Health Industry Cool To Complete Repeal Of New Law

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Republicans made major gains in the midterm election, running vowing to "repeal and replace" the health law passed with solely Democratic votes earlier this year.

But while a large majority of GOP voters told exit pollsters they strongly support the idea of starting from scratch on the health overhaul issue, major players in the health care industry -- usually strong Republican allies -- are a lot less enthused about the idea.

"No one has said what this bill would be replaced with," said Richard Umbdenstock, president and CEO of the American Hospital Association. "But doing away with this would certainly be the wrong thing. ... People have been gearing up for some time, well before this actual bill got passed, to make these changes locally, and have invested a lot."

It's not just hospitals. Employers, particularly large employers, have already put considerable time, effort and money into implementing the parts of the law that have already taken effect. And just the possibility that the law will be repealed or substantially changed could present a serious problem.

"It takes a long lead time to execute any policy, so at this point having a lot of uncertainty and policy volatility really works against helping us to move toward solving the problems of the country," said Helen Darling, president of the National Business Group on Health, which represents many of the Fortune 100 corporations.

Plus, says Darling, with the number of uninsured Americans at 50 million and growing, "starting over would make it virtually impossible to make real progress anytime soon."

That's not to say that the health care industry loves the law. No segment of the industry got everything it wanted, and everyone is busy lobbying for something to be changed.

"There are plenty of opportunities for improvement, fine-tuning and actually adding some significant enhancements, especially in controlling costs," Darling says.

The health insurance industry, in fact, wants to make more than just fine-tuning changes. It's been among the most outspoken critics of the measure. But even insurers haven't come out in favor of scrapping the whole law and starting over -- particularly not when it stands to get millions of new customers.

"We're looking forward to working with both parties to minimize coverage disruptions caused by the new law and to make health care coverage more affordable for working families and small businesses," said Robert Zirkelbach, a spokesman for America's Health Insurance Plans.

So are Republicans being abandoned by their usual allies in the business community? Not exactly, says Jonathan Oberlander, who teaches health policy at the University of North Carolina, Chapel Hill.

"Usually we think of the health industry as being in alliance with Republicans and opposing more government intervention in the health care system," Oberlander says. But you have to ask why did the industry support the health reform law in the first place?"

He says the reason is that the more people there were without health insurance, the more that threatened the industry financially. In other words, its entire business model was about to fall apart.

"The health care industry needs paying customers and insured customers to make that business model work," he says. "To the extent that Republicans push repeal, they are threatening the bottom line of the health care industry, and I think they're going to find that many elements of the health care industry are going to oppose repeal."

Many parts of the industry are already spending so much money getting ready for the new law, Oberlander says, "if you're talking about rolling the law back, that's a blow to their future, but it also represents the loss of all the resources they've pumped into it right now in getting ready for it."

All of that leaves Republicans with a dilemma of their own -- please their voters, or please some of their biggest donors. When it comes to health care, they may not be able to do both.