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09/22/2017

Another (Un)Health Care Bill Forced onto Us

tby Craig Klugman, Ph.D.

Americans still tend to think of human rights violations as abridgments of free speech and religion, and extreme crimes against humanity, such as slavery, torture, and arbitrary detention. These are correct, but incomplete. Economic and social rights (which include the right to health, and can be thought of as the core of social justice) are a vital part of a human-rights-based ethical code.George Annas, American Journal of Bioethics (September 2017)

This coming week (probably Wednesday), the GOP Senate leadership plans to bring to a vote yet another health care reform bill, Graham-Cassidy. The bill was written by Lindsey Graham (R-SC), Bill Cassidy (R-LA), Dean Heller (R-NV), and Ron Johnson (R-WI). The bill is being pushed through with minimal debate (some sources say no more than 90 seconds of total debate will be permitted). The reason for such a rush is that under Senate rules, a health care bill passed after September 30 would require 60 votes instead of the current 51 votes. This means that before September 30, the bill can pass without a single Democratic vote. Other factors are more political: one is that the Republicans campaigned on repealing the ACA and so feel they must delivery and the other is one of the largest donors to the GOP said there would be no more money until health and tax reform occur. While the Senate GOP leadership tries to round up the votes on this bill, every state Medicaid director, every health care organization, most Democrats, doctor’s groups, hospital groups, many Republican governors, the insurance industry, the pharmaceutical lobby, and the AMA have all come out against the bill.

This bill repeals most of the Affordable Care Act. This means taxes on high income individuals and on pharmaceutical and medical device companies are cut. The insurance mandate is dropped. The minimal essential coverage rules that require insurance to cover annual exams, women’s health, reproductive services, substance abuse treatment, maternity care, and more become optional: states can choose to waive these “requirements.” The bill allows states to require people to work in order to receive Medicaid. It also cuts the public health fund and prohibits funding Planned Parenthood for 1 year. Although the bill requires states to ensure that people with pre-existing conditions have access to insurance, it does not require any insurer to cover them and provides no limits on what the company may charge. UPDATE: New version would prevent insurers from charging more for pre-existing conditions and would also prohibit lifetime or annual coverage limits. Therefore, having a pre-existing condition can make health insurance unavailable and unaffordable.

The Congressional Budget Office (CBO) will not have a report on this bill completed before the Senate vote. Voting without a CBO score is almost unheard of. The previous two repeal bills considered by the Senate were scored by the CBO as dropping tens of millions of people from health insurance. The Kaiser Family Foundation estimates at this point that under Graham-Cassidy 32 million people would lose their health insurance in the next few years and $160 billion would be cut from the 31 states that expanded Medicaid under the Affordable Care Act. Between 2020 and 2026, this bill cuts health coverage in expansion states by an average of 11%.

Under the ACA, the federal government gave individuals subsidies to help them afford to purchase health insurance. This new bill would remove the subsidies. It basically shifts responsibility for health care from the federal government—which provides subsidies and runs most of the ACA insurance marketplaces—to the states. States would receive block grants based on a per capita cap formula. This calculation would look at each state’s population earning 50-138% of the poverty level and grant them about $4,400 per person ($6,500 in Alaska). UPDATE: Last minute efforts send additional funds to states whose Senators are on the fence about supporting the bill. This is the maximum level of funding, replacing the current open-ended funding system. This approach would save the feds money as over the next 9 years, $215 billion dollars less would be spent on health care/insurance and over the next 20 years, $4 trillion less. However, the states with the highest levels of poverty are mostly found in “red” states, which mostly chose not to participate in the ACA Medicaid expansion. The result is that while expansion states (mostly “blue” states) would lose out, states that rejected ACA expansion (mostly “red” states) would see a 12% increase in their funding from the federal government. For example, from 2020-2026, California stands to lose $78 billion, New York would lose $45 billion and Illinois, $8 billion. On the other hand, Texas would gain $35 billion, Georgia gets $10 billion more, and Alabama, $5 billion. Another way to view this is that states which lean Democrat will lose money and Republican-leaning states will gain or at least lose the least.

The reasoning for this shift in responsibility is that Republicans claim to be in favor of state’s rights, believing that more local control is more efficient and responsive. Theoretically this could mean that a state could take their block grant funds and set up its own single-payer system. California, New York and Vermont have toyed with bills in recent years. However, one GOP Senator plans on offering an amendment that would prohibit any state from creating a single-payer system. Thus, the argument for states’ rights applies only to states that agree with certain Republican Senators. All other states are subject to receiving fewer dollars and having their hands tied.

In addition, the bill actually cuts pre-ACA traditional Medicaid funding by $53 billion for the 2020-2026 period. Medicaid helps the elderly, children, pregnant women, those with disabilities, those with low incomes, as well as rural hospitals and long-term care facilities. For states that will get less Medicaid funding, they will have to make hard choices: (a) raise state taxes to maintain current coverage or (b) triage who will be covered.

Although most provisions would be set to come into effect in 2020, there are a few that would be more immediate. September 27 is the date when insurance companies must file what they will charge in the ACA insurance marketplace for the 2018 year. Since the vote is rumored to be scheduled for that date, this bill will dramatically disturb the marketplace. Insurers have no choice but to base premiums on higher estimates that they would need if Graham-Cassidy passed, meaning that premiums will be going up even if the bill is not passed. In Illinois, insurers have reported looking at raising rates by 16-37% over 2017 premiums meaning a non-smoker in a suburban county in her 20s might see rates go from the current $266 to $338 next year. In addition, Trump’s earlier threat to withhold federal money to pay subsidies has added more chaos to the market (allegedly he will now send the subsidies). The Republicans are creating a self-fulfilling prophecy—without the federal subsidies and a stable climate, rates must rise dramatically, which is a major reason they claim for needing to repeal the ACA.

Hidden inside the bill is another immediate provision: The bill would prohibit using tax credits to purchase in the marketplace any insurance plan that covers abortion. And the bill would deny tax credits to businesses that offer their employees insurance plans that cover abortion. Since the reason most businesses can offer health insurance is that tax credits offset the cost, the effect is that most people will be unable to have insurance that pays for abortion services. This provision would come into effect on January 1, 2018.

Separate from this bill, but equally important, is to note that Congress has not yet renewed the Children’s Health Insurance Program. If not renewed by September 30, nearly 9 million children will suddenly lose their health insurance.

Although the “buzz” is about Graham Cassidy, it is not the only health bill introduced to the Senate. A bipartisan group of Senators had been working to craft a bill that would have stabilized the marketplace and worked to make the ACA better. This effort was abandoned by the GOP leadership in favor of Graham-Cassidy. Senator Bernie Sanders, along with 15 Democrats, introduced a bill to create a system of universal health care by progressively extending Medicare until everyone is covered.

When teaching my students about the definitions of ethics, morality and law, I explain to them that good law comes out of good ethics—a process of critical deliberation examining how people make right and wrong; the science of morality; a conversation about questions. The Senate is having no debate on this bill. There is no process of ethical deliberation on the pros and cons. The reverse of what I teach my students is that without vigorous deliberation, one is likely to have bad law.

 

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