Supreme Court ruling on healthcare law could bring trouble for Republicans

The Supreme Court’s landmark healthcare ruling will pose a big test for Republicans, even if the court strikes down all or part of President Obama’s healthcare law.

So far, the party has not come together around a set of policies to replace the healthcare law if it’s struck down entirely. Republicans also haven’t said how they would handle policies that are already in place, including discounts on prescription drugs for many seniors.

“House Republicans will proceed with a rational, positive transition so that any disruption that’s created by the court decision is mitigated,” said Rep. Tom Price (R-Ga.), who chairs the Republican Policy Committee.

The court is expected to decide this month whether the law’s mandate that individuals buy insurance is constitutional — and, if not, whether to throw out the entire law, or only part of it.

A ruling against the health law would certainly be a blow to Obama, and Republicans would claim that it validates their entrenched opposition to the president’s signature legislative achievement. But it would also present political and policy questions the GOP is not necessarily ready to answer.

Planning for the GOP got a little easier this week when three large insurers said they would voluntarily leave in place certain parts of the healthcare law even if the statute is struck down. UnitedHealth, Humana and Aetna said they would continue to let young people stay on their parents’ plans through age 26 — a popular piece of the health law that Republicans had said they planned to replace.

The rest of the “transition” won’t be as easy. Drug companies might not be able to voluntarily continue providing discounts on prescription drugs, and some items just can’t be done by the private sector. Part of the law simply reauthorized existing programs, some of which had been in place for decades before the healthcare law was signed.

When asked whether the GOP would move first to replace the law’s reauthorizations and other small-bore, generally agreed-upon items, Price said such speculation was “premature.”

Perhaps the most difficult challenge for Republicans would come from a decision striking down only the mandate, leaving the rest of the law intact. The immediate political response is clear: House Republicans will pass a bill to repeal what remains, which will go nowhere in the Democratic-controlled Senate.

As a practical matter, though, a decision striking only the mandate would lead to a policy scenario that all sides — Republicans, Democrats, the insurance industry and independent policy experts — see as dangerous and unsustainable.

Republicans could then face mounting pressure to walk away from their hard line against “fixing” the Affordable Care Act.

“It puts them with a very difficult choice,” one healthcare lobbyist said.

The mandate was included in healthcare reform to offset the costs of two popular provisions: requiring insurers to cover people with pre-existing conditions, and barring them from charging higher prices to those consumers. Most experts agree that implementing those two provisions without the mandate would cause premiums to soar.

Republican presidential candidate Mitt Romney said Tuesday that insurers should not be able to drop existing customers because of a pre-existing condition. That policy is already federal law, separate from the healthcare law. It would apply only to people who are already insured, whereas the healthcare law provides guaranteed coverage to people who have lost their insurance.

Unless Republicans pick up the White House and enough Senate seats to fully repeal the healthcare law, they could come back to Washington in 2013 facing a difficult choice: break their pledge not to fix the healthcare law, or try to repeal only the law’s most popular provisions.

“Clearly in 2013 there’s going to have to be something done,” another healthcare lobbyist said. “At a certain point, they’ll have to have that discussion.”

Pressure to fix the healthcare law would come not only from Democrats, but also from the insurance industry.

The industry’s leading trade group, America’s Health Insurance Plans (AHIP), lobbied hard for the mandate. AHIP didn’t take a position on whether the mandate is constitutional, but filed a brief with the Supreme Court stressing the link between the coverage requirement and other provisions.

In the run-up to the decision, AHIP has focused its efforts on educating lawmakers and the public about the link between the mandate and other reforms, including the requirement to cover people with pre-existing conditions.

AHIP recently released white papers describing the failure of state-level efforts to ban pre-existing condition exclusions without a mandate. Kentucky and Washington state tried to pass standalone insurance reforms, only to see premiums spike. Both states eventually abandoned the regulations.

AHIP would not comment on its lobbying plans under various Supreme Court scenarios. But other stakeholders said it’s not hard to see insurers lobbying to replace the mandate, if the policies on pre-existing conditions can’t be repealed.

“Trying to strike those important provisions will be an uphill battle even for the insurance industry,” said Ron Pollack, executive director of the pro-reform advocacy group Families USA.