The battle to repeal Obamacare has begun. Financial markets are punishing shares of HCA and UHS. Those large healthcare companies expected to benefit from Hillary Clinton expanding Obamacare. Meanwhile, biotech shares have jumped because Hillary won’t be around to flog them or slap an arbitrary cap on their prices.
Donald Trump and his advisers call Obamacare “a disaster.” Many Americans agree. In a TV appearance a few days before the election, I argued that Obamacare would help Trump win over voters in states like Michigan and Pennsylvania. The so-called exchanges have been more than decimated, with stalwart firms like Aetna and United fleeing many locales. In one in three counties, the online exchanges will present virtually no choice among insurers.
How does Trump think about healthcare? Here are key points he keeps in mind: First, Obamacare was recklessly ambitious. Instead of overhauling the entire healthcare system for 300 million, it should have targeted the 28 million uninsured households that earned less than $50,000 a year but were either too ignorant to sign up for Medicaid, or earned too much money to be covered by that program. Trump will propose a refundable tax credit so that middle and lower-income people can afford to buy their own insurance. Second, Trump will encourage consumers to shop for better healthcare by promoting Health Savings Accounts. The Obama administration never really liked HSAs, which allow consumers to keep for themselves any unspent healthcare dollars. Third, Trump will try to tear down state restrictions that prevent out-of-state firms from selling insurance products within a state. This will be tricky to accomplish and require fancy footwork in the courtrooms. Finally, Trump will keep one popular aspect of Obamacare: the protection of individuals with pre-existing conditions. He will do so by supporting pools that cover high-risk people.
The Democratic Party will, of course, battle to preserve and protect Obamacare. President Obama and Michelle will fight as well, from their new platforms on TV, Twitter, Facebook, and any soapbox they can climb up on to protect their singular, eponymous legacy.