As a society we have aspirations and ideals that are not embodied in our nation’s daily life but which we none the less strive to grow towards. One of these aspirations is that each American exists on a level playing field – that I have just as much a chance as anyone else to succeed, fulfill my dreams and build a wonderful life. Even though this is an ideal, our civil society has, over the decades, deemed that attaining this ideal is worth striving towards and so there are elements in our society that seek to create a level playing field. Examples of such intended equalizers are free public education for children, public defenders, government regulations as well as social service non-profits, to name a few, and while none of these are perfect at leveling the playing field, they are real world manifestations of our striving towards this level field. As of 2010, the year the ACA became law, access to decent healthcare became one more equalizer within society, one more right, one more push towards attaining the very American notion that every person is created with equal opportunities to thrive.
The newly introduced Republican Party’s healthcare bill, the American Health Care Act, boldly espouses a fundamental Republican belief that healthcare is not a right, that it is not a facet of our society which seeks to level the playing field, but rather that healthcare is a privilege directly connected to your ability to pay.
The big revel of the American Health Care Act (the initials of this bill are AHCA, which is just too close to ACA so I will refer to the AHCA as the Republican bill and will refer to the ACA as the ACA) has not gone as hoped and there already is talk that the bill will not make it into law… yet regardless of this bill’s future, it showcases what the Republican Party believes is acceptable in terms of healthcare. In addition it is important to note that there are numerous bills in Congress which contain individual aspects of the larger bill (for example there is a bill that would eliminate the individual mandate for health insurance).
Two aspects of the Republican bill, which I believe were included to garner public approval, are that the bill would allow young adults to stay on their parents’ healthcare policies until the age of 26 and that the bill retains safeguards for individuals with pre-existing conditions. But upon further examination, it becomes clear that the bill will most likely be unable to ensure these highly popular aspects of the ACA. To be utterly simplistic, the ACA requires every American to have healthcare insurance either through your/your spouse’s employer, the VA, Medicare, Medicaid or the private insurance market. If you do not have insurance then you are penalized with a fine. Since not everyone will receive insurance through their employer or be able to purchase insurance on their own, the ACA created numerous taxes that brought monies into the treasury which were then given to those in monetary need as subsidies. As the premiums on healthcare rose, the subsidies rose too. Due to everyone being in the insurance market, the insurance companies had their risk managed and thus had enough money to provide coverage to those who had prior conditions, to those who were really sick and to the elderly.
Unlike the ACA, the Republican bill does not require anyone – either individual or employer – to have or provide healthcare insurance. Healthcare insurance returns to being a voluntary item, but the drafters of this bill know that in order to provide coverage to those with pre-existing conditions, to those who are sick, the insurance industry needs people to be covered. This is addressed via ‘incentives’, namely that if you let your insurance lapse and then purchase insurance again (say when you get sick), your monthly premium is increased by 30% for the first year (this increase in premium monies are retained by the insurance companies and do not go to the US treasury as the monies received due to the mandate do). Experts believe that the removal of the mandate for healthcare insurance will lead to healthy individuals bailing out on insurance, which would greatly increase the chances that the individual healthcare market will become volatile and risk collapse.
The Republican bill repeals the taxes created by the ACA, which obviously means that there is less money available to the government (some say this equals a loss of $600 billion over 10 years). It should be noted that many of the taxes that would be repealed by the Republican bill go to wealthy Americans (those with incomes over a million per year get an average tax cut of $50,000 per year and those in the top .1% of incomes get an average tax cut of over $195,000 per year). A couple of ‘dominoes fall’ due to the decreased monies the government has to spend on healthcare, namely that the Medicare trust is depleted faster – thus decreasing the lifespan of Medicare as we know it – and subsidies for insurance coverage are ended.
In addition, the Republican bill switches Medicaid from the open-ended expansion system the ACA created (32 states and D.C. participated in expanding their Medicaid programs under the ACA, bringing insurance to roughly 11 – 14 million more people) to a per person allotment system. The current system of a state being allowed to enroll as many people into Medicaid as it needs to ends and the system changes to having a fixed amount of money available for a state to cover its lower income residents with (starting in 2020, a state’s monetary support from the federal government will be reduced by 25% for each quarter that the state has “excess aggregate medical assistance expenditures” i.e. that the state has too many people on Medicaid). There will also be a limit to the monies spent on each person. In order for individuals to receive government supported healthcare they will need to be re-evaluated every 6 months and someone (intentionally or accidentally) who receives supported healthcare but actually exceeds the financial cut-off for such support will receive a $20,000 fine. The obvious outcome of these measures is that fewer individuals, with lower incomes, will receive healthcare insurance.
Rather than provide income based subsidies, and again under the ACA as premiums increase the subsidies increase as well, the Republican bill offers age based tax credits, which are fixed – meaning that regardless of increases in premiums, the tax credit stays the same. The tax credits, which do not exist for the “well-to-do” (defined as a yearly income of $75,000 for an individual or $150,000 for a couple) are as follows: $2,000/year for those under 30 years of age; $2,500/year for those between 30 and 39 years of age; $3,000/year for those 40 to 49 years of age; $3,500/year for those 50 to 59 years of age and $4,000/year for those 60 years or older. Needless to say these monetary amounts – both the cut off incomes and the tax credits make one wonder where the authors of this bill live and whether they have ever bought insurance on the private market or through a not so generous employer. One final item in the Republican bill, which is aimed at ensuring that Americans are able to finance their healthcare insurance, is that limits on how much one can contribute to a health savings account are repealed but as everyone knows the money that goes into such an account is your money to begin with.
Under the ACA everyone was in the insurance market and thus, theoretically at least, the insurance companies had the means to provide insurance to everyone – thus with pre-existing conditions included. However with the Republican bill, if you have a pre-existing condition you only maintain protection if you have continuous coverage, if you have 2 months without insurance then you pay a penalty to the insurance company along with the 30% higher monthly premiums for a year. It is a fact of life that as we age we become more likely to be ill and thus more likely to use our healthcare insurance, this can easily lead to the premiums for older individuals being quite high. The ACA aimed to put a cap on how much older adults could be charged – older adults could not be charged more than 3 times what the plans for younger adults were, with the Republican bill insurers can charge the elderly 5 times more than what they charge younger adults.
An often overlooked but often deeply cherished part of the ACA is that it required healthcare insurance to cover a woman’s birth control. While this bill does not specifically address this, it does remove Medicaid reimbursement and all federal funds for one year from any agency (such as Planned Parenthood) that engages in family planning, reproductive health and abortion services. Due to the ACA provision for healthcare insurance to cover birth control the rate of unwanted pregnancies has been going down and thus the rate of abortions has been decreasing as well, yet somehow agencies that provide family planning, reproductive health services and abortions must be punished.
Finally, even though the Republican healthcare bill is a long one, it is worth scanning and at least reading the bolded categories. In so doing you will find numerous pages dedicated to delineating how big dollar lottery winners who are receiving Medicaid will have to cease receiving federal/state support following the disbursement of their lottery winnings. Of course this makes sense and is a legitimate thing to do, but it manifests an assumption seemingly present throughout this bill – that those who have lower economic means are inherently going to scam, cheat and manipulate. This mindset, the shockingly naïve understanding of just how expensive healthcare & medical costs are (as evidenced by the tax credits) and the genuinely poor policy points all make this bill a terrible idea for our nation.
Sources for this post:
A copy of the American Health Care Act can be found at: http://energycommerce.house.gov/sites/republicans.energycommerce.house.gov/files/documents/AmericanHealthCareAct.pdf