“Make America Great Again” the slogan which we have all been conditioned to associate with President Donald J. Trump and his presidential campaign. Along with this catchy slogan were a series of proposed bills and legislation which would take the nation by storm. One of these controversial bills would be president Trump’s health care reform bill the American Health Care Act (AHCA) nicknamed “Trump Care” this proposed bill would be the antithesis to President Barack H. Obama’s Affordable Care Act (ACA) well known by its nickname “Obama Care” enacted in March 2010 seen to be part of President Obama’s legacy.
The ACA had three primary goals make health insurance affordable and available to more people. Provide consumers with subsidies “premium tax credits” that lower costs for households with incomes between 100% and 400% of the federal poverty level. Expand the Medicaid program to cover all adults with income below 138% of the federal poverty level. Support innovative medical care delivery methods which were designed to lower the costs of health care. The ACA was the largest health care overhaul since the creation of Medicare and Medicaid in 1965 by President Lyndon B. Johnson.
The ACA was widely seen as a step in the right direction although shortcomings did exist. The insurance expansion is projected to cost roughly $1.4 Trillion dollars over the first 10 years after. With the ACA’s implementation between 22 and 32 million additional Americans would receive coverage. This expansion in coverage represents one of the, if not the, greatest achievement of the ACA. The ACA weakened the link between health insurance and employers. In which it combated an IRS ruling from World War II, in which health care premiums, the amount employees contribute from their paychecks for health insurance are tax exempt if employers pay them on your behalf, but not if you buy coverage on your own. This is why an overwhelming majority of privately insured Americans have received their health insurance through their employers.
Economists have criticized this arrangement, because it locks workers into jobs purely to maintain their health insurance coverage. The ACA’s insurance exchanges allow uninsured individuals to buy coverage without having to go through their employers. Additionally, the ACA took steps toward reversing the tax exempt status of employer based health insurance. The so called “Cadillac tax” eliminated the tax exemption on health insurance premiums above a certain threshold. The ACA aimed to lower the price of insurance for the very sick by regulating the health insurance market. The health insurance market mainly works by bringing together a pool of diverse people, charging each of them a premium and using the proceeds to pay for all the care that ends up being needed by the pool of people.
The ACA regulates this process by requiring that insurance companies charge all individuals in the insurance pool the same price, regardless of how likely each one is to need or use their coverage. This regulation is known as “community rating” because the entire community of individuals gets charged the same rate. Without it sicker people would pay higher premiums than healthy people because they cost more to insure. By leveling out premiums for all, community rating ends up lowering insurance prices for the sick but raising them for the healthy. The ACA mandated coverage for both insurers and individuals as a deterrent requiring insurance companies to accept all individuals into a pool, even if they have preexisting conditions. This regulation protects individuals seeking to buy coverage or trying to renew their existing coverage. The other regulation is the “individual mandate” which requires that all individuals including the healthy purchase insurance. Together, these regulations allow the sick to enter an insurance pool with healthy people, and make it harder for the healthy to exit the pool.
The ACA statute contains a number of other provisions including regulations on how insurance companies spend their premiums, what services insurance companies must cover and how Medicare reimburses providers. Trump’s AHCA although being more flexible by removing the insurance mandate would cause greater harm leaving tens of millions of Americans without insurance coverage. Although the ACA is imperfect needing a number of reforms the new bill should focus on making health insurance more attractive to healthy consumers, and making sick consumers more attractive to insurance companies while keeping costs down. With the proposed bill the primary incentive for purchasing health insurance would be the ability to write off the full amount of your insurance premium in your taxes. With this comes greater tax breaks to wealthy Americans who can afford higher cost of health insurance estimated to be a 275 billion dollar tax break while leaving lower income households uninsured or underinsured. The AHCA would also force the elderly and sicker patients to pay 5x’s more for their premiums than younger healthier consumers leading to disproportionate costs for these vulnerable Americans which was previously regulated by the ACA.
The AHCA would defund Planned parenthood The women’s health provider stands to lose about 30 percent of its funding under a provision in the healthcare bill to block it from getting Medicaid reimbursements for one year unless hundreds of its clinics stop offering abortions. The passage of the AHCA in the House represents marks a big, initial victory for conservatives who have sought to undercut the country’s largest abortion provider.
Also on the chopping block would be Medicare and medicaid the AHCA wouldn’t just cut back Medicaid expansion, it would also trim the program as it existed before Obamacare, by capping how much states would be reimbursed for enrollees. The Congressional Budget Office, the nonpartisan agency that calculates the economic effects of legislation, estimates that the net effect of the changes would be 14 million fewer people would be covered by medicaid. Many of whom are also covered by Medicare these people are referred to as “dual eligibles” One Third of all Medicaid spending is for people covered by Medicare which could be disproportionately affected by efforts to cut and cap federal Medicaid financing. Much of the Medicaid spending for low income Medicare beneficiaries is optional for states.
Nearly 72% of dual eligibles who receive full Medicaid benefits are at risk under the AHCA’s funding caps. While Medicare covers physician, hospital, and most other acute care, Medicaid covers some of dual eligibles behavioral health services as well as most of their long term services. Such as nursing home and community based services. Under federal law, many of these services are optional. Leaving these low-income Medicare beneficiaries who qualify for Medicaid are optional beneficiaries who qualify only when they incur long-term care costs that are well in excess of their incomes. Under the new Bill States can drop these optional services and enrollees. A cap on Medicaid funding not only would affect low income Medicare beneficiaries, it also could affect the Medicare program because of the its close ties Medicaid. In example, reducing the availability of Medicaid financed home care services could mean that more dually eligible individuals would likely wind up in the hospital more often leaving Medicare responsible for the increase in costs.
This would apply more strain to the Medicare trust which were said to be stable up to the year 2030 under the ACA while under this new bill would likely see greater instability and exhaustion of resources by the year 2025. While there is still much to be learned about this bill and its fate it is evident that many of the proposed changes would inevitably destabilize healthcare in the U.S. and the steps made towards universal coverage. In conclusion it is my humble opinion that although some changes and reform are necessary to the current ACA it should not be at the hands of the AHCA causing more harm than good.