Health coverage across state lines

In the United States, we have something called regulatory law, also known as administrative law. Created to streamline the legal process, this specialised area of jurisprudence strips defendants of due process niceties related to habeas corpus, trial by jury, and presumption of innocence. The three-lettered government agencies that wield this power - such as the IRS (collects taxes), the EPA (levies environmental fines) and the FCC (polices broadcast media) - inspire fear in our citizenship, because if they target you, you’re pretty much guilty until proven innocent.

Much has been made of the Republican Congress and President Trump’s failure to pass a legislative agenda to repeal and replace the ACA, but it would be premature to put healthcare reform in the loss column before reckoning with regulatory power. Via political appointees who control regulatory agencies, Trump has taken full advantage of this legal muscle in attempts to sabotage Obamacare, deregulate the insurance market, roll back women’s reproductive rights and encourage a laissez-faire commercialism that some say will foster competition but others see as nascent hucksterism.

In addition, on a global scale, when combined with Brexit, the impact of the President’s rhetoric has already so radically altered the geopolitical outlook for the healthcare industry that, even here at the one-year mark, it is scarcely recognisable.

Executive orders

In October, Trump made good on repeated threats to end the cost-sharing reduction payments that had helped insurance companies to afford covering ACA patients. Anticipating this move, most insurance companies had already raised their 2018 premiums by 15% to 25%. Hence, because the ACA’s other subsidies, tax credits, are still intact, the net effect of Trump’s action will be to increase federal assistance to make up for rising premiums. Also, Obamacare customers whose incomes exceed those who qualify for subsidies will likely see sharp spikes in health insurance bills. Overall, growing uncertainly may convince more insurance firms to quit ACA marketplaces entirely.

Trump also instructed cabinet members to do everything in their power to expand the availability of association health plans (AHPs), which allow small businesses, trade groups and others to form associations permitted to buy health coverage across state lines, an act prohibited for other insurance entities. Additionally, the president asked for greater use of short-term, non-ACA-compliant health plans.

Increasing competition by allowing insurers to cross state lines has long been a Republican talking point, but realistically speaking it’s considered a long shot. For starters, there’s no guarantee it will lower prices. Insurance is a regional business, and cost savings or no, providers, employers and patients may be suspicious of new, out-of-state entrants. Furthermore, deregulation on this level will surely inspire a legion of lawsuits. Expect attorneys general in Democratic-controlled states to fight it tooth-and-nail, the same way Republican AsG battled Obamacare.

A bigger question remains: will the majority party survive potential political fallout? For example, deregulation could easily inspire a new industry of fly-by-night, threadbare insurance plans that abandon patients in their time of need. Backlash could be extreme.

“Barack Obama is not president anymore, so the blame falls on those who are in office - regardless of whether they sabotage the ACA or not,” said Joe Antos, an economist who studies healthcare for the American Enterprise Institute, a conservative think tank. “Democrat voters will clearly blame Republicans, but Republican voters may not blame Trump. Those most loyal to Donald Trump may follow his lead and blame the Republican Congress, even though (and perhaps because) they have not passed any health reform legislation.”

Retro-sexuality

Through regulatory channels, Trump’s appointees at the department of Health and Human Services (HHS) are giving employers more leeway to withhold birth control coverage on religious or moral grounds. Additionally, the House of Representatives has passed a bill that would ban abortions on foetuses older than 20 weeks, and the Senate may make it law. Moreover, depending on how many Supreme Court vacancies occur during the next three years, it is conceivable that abortion itself could be returned to its pre-1970s illegal status.

Targeting birth control gives the lie to Republican and conservatives’ oft-professed concern for the life of unborn children, according to Debra Phairas, president of San Francisco-based Practice and Liability Consultants. It’s actually the sexual lives of women these politicians seek to influence, she said. “The evidence is pretty clear that widespread availability of birth control contributed to women getting better educations and being able to support themselves. This is just an ongoing attempt to send women back to the dark ages,” Phairas concluded.

Many women are prescribed birth control medication for reasons other than pregnancy prevention, she added, such as to treat hormonal imbalances or endometriosis. Are there moral grounds against covering endometriosis treatment?

In addition to filling several high-profile jobs at HHS with notorious pro-life advocates, the department recently unveiled its draft strategic plan for 2018-22, which makes several references to ‘life beginning at conception’ and the importance of promoting abstinence programmes via religious organisations. The document also nixes the former administration’s mentions of the health needs of minority and LGBT patients.

A former director of a Planned Parenthood centre, Phairas has first-hand knowledge of the heartbreak that an unwanted pregnancy can inflict on a young woman’s life; how it can destroy chances of obtaining an advanced degree and lead to unhappy marriages. “I graduated from high school in 1972,” she noted. “I remember plenty of girls getting pregnant and having either to drop out of school or going off to Canada [where abortions were legal]. There was a whole stigma attached to it. I just can’t believe there are people who want our country to go back to that again.”

Turn and face the strange

Brexit and Trumpism have wrought fundamental shifts in the balance of power among the United States, Britain and the European Union. Viewed in the context of the global drug trade, some of these changes could benefit US firms.

Trump has made no secret of his distaste for all things European, calling NATO ‘obsolete’ and allowing advisors to characterise the EU as ‘a flawed institution’ and to liken it to the former Soviet Union. From the Paris climate treaty to the World Trade Organization, Trump consistently seeks to distance or disentangle US interests.

In response, European centre-left, pro-EU political parties have seen an uptick in support, winning victories in Austria and the Netherlands. Anti-Trump sentiment likely played a role in Emmanuel Macron’s win in France and Chancellor Angela Merkle’s retention of power in Germany.

Meanwhile, as Britain undergoes Brexit, English-speaking drug companies have been thrown into a state of uncertainty. “A lot of US firms feel like they know the UK the best, that we’re most similar to them in terms of language and culture,” said David Friend, managing director of the BDO Center for Healthcare Excellence and Innovation, a large international consulting and professional services company. “There was a feeling that if you could sell in the UK, then you could sell in Europe as well, because the two were connected. Now, with Brexit, there’s a lot of extra uncertainty and concern.”

But then uncertainty begets opportunity, at least for some. When it leaves the EU, the UK’s economy will be only one-sixth the size of that of the US. Consequently, Her Majesty’s negotiators will no longer hold the kind of bargaining power they once did. One school of thought sees this as a prime opportunity to secure price hikes.

Describing this new dynamic in relation to a contested aerospace contract, The Guardian newspaper put it this way: “For example, in return for a deal, the US would undoubtedly put the UK under heavy pressure to reform the drug procurement procedures of the NHS - as the largest buyer of pharmaceuticals in Europe, the British Health Service essentially sets the prices for many other EU markets, and is thus resented by the US pharmaceutical industry, which sees these prices as unfairly low.”

It’s hard to imagine much friendly talk about ‘the special relationship’ or ‘shared cultural values’ if Trump-inspired dealmakers smell blood in the water.