BU Today

Opinion

POV: Senate Republicans’ Health Care Reform Bill Will Hurt Millions

“A cruel and heartless bill”

5

For seven years, Republicans have promised to “repeal and replace” the Affordable Care Act (aka Obamacare), and they may finally be able to do so. We should all worry that they might succeed. They have proposed a cruel and heartless bill that will hurt millions of Americans.

But that may be beside the point for them. Based on the bill’s content, it appears that its main purpose is to provide a massive tax cut for the wealthiest Americans. Reducing health care spending is simply the way chosen to pay for it. Although, incredibly, they call their bill the Better Care Reconciliation Act, it is not primarily a health care bill at all, but a tax bill.

One clue that this is the case is that although their anti-ACA rhetoric has been constant for years, it has never been clear what problems they are trying to solve. They use nonspecific words like “disaster” and avoid detail. If they were serious about health policy, they could propose ways to improve it. Instead, however, they want to repeal a law that although imperfect, has done lots of good for many individuals and families. Since the ACA’s accomplishments are well known—check out the websites of the Commonwealth Fund or the Kaiser Family Foundation—I won’t take my limited space here to repeat them. Suffice it to say that as a result of the ACA, millions more Americans have health insurance, health care costs have risen at the lowest rates in decades, and the law constrains firms that offer the employer-provided insurance that most of us have in ways that prevent them from victimizing us—especially those with preexisting conditions—as they did for years before the ACA was passed.

The largest spending cuts will be to Medicaid, the federal-state program passed in 1965. Not only did the ACA allow states to expand their Medicaid programs to include people with incomes up to 138 percent of poverty, it said the federal government would pay the full cost of that expansion for three years and then at least 90 percent of it after that. In other words, it provided free money to those states that wanted to, first, help their residents, and second, expand their economies (and tax revenues) at the same time. Even with those inducements, however, governors and legislatures in 20 states decided to reject the offer. The reason: political ideology. They don’t believe either that people should have access to needed medical care unless they can pay for it or that government has a role in helping them.

The Republicans’ Senate bill not only would sharply reduce federal support for Medicaid expansion, but also would dramatically change the way the underlying program is funded. From its inception, Medicaid has reimbursed the states for the money they spend on medical care for eligible residents. That allows doctors and patients to make the critical care decisions. Instead, the new bill would apply arbitrary dollar amounts to the care a person could receive. The effect of this change would be to limit the care that eligible Medicaid beneficiaries can receive—even if it is not enough to treat their conditions. In addition, they would forbid using Medicaid money to pay for services provided by Planned Parenthood, even though in some places it is the only source of preventive and other care for women.

One of the few specific complaints Republicans have had about the ACA is that it requires almost all Americans to buy health insurance and requires larger companies to provide affordable coverage to employees—and in both cases imposes penalties on those who fail to comply. Those provisions were included in the ACA so that the risk pools would be as large and diverse as possible and the insurer would have enough money to pay for services used by covered individuals. The Republicans’ Senate bill eliminates the penalties, even though we know from Massachusetts’ Romneycare experience in the ’90s that without penalties, many young, healthy people will decide not to buy coverage. If that happens, the risk pools will not be large enough to pay for the care of those who are covered. In addition, because costs will be higher, those who do buy coverage may not be able to afford insurance that meets their needs.

The fact is, however, everyone needs insurance. While the probability that young people will use care is low, it is not zero. Everyone has some chance of needing services, even expensive ones. Examples: breaking a leg playing ball, being hit by a drunk driver who runs a red light, even developing cancer. Insurance frees them from worry that they can’t afford the care they need.

The bottom line is this: if the Republicans’ Senate bill becomes law, millions of Americans will lose their coverage altogether. For those who get to keep it, it is likely to be more expensive and cover less.

But as I said at the outset, the main reason this bill even exists is to cut the cost of publicly funded medical care in order to reduce taxes on the wealthy. That sounds outrageous to me, but it will happen unless three Republican senators with a conscience or who expect a close reelection race next year vote against it. As of this writing, six have said they oppose the bill, forcing GOP leaders to announce on June 27 that they would delay a vote on the bill until after the Senate’s weeklong July 4 recess. It’s hard to believe, but it might fail because several senators plan to vote against it because it is too generous.

Stephen M. Davidson is a Questrom School of Business professor of markets, public policy, and law and the author of Passage and Implementation of the Affordable Care Act and A New Era in U.S. Health Care: Critical Next Steps Under the Affordable Care Act. He can be reached at sdavidso@bu.edu.

“POV” is an opinion page that provides timely commentaries from students, faculty, and staff on a variety of issues: on-campus, local, state, national, or international. Anyone interested in submitting a piece, which should be about 700 words long, should contact Rich Barlow at barlowr@bu.eduBU Today reserves the right to reject or edit submissions. The views expressed are solely those of the author and are not intended to represent the views of Boston University.

5 Comments

5 Comments on POV: Senate Republicans’ Health Care Reform Bill Will Hurt Millions

  • Bob on 06.28.2017 at 7:20 am

    Several years ago, my wife and I owned a small business in Massachusetts. One year our health insurance increased by 82%. My and my wife’s health had not changed. We had not gotten sick or had an accident. The cause of the cost increase to just over $1,800 per month was age, I turned 50. We could not afford the additional $800 per month for health insurance. We had a choice, pay for health insurance or eat and have a roof over our heads.
    We struggled along for a short time, then made the conscious decision to drop health insurance coverage and pay the health penalty cost to the state. We paid for our health care ourselves and if we got very ill we would close the small business, file bankruptcy, collect welfare and go on Medicaid. That was our health plan, and I am glad we never got sick to enough have to use it.
    Eventually, we closed the business and went to work for someone else, and they now cover most of the health cost.
    The ACA has problems that must be addressed. It should not be replaced, but it should be adjusted to fix some of the short comings. We need to look at the way other countries do it and use the best parts of the way they have done it.

  • Bob m on 06.28.2017 at 12:36 pm

    I think you need to talk to more average people. The ACA was a huge tax hike for many. I talked to one family self employed with four children. His healthcare insurance went to $28,000 a year with a $10,000 deductible. So $38,000 before insurance kicks in. Plus he gets to pay the ACA tax on income.
    Next example a friend from work had a father who is retired go on the ACA plan after his company dropped his insurance. The ACA notified him his medication for pulmonary disease was not covered. He could not afford to pay it out of pocket. While fighting it he spiraled down and died in six months.
    I could go on but this plan hurt a lot of people in many ways.

    • S on 06.29.2017 at 3:24 pm

      I think a big part of the problem is that the vast majority of Americans were mislead (or don’t care to learn) about what the ACA does and what it doesn’t do. For example, Bob m above thinks “the ACA” notified someone that their medicine wasn’t covered. He also seems to think that poor working class people were taxed heavily by the ACA.

      • Andrew Wolfe on 07.06.2017 at 1:06 pm

        It’s pretty clear to me that Bob M meant the ACA Plan notified the person, not the ACA itself. And I’ve seen a lot of this myself. Many expensive tests and treatments covered by my 2009 insurance are no longer covered by my 2017 – and I believe I have one of the better plans.

  • Andrew Wolfe on 07.06.2017 at 1:27 pm

    I am very disappointed by the class warfare tone of this article. Wealthy Americans were nowhere near as damaged by ACA as the middle class, nor are they going to benefit greatly from AHCA. That’s simply partisan demagoguery. And if I had a dime for every time I heard about “the rich this, the rich that…” Big-government people suggest “the rich” are the so-called “one-percenters,” but when they levy taxes on “the rich” it turns out the middle class carries the brunt.

    ACA is just a plain failure, the latest government intervention that limits access to health care and reduces the quality of the health care that is there. Mandating health insurance is one way ACA has claimed victory, but that victory is a complete illusion. The ACA has caused private insurers to gut their coverage, raise premiums and deductibles, or abandon entire markets. It has driven out many doctors as well, leading to a provider shortage. It takes a lot of gall to look at middle-class families crushed by four years of insurance hikes and claim that ACA has reduced health care costs, or families that travel 150 miles to find a doctor and hospital, and claim ACA has extended health care. It hasn’t.

Post Your Comment

(never shown)