The Horror Show That Is the Republican Health Care Plan

The Senate bill came out of hiding on Thursday, promising big gifts to the rich: It would cut taxes on investment income (retroactively), wages above $200,000, medical devices, prescription drugs and indoor tanning. It also eliminates penalties for large employers’ failure to provide employees with health insurance and, though a minor amount of money in the big giveaway, eliminates the dollar penalty for individuals who don’t carry heath insurance. (Instead, such people would be penalized by having to go without insurance for 63 days when they try to buy it.)

To pay for these tax cuts for the rich, Medicaid would be cut by trillions. This will hit the elderly, disabled, children, and pregnant women hardest. 59% of residents of Arizona nursing homes depend on Medicaid. Cleverly, the cuts would not hit until 2021 — two election cycles away. But, subsidies for those purchasing insurance on the ACA exchanges will be cut in 2019 — only one election cycle away. Those subsidy cuts hit fewer voters than the Medicaid cuts. Deductibles and co-pays will increase.

If you’re over 50, fasten your seat belts for premium increases. Insurance companies will be allowed to charge older Americans (not old enough yet for Medicare) five times what they charge younger ones.

The Senate bill preserves the requirement that insurers offer the ten essential health benefits required by the ACA. BUT, states may apply for waivers from this rule. Thus, insurance company lobbyists will be hitting on state insurance commissioners to again create a nationwide checkerboard of coverage. Your maternity care or mental health care may be covered in New Mexico, but not in Arizona.

The bill claims to preserve the requirement that insurance companies cannot discriminate based on pre-existing conditions, but the same state waivers will be available so you may be able to buy insurance but your condition could be excluded from the coverage you are allowed to buy. (This is Orwellian.)

Children may stay on their parents’ policies until age 26, just as under the ACA. If they can afford it.

People with the ability to save can put lots more money into their health savings accounts.

Source for all of the above: New York Times, June 22.

Republicans know how to repair Obamacare, at least in the short range. It’s in their bill: Fund the Affordable Care Act’s cost-sharing subsidies and put in place a “four-year reinsurance program to help states stabilize their marketplaces.” That might not be a long-term solution, but it is the answer to the breakdown of the exchanges. They could do this without defunding health care for the poor if they weren’t hell-bent on grabbing the money from Medicaid for tax cuts.

Source: Washington Post, June 22.

And what about the opioid crisis? As Senate Republicans were drafting the bill, two Republicans, Ohio’s Rob Portman and West Virginia’s Shelley Moore Capito, requested $45 billion over 10 years to address the opioid epidemic. But the Senate bill offers just $2 billion, in 2018 alone, for mental health and substance and treatment. The funding amounts to “a joke,” says Richard Frank, a Harvard health economics professor. Frank estimates that it would cost $183 billion over ten years to cover the cost of opioid addiction treatment and the illnesses that frequently come along with it (like hepatitis C and HIV)  for those who would lose coverage if Obamacare is repealed.

Source: Mother Jones, June 22.

The Republican bill would fundamentally change the structure of Medicaid, which provides insurance to 74 million disabled or poor Americans, including nearly 40 percent of all children. Instead of open-ended payments keyed to healthcare costs, the federal government would give states a maximum payment for nearly every individual enrolled in the program. The Senate version would increase the allotment every year by a formula that is expected to grow substantially more slowly than the average increase in medical costs.

Source: New York Times, June 22.

By the way, Big Pharma is sitting on the sidelines in the healthcare fight. There is good and bad in the Senate bill for them.

On the one hand, the bill proposes eliminating a tax, which Moody’s Investors Service estimates would cost drug companies $2.7 billion next year. But other provisions that could drop millions of people from the rolls of insured or increase their out-of-pocket expenses could hurt sales, since there would be fewer people able to afford medicines.

Rolling back Medicaid coverage alone could hit drug sales. The government health-insurance program for the poor, though it gets a discount on the price of prescription medicines, is responsible for 10% of U.S. spending on drugs, according to Moody’s.

“A significant reduction in federal Medicaid funding would negatively impact pharmaceutical volumes and prices as states seek ways to curb Medicaid spending,” Moody’s Senior Vice President Michael Levesque said.

Source: Wall Street Journal, June 22.

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