Medicaid CMO, Cleveland Clinic CEO criticize ACA replacement as Republicans push back

As negative reactions from healthcare leaders to the American Health Care Act (AHCA) have continued to come out, one Republican lawmaker supporting the Affordable Care Act (ACA) replacement hit back against what he called the “medical industrial complex.”

Following announced opposition to the legislation by groups like the American Medical Association and the American Hospital Association, Cleveland Clinic CEO Toby Cosgrove, MD, told CNBC that the current bill would harm hospitals with its rollback of the ACA’s Medicaid expansion.

“Hospitals are running at very thin margins. Fifty-two percent lost money on operations,” he said. "We all have skin in the game. If hospitals start to fail across the country, we have a problem.”

Hospitals did get one of their big asks in the repeal-and-replace plan, which would restore cuts to Medicaid disproportionate share hospitals (DSH) payments. With such a hospital-friendly provision included, House Energy and Commerce Committee Chairman Greg Walden, R-Oregon, called it “sort of shocking” the industry has come out against the bill.

“We understand you change this thing up, there's a pretty big medical industrial complex in America, and when you touch it, I've discovered it touches back," Walden said at a March 8 press conference.

It’s not just hospitals and physicians coming out against parts of the package. America’s Health Insurance Plans (AHIP), health insurers’ largest lobbying organization, said in a letter it supports provisions like allowing insurers to charge older customers up to five times more than younger people and the penalty for not maintaining continuous coverage. The bill’s new system for tax credits for buying insurance, however, may not be adequate in AHIP’s eyes.

“Tax credits related to age as well as income will help ensure that more people stay covered, and are the most efficient and effective way to allocate tax-payer dollars,” wrote AHIP President and CEO Marilyn Tavenner.

The Blue Cross Blue Shield Association expressed similar concerns, then went a step further in recommending additional changes, like additional “market stabilization” measures to make up for the repeal of the individual mandate penalty.

Molina Healthcare CEO Mario Molina had a much harsher critique of the AHCA, saying in an interview with the Wall Street Journal it would “destabilize the marketplace,” leading to premium increases of more than 30 percent for 2018 and driving insurers away from the individual market.

Criticism of the bill has come from inside the federal government, as well. Andrey Ostrovsky, MD, an appointee of President Barack Obama as chief medical officer for the Center for Medicaid and CHIP Services within CMS, tweeted he was opposed to the legislation “despite political messaging from HHS.” He later added he believes the AHCA falls short of why he was hired “to add rigor of evidence, introduce innovation, improvement principles to Medicaid.”