Here’s the quick take away from the nonpartisan analysis of the Republican plan to replace the Affordable Care Act: If you are old and poor, your insurance premiums will increase — a lot.
This is because the American Health Care Act, which was approved by Republicans in the U.S. House of Representatives earlier this month, allows states to opt out of current requirements that insurance companies cover “essential health benefits,” such as preventive care, prescription drugs, hospitalization and maternity care. States could also allow insurance companies to base rates on health status, thereby charging more to someone with pre-existing conditions. Republicans added a provision to the bill that would set up a separate pool for older, sicker Americans. But, the bill grossly underfunds this “high-risk pool.”
Given this, “premiums would vary significantly according to health status and the types of benefits provided, and less healthy people would face extremely high premiums, despite the additional funding that would be available under H.R. 1628 to help reduce premiums,” the CBO concluded. “Over time, it would become more difficult for less healthy people (including people with preexisting medical conditions) in those states to purchase insurance because their premiums would continue to increase rapidly. As a result of the narrower scope of covered benefits and the difficulty less healthy people would face purchasing insurance, average premiums for people who did purchase insurance would generally be lower than in other states — but the variation around that average would be very large.”
As a result, a 64-year-old with an annual income of $26,500 would see premiums rise in the individual market from $1,700 under current law to $13,600 under the Republican plan with eased state regulation — an eightfold increase.
Because fewer people will be able to afford insurance, fewer will have it. The CBO estimates that 18 million fewer people would have insurance next year and 23 million fewer people will be covered by health insurance in 2026 than if the ACA remained in place.
Beyond changes to the individual market, which was the focus of the ACA, the GOP plan weakens employer-provided insurance. It caps Medicaid spending, which will harm the poor, disabled students and people struggling with substance use disorder. It temporarily bars Planned Parenthood from participating in Medicaid, cutting poor women off from care.
Republicans are pleased that their plan is projected to lower the deficit, by $119 billion over the next decade. However, the deficit could have been reduced by nearly 10 times that amount if the bill wasn’t packed with tax breaks unrelated to health care, which will reduce federal revenues by more than $990 billion over the next decade, the CBO calculated.
The Republican plan appears doomed in the Senate, where a handful of Republicans, including Sen. Susan Collins, have expressed serious concerns about it.
“The goal of any ACA replacement should be to improve access to quality health care while providing consumers with more choices and restraining costs,” Collins said in a statement. “Unfortunately, the CBO estimates that 23 million Americans would lose insurance coverage over the next decade, and the impact would disproportionately affect older, low-income Americans.”
She urged her colleagues to support legislation that she and Sen. Bill Cassidy, a Republican from Louisiana, have written. Their bill is far from perfect — it too gives states a lot of control over which insurance plans are offered, but it keeps protections for those with pre-existing conditions. It is a better starting point for discussion in the Senate than the cruel and misguided Republican House bill. An even better starting point would be to fix the flaws in the Affordable Care Act rather than tossing it aside.
The CBO confirms that the House GOP plan would be a disaster for many Americans, especially older, rural Mainers.