Minnesota health care groups don't back GOP replacement bill

The primary groups representing Minnesota doctors and hospitals say they oppose the plan to repeal and replace the federal Affordable Care Act (ACA), citing the potential for thousands of state residents to lose coverage.

Earlier this month, House Republicans introduced a bill called the American Health Care Act that would effectively eliminate the ACA's requirement for most people to have health insurance while making big changes to the state-federal Medicaid program.

The plan would be a problem for Minnesota because the state has seen a dramatic reduction in the rate of uninsured residents under the ACA, according to a statement Wednesday by the Minnesota Hospital Association.

Separately, the Minnesota Medical Association called the bill a "significant step backward." The trade group for health insurers, meanwhile, said it didn't support the bill because Minnesota "simply won't have the money to keep care the same as it is now."

Earlier this week, the Congressional Budget Office (CBO) projected the Republican bill would increase the ranks of the uninsured by 24 million as of 2026 relative to current law. Its report, which was developed in part by the Joint Committee on Taxation, also projected the bill would reduce federal deficits by $337 billion over a 10-year period.

In Minnesota and elsewhere, some have welcomed the bill, saying it would promote market-based health care, eliminate ACA taxes and bring needed cost control to Medicaid.

But the Minnesota Hospital Association, which supported passage of the current federal health law, said Wednesday it's opposed to the GOP proposal. The group represents 142 of the state's 145 hospitals, and its members collectively employ about 127,000 people.

"We cannot support a return to a system that increases our rate of uninsured; re-creates a reliance on the emergency room; and discourages preventive care, mental health care, routine screenings and other health care throughout a person's lifetime," said Lawrence Massa, the president and chief executive of the Minnesota Hospital Association, in a statement.

The ACA has helped hospitals by reducing uncompensated care costs. In Minnesota, charity care costs declined from $226 million in 2010 to $164 million in 2014.

A report earlier this month from Moody's Investors Service said the Republican bill would be "credit negative" for hospitals because it "would reduce the number of people with health insurance and increase bad debt and uncompensated care costs."

The Minnesota Medical Association, which represents 10,000 physicians and doctors in training, said the GOP bill fails to improve the affordability of care and coverage.

The bill would replace the ACA's tax credits with subsidies that would reduce financial support for those least able to afford coverage, said Dr. David Agerter, the group's president, in a statement. The bill also would threaten the viability of Medicaid by reducing federal funding.

Nationally, the American Hospital Association and the American Medical Association are among the health care trade groups that don't support the Republican bill.

Some health insurers and health insurance trade groups have expressed support for aspects of the GOP bill that are designed to promote stability in the individual market, where the self-employed and those who don't get coverage from an employer buy health insurance.

But the Minnesota Council of Health Plans, the trade group for the state's nonprofit health insurers, said Wednesday the Republican bill moves away from the goal of widespread coverage.

"The focus needs to be on fixing high medical expenses, not insuring fewer people," Jim Schowalter, chief executive for the trade group, said in a statement. "The bill would have most people who buy insurance on their own paying more, even if they can't afford it, and large cuts will be needed in insurance for Minnesotans with low incomes and disabilities."

The ACA drove fundamental changes to the individual market, resulting in instability that has driven up premiums and caused some health insurers to drop out.

House Speaker Paul Ryan, R-Wis., cited the example of Minnesota and a few other states this month in making the case for the GOP plan.

The legislation on Wednesday got backing in an open letter to Congress from conservative groups, including the Center of the American Experiment, a Golden Valley-based conservative think tank.

"The bill would eliminate both the individual and employer mandates, which are punitive measures that have effectively acted as hefty taxes," says the letter, also signed by Grover Norquist, the influential president of Americans for Tax Reform. "Additionally, the legislation would implement the most significant entitlement reforms in more than 20 years."

Some Minnesota critics of the ACA have been critical of the GOP plan, saying it doesn't go far enough.

"GOP lawmakers are trying to fix Obamacare rather than get rid of it," Twila Brase, president of the St. Paul-based Citizens' Council for Health Freedom.

"The American people asked for repeal, but with this bill the GOP is issuing its own federal mandates and its own federal requirements," Brase said.