMS), supported implementation efforts, developed the waiver renewal application and negotiated a financial agreement with the Indiana Hospital Association for the Hospital Assessment Fee program.

Indiana’s Medicaid expansion has covered as many as 410,000 persons and was different in that it supported ‘personal responsibility’ in having those who were able to afford it pay something towards their healthcare as well as take some responsibility for ther health. Although the poor were not required to pay any premiums, of those who were able to afford minimal monthly premiums as low as $4, non-payment made them ineligible for as many services and warranted a six-month lockout from coverage if even a single payment was missed.

Summary: Most experts predict that most parts of the ACA may be repealed but the effects of ACA may be delayed to prevent loss of coverage for over 20 million people. This is likely for several reasons. First, new legislation will need to be ‘scored’ (budget positive/negative) by the Congressional Budget Office and then passed by both houses. Second, if ACA is repealed all the taxes to fund any replacement go away including taxes such as the Medicare surcharge tax, tax on individual investments, health insurer fees, taxes onmakers and importers of drugs. Finally, people covered by exchanges and on current Medicaid expansion plans will gradually switch over to the new replacement plan. Will there be enough revenue if these taxes are repealed to fund the new plan? The President-elect has called for insurance policies to be sold across state lines. However, this may mean 50 different regulatory bodies to oversee insurance companies. How will this work in practice? A Sermo survey of 2,239 physicians including VS showed a 50/50 split on whether to keep or repeal the CA whereas in a previous survey by the Physicians Foundation, 46 percent of physicians gave Obamacare a D or F grade.

We should get a glimpse of the answer within a few weeks.