The Takeaway: Problems With The House Republican ACA Replace “Plan”? Let Me Count The Ways
After six-plus years of rhetoric and sixty-some repeal votes, the House Republican caucus finally produced a document they refer to as a plan to replace the Affordable Care Act. (To call the plan disappointing would be an understatement. Despite my low expectations, the document the Republican working group produced was even worse than I thought it would be.)
It is a paltry effort. Six of the document’s 37 pages are essentially devoid of content. Much of the remainder is taken up with political bombast full of misleading and flat out untrue statements. The actual policy proposals it does contain, when it pauses for breath from excoriating the ACA, are a warmed over rehash of the same harmful, unworkable ideas various Republican lawmakers have been pushing for years with nearly all of the critical details missing. Although the lack of detail makes any precise comparison to the ACA impossible, it is safe to say that if adopted, the proposals released this week would cause millions of people to lose their health insurance, and increase health care costs for millions more.
It’s not worth the time to read, let alone to write a correction of every misstatement and deconstruction of every bad idea, but here are some of the “highlights.”
Undermines critical insurance reforms while shifting costs to lower-income people and benefits to the affluent
A few of the ACA insurance reforms would remain, such as allowing young adults to stay on their parents’ plan and no lifetime benefit cap. However, most reforms would likely be swept away, such as access to preventive services with no cost sharing. There would be no guaranteed minimum benefit package, and tax credits would not adjust with income, so lower-income people would be less able to afford coverage. Many would drop out of the insurance pool since the individual mandate would also be repealed. Credits would not adjust to keep pace with the rising cost of insurance, so every year fewer and fewer people would be able to afford coverage.
The Republican “plan” would also make shopping for coverage much more difficult. There would be no plan standardization. Competing “private exchanges” would be allowed, each of which might have a different set of insurers and benefit designs. Making “apples – to – apples” comparisons would become almost impossible.
At the same time tax credits for low-income people are wiped out, Republican lawmakers would double down on high deductible health plans and Health Savings Accounts (HSAs) by increasing the amounts that could be contributed to HSAs. This change primarily benefits those in higher tax brackets who also have the spare cash to put into their accounts.
Would cause millions to lose Medicaid coverage and increase financial barriers for those that remain. Children, in particular, could lose vital protections.
Apparently, the drafters couldn’t decide between a Medicaid block grant and a Medicaid per capita cap, so they included both ideas and would let states decide. Either way, beneficiaries would lose. Federal contributions would not keep up with health care costs, and states could for the first time create enrollment caps or waiting lists to exclude otherwise eligible beneficiaries from coverage. Financial protections would be scaled back allowing states to impose higher premiums on beneficiaries that would force many to drop coverage. Those who remain could also get fewer services and pay more in cost sharing. If states chose a block grant instead of a per capita cap, beneficiaries would fare even worse, especially children, who would lose nearly all of the current legal protections that ensure low-income children have a comprehensive benefit package with no cost sharing.
With more and more costs shifted onto states, and with states having more freedom to shift costs onto beneficiaries or exclude currently eligible people altogether, there is little doubt that millions would be harmed.
Erodes benefits and increases costs for Medicare beneficiaries
Repeal of the ACA would immediately increase prescription drug costs for Medicare beneficiaries by eliminating the expansion of the Medicare drug benefit. Most beneficiaries (those who didn’t go to the hospital in a given year) would also see higher out-of-pocket costs through a new deductible structure that would increase the amount they would have to pay for most services before Medicare kicked in. The Republican work group also proposes increasing the Medicare eligibility age, an idea that CBO has determined does not save much money for the federal government but does increase costs for employers and individuals.
But wait, there’s more. Starting in 2024 Medicare beneficiaries would lose guaranteed access to a defined benefit package. Instead, they would be given a set amount of money they could put toward a plan. While the details are lacking, one thing that is clear from the document is the size of this payment would shrink over time relative to the cost of health care, leaving seniors and people with disabilities with ever skimpier coverage.
And now for the good news (sort of)
The ideas contained in this grab bag of horribles are wildly unpopular, and an attempt to enact them would provoke a huge backlash. Even in the event of a Trump election this doesn’t represent where actual health policy would go, since under any conceivable scenario Republicans would not have enough votes to pass a bill like this. Moreover, not all of these changes could be made via budget reconciliation. That said, and despite all the missing detail, this compendium of “greatest hits” creates a chilling picture of where health care could be heading depending on what happens this November.