by Craig Klugman, Ph.D.
Whatever one may think of the Affordable Care Act (ACA), it began with noble intentions. The ACA was built on a philosophy of providing more people not only with access to health insurance but also with assistance to pay for it. The goal was not to derive a right to health care for all Americans, but rather to provide a level playing field for all people to purchase health insurance. Toward that aim, the ACA made some tough calls—requiring insurance for everyone so that the payments of the young and healthy would subsidize the needs of the ill whose ranks in the insurance pools were likely to grow.
The philosophy behind the new GOP plan is harder to pin down. Although they claim that the goal is to increase choice (autonomy) and decrease cost, it seems to be based on nothing more than repealing Obamacare. Even the call for autonomy is not for all people, only some and there is no notion of justice in this plan.
First, there are a number of parts of the ACA that people liked and which would be maintained under GOPCare.
- Young adults can stay on their parents insurance until age26
- Insurance companies cannot refuse to cover people because of pre-existing conditions
- The Marketplace exchanges can still exist, but because of the loss of subsidies and taxes, they may be untenable in a year
- The subsidies to help those in lower socioeconomic brackets to purchase insurance become tax credits
And something new: Even though the mandate to purchase insurance is revoked, if you have a lapse in your insurance, you will pay a 30% penalty to buy a new policy.
Second, what will happen to people who gained insurance on the ACA? In the best case scenario, 10 million will lose coverage. In the worst case, 32 million people will lose it. Some accountings include people in the marketplace with subsidies; some include people with Medicaid from the ACA expansion. We must also remember that the ACA also mandated that employers ensure their workers had insurance and many companies offered insurance because it was required. Many of those companies may stop when no longer required to offer health insurance.
This is wrong. There is no other way to say. Although health care and health insurance are not rights in the U.S. (unless you are a prisoner), the notion that people would lose their insurance coverage for political expediency violates every notion of ethics whether looking at the issue form principlism, deontology, utilitarianism, ethic of care or the Golden Rule.
Third, the proposed system is likely to collapse of its own financial weight. Although the Congressional Budget Office (CBO) has not yet come out with the cost/savings for this new plan, in 2015, the CBO reported that repeal of the ACA would cost $350 billion over 10 years. This number does include the cost of more people using the emergency room because they do not have funds to make regular doctor visits or to buy medications. They will visit the ER because they cannot be turned away and when they go, they will be sicker. We know this because it was this way before the ACA.
Penalties for individuals and employers not having/providing insurance are eliminated. There is no penalty for not having insurance starting immediately. People could suddenly stop paying their premiums in the marketplace, which would have the effect of pulling out large amounts of money, especially since those who leave are likely to be the healthy—those who support the ill. But if they want to rejoin later (like when they are sick), it’s that 30% penalty.
The system becomes financially untenable. The mandate for everyone (especially the young and healthy) to purchase insurance, taxes on high-income (Cadillac) plans, as well as on drug and device manufacturers are withdrawn under GOPCare. Who benefits from these cuts? Those who make more than $200,000 per year ($250,000 for a couple) and corporations are the sole beneficiaries. In addition, the money that was collected under the ACA to cover the marketplace subsidies will also disappear. According to the Brookings Institute, without these taxes and financial sources, no replacement is possible. Either the feds will have to find other sources of revenue or subsidy/tax credit money will no longer exist.
Fourth, GOPCare plays politics with our health choices. Under the new plans, there is no funding for any insurance plan that covers abortion. This means no funding for Planned Parenthood; no tax breaks for your employer if your work plan covers abortion. The result is that abortion will effectively not be covered on any plan. Your employer only includes insurance as a benefit because of the tax breaks she or he gets for offering coverage, so she is not going to offer insurance if that break goes away. Or she or he will have to choose a plan that does not cover abortion to keep the tax benefits. Insurance companies could choose offer individual plans that cover the procedure, could offer abortion insurance, or abortion becomes available only to those who can pay out of pocket. This will affect those of lower socioeconomic levels more than higher ones because the wealthier can always pay out of pocket. The plan violates notions of justice.
The ACA had several requirements for insurance plans to cover such as hospitalization, reproductive services, and mental health. All of these requirements would repealed as of December 31, 2019.
Fifth, the cost of insurance to the patient goes up. The ACA income-based subsidies to purchase insurance on the marketplace would be replaced with age-based tax credits to buy insurance. Under the ACA people with greater socioeconomic need (between 100 and 400 percent (about $96,000 for a family of four) of federal poverty level) received more assistance for premiums, deductible and co-pays. That law limited cost of insurance to no more than 10% of income for certain socioeconomic groups. The subsidies averaged $3500 per year with no legislative upper limit. Under the new plan, older people receive more money than younger people with a limit of $4,000 per individual and a family limit of $14,000 per year up to $75,000 individual/$150,000 for families annual income. So a 60-year-old manager has a higher subsidy ($4000 for those over 60) than a 22-year-old barista ($2000 for those under 30).
The response to concerns that people won’t be able to afford health insurance is that they will need to prioritize it in their spending. House Oversight Committee Chairman Jason Chaffetz said, “And so maybe rather than getting that new iPhone that they just love and they want to go spend hundreds of dollars on that, maybe they should invest in their own health care.” This comment draws on a wrong belief that people choose not to have insurance, not that they can’t afford it; that not having insurance is a choice. That is not the case in most circumstances.
The “alternative” that the new law offers for the subsidies are expanded health savings accounts, which are tax free withdrawals from your paycheck that can be used to pay health care costs. The new plan doubles the amount of money you can put into such a plan as existed previously. However, there is a caveat—you can only have an HSA if you have a high deductible health plan—meaning major medical. You’ll have to pay for most doctors visits and drugs out of pocket. Another problem is that if you live paycheck-to-paycheck, you can’t afford to pull out this kind of money, nor will you make enough to take advantage of tax credits (it doesn’t pay to itemize your credits unless you make above a certain level).
For those who found themselves covered under the ACA because of the Medicaid expansion, that benefit would end Dec. 31, 2019. In fact, Medicaid moves from being a federal-state partnership program with matching dollars, to a block grant program where the feds give a certain amount of money to the states, which then decide how that will be distributed in their state. The result will be less money available to all Medicaid programs.
These payments models would seem to violate John Rawl’s maximin principle. This idea states that a policy can benefit everyone, but the greatest benefit should go to those with the greatest need. The GOPCare proposal does the opposite—it provides the greatest benefit to those with the least need—the upper socioeconomic bracket. The new plan violates the notion of justice as fairness.
Fifth, the new plan decreases the ability of the federal government to protect public health. The ACA created a prevention fund for public health programs, especially the CDC, of $1billion per year. That plan is cut under the new proposal.
Sixth, there is not a lot of support for this plan. On the Democratic side there has been a lot of quiet, but general Democrats are outraged about people losing their health insurance. The Center for American Progress sees that the plan as stated leaves a huge financial hole to pay for care, cuts Medicare and Medicaid, and provides tax cuts only for the wealthy.
But many Republicans also do not support this plan. The Heritage Foundation wants repeal without replace. FreedomWorks calls this plan, “Obamacare-lite” (this is supposed to be an insult). They view the tax credits as a new “entitlement” and that the 30 percent penalty for not having continuous care is, in their minds, a mandate. Club for Growth sees the plan as “government-run health care.” They would like to see a free market where insurance can be sold across state lines. The Cato Institute also uses the term “Obamacare-Lite” and sees this “partial repeal” as “the road to single payer.”
One of the principles of public health ethics is the notion of solidarity–that we are all in this together and the community needs to work toward reducing morbidity and mortality for everyone. It’s a concept that puts the community first. The new plan violates solidarity. Instead of a sense of community, it fosters a notion that everyone is in this alone and you get only what you pay for. It is the antithesis of a humane, altruistic outlook and reduces life to a commodity.