Republicans Target Our Health Insurance

The Affordable Care Act known as Obamacare is a very complex law that has numerous taxes, regulations and government subsidies, all of which Republicans hate.  In fact the vast majority of them want to simply repeal the law.  But political pressure from 20+ million Americans who would lose coverage without Obamacare caused them to come up with a replacement.

So last Monday House Republicans rolled out their American Health Care Act (AHCA).  The House and Senate conservatives who oppose it call it “Obamacare-lite.”

The GOP leadership is rushing the AHCA through Congress before the Congressional Budget Office has determined its cost and its effect on the number of individuals insured.  Of course the more people who are insured, the cheaper insurance is for everybody.  That was the whole idea behind Obamacare.  So I was eager to analyze how the GOP plan differs from Obamacare and here is what I discovered:

Individual and Employer Mandates – The AHCA repeals Obamacare’s mandates and its penalties for not having health insurance.  This will cause some younger, healthier individuals to exit the market.

Subsidies for out-of-pocket expenses – In 2020 the AHCA repeals Obamacare’s cost-sharing assistance that helps low income families pay deductibles and co-payments.  This increase in out-of-pocket costs could make their policies unaffordable.

Premium subsidies – Obamacare provides tax credits to middle-income Americans on a sliding scale to help pay premiums.  These credits are based on income, age and local health insurance costs.  The AHCA uses age instead of income to grant a flat tax credit amount for individuals earning less than $75,000 and households earning less than $150,000.  A person under 30 would receive a maximum subsidy of $2,000, a person age 40 would receive $3,000 and those over 60 would receive $4,000.

These less generous subsidies based solely on age will no doubt reduce the number of participants in the health insurance market.  And they will penalize older, poorer individuals in high premium markets.  According to the Kaiser Family Foundation’s interactive map, in 2020 a person in Henderson County, NC aged 60, earning $30,000 per year, would lose $10,160 in tax credits under the AHCA.  While the same 60 year old in states like Washington and Massachusetts might lose less than $1,000 in many cases.

Medicaid expansion – Obamacare expanded Medicaid to include some 11 million people in 31 states.  The AHCA would keep Medicaid expansion and continue federal funding as promised under Obamacare for two more years.  Then in 2020 it would cap federal funding per Medicaid enrollee based on state Medicaid spending in fiscal year 2016, with inflation adjustments thereafter.

According to the Center on Budget and Policy Priorities the AHCA formula will shift $370 billion of Medicaid’s costs to the states over the next 10 years.  Some states may have to ration care, perhaps having to decide on who lives and who dies.  Nursing homes and hospitals with emergency rooms would no doubt suffer significant revenue loss.

Tax-Free Health savings accounts – The AHCA would almost double contribution limits in 2018 to $6,550 for an individual and $13,100 for a family.  But those who need this law probably can’t afford these contributions and may not even pay much in taxes.

Older Americans pay higher premiums – Obamacare allows insurers to charge older insureds three times more than younger insureds.  The AHCA allows five times more.  This provision will no doubt price many seniors out of the market.

Other provisions in both Obamacare and AHCA – Obamacare and AHCA both require insurers to accept those with preexisting conditions, allow young adults to stay on their parents’ plan until age 26, require insurers to offer 10 essential health benefits and prohibit caps on annual and lifetime coverage limits.

Obamacare taxes – The AHCA repeals most of the tax provisions in Obamacare that were designed to help offset the cost of providing subsidies to lower income individuals.  The Joint Committee on Taxation in Congress has estimated that this repeal will reduce federal revenues by almost $600 billion over 10 years.  So seniors get higher premiums; the wealthy get lower taxes.

Planned Parenthood and Abortions – For one year the AHCA prohibits funding to organizations that primarily provide reproductive health care, which will effectively defund Planned Parenthood.  It also prohibits beneficiaries from using subsidies to purchase insurance that covers abortions except in the case of rape, incest, or life-threatening complications.

The American Medical Association has called the AHCA “critically flawed” and it is opposed by the AARP.  Major physician’s groups have said they have serious issues with or outright oppose the plan.  But I don’t think most Republicans are worried about opposition from health care organizations.  The Koch brothers and various right-wing groups also oppose their replacement bill and that’s who they fear the most.

Republican controlled states are among the poorest in the nation and have the most to lose with an Obamacare replacement.  And President Donald Trump’s promise that “his” Obamacare replacement will be better, cheaper and cover everybody certainly won’t be fulfilled by the AHCA.  Yet I wonder if low and middle-income Trump supporters and Republican voters even realize how badly this law will hurt them.

President Harry Truman probably said it best:  “How many times do you have to get hit over the head until you figure out who’s hitting you.”  Of course he was referring to Republicans.

Note:  Click on the link interactive map above to determine tax credit differences in other state counties.

About eeldav

I am a retired corporate attorney who has lived in both Europe and Asia. While working my responsibilities took me to over 40 countries in Europe, the Middle East, Africa and Asia.
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7 Responses to Republicans Target Our Health Insurance

  1. Philip Rakita says:

    My local congressman is Mark Meadows (R-NC 11th). I have already written him inviting him to rename the Freedom Caucus version as “Meadowscare”, better printed as MeadowScare since the consequences are truly frightening.

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  2. Sue Ellen says:

    Thanks for explaining this so eloquently; I get nothing out of listening to the news as there are no real examples only one politician after another telling me why it is so great while another says the exact opposite. All in all, it sounds like a big loose/loose for everyone.

    Like

  3. Joe Weigner says:

    Thanks for such a thorough analysis of the new AHCA act.  I’ll definitely pass it on to others.  I’m grateful to be on Medicare (until they start messing with that) but know my kids will pay the price for any new changes passed by the Republicans. 

    When we moved to NC from KY over ten years ago, I had just gone on Medicare and my husband was only 64.  Silly us – we thought we could just transfer our Blue Cross/Blue Shield health insurance to here.  Not so.  We found out his premiums would go from $350 a month (no prescription insurance) to $2500 a month for less coverage.   Their reason was because he was on blood pressure meds.  Of course – we couldn’t afford the insurance so he got a job at Home Depot to get medical insurance coverage until he went on Medicare.  So – if any older folks think health insurance will be affordable for them – they’re in for a shock.  Insurance companies don’t want to insure older people and if they’re allowed to raise the rates at will, of course they will!   Scary times we live in! Judy Weigner

    From: From the Center To: weignerj@bellsouth.net Sent: Friday, March 10, 2017 5:31 PM Subject: [New post] Republicans Target Our Health Insurance #yiv5800898250 a:hover {color:red;}#yiv5800898250 a {text-decoration:none;color:#0088cc;}#yiv5800898250 a.yiv5800898250primaryactionlink:link, #yiv5800898250 a.yiv5800898250primaryactionlink:visited {background-color:#2585B2;color:#fff;}#yiv5800898250 a.yiv5800898250primaryactionlink:hover, #yiv5800898250 a.yiv5800898250primaryactionlink:active {background-color:#11729E;color:#fff;}#yiv5800898250 WordPress.com | eeldav posted: “The Affordable Care Act known as Obamacare is a very complex law that has numerous taxes, regulations and government subsidies, all of which Republicans hate.  In fact the vast majority of them want to simply repeal the law.  But political pressure from 2” | |

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  4. Jan Partin says:

    Ron, this is very helpful!!

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  5. Ken Walker says:

    It is early days yet in the Health Care debate. However, the House is rushing along so as to avoid people getting much chance to understand what is happening. It is not clear how those who are upset with this proposal will make their voices heard. The Republicans seem not to want to listen to their constituents, only the party leadership. Ideology is driving the nature of this issue and not what will benefit voters.The folks in favor of this proposal also support the insurance companies, the drug companies and other big Republican campaign contributors. I can only hope a “grass roots” letter, email, Facebook,Twitter and Instagram communication blitz to Washington will turn this anti-citizen avalanche around. Tell everyone who will be victimized by “Obama Care Lite” to contact their Representative/Senator in Washington and make sure they understand you are watching what they are doing to you and your family. Unless and until Congress does something to limit the cost increases of health care and the cost of health insurance, more and more citizens will have to drop coverage. Wages and salaries have simply fallen too far behind for most families to pay current health care and health insurance costs.

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  6. Pierre Hart says:

    How long will it take the United States to join the rest of the modern world by adopting a single payer health insurance system? Endless tinkering with multiple insurance companies simply means multiple bureaucracies, all of which add to the administrative costs. Health care is expensive and we need to eliminate the needless middlemen.

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  7. Paul Klemt says:

    Thanks for the jaw-dropping information on ACA repeal and “replace” – it’s more like a reverse Robinhood policy of taking money from the poor and giving it to the rich. As Savannah Guthrie told HHS Secretary Tom Price on the “Today” show this week, “access” to health care is meaningless if it’s unaffordable, using the analogy of a person who earns $25,000 annually merely having “access” (i.e., technically being allowed to buy one by law) to purchase a brand-new BMW he or she could never afford.

    I checked the interactive map you referred to, and it says my tax credit will decrease by a whopping 72% in 2020. I’m already starting to ration my prescriptions in anticipation.

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