The GOP finally released its proposal to repeal and replace Obamacare. If you want to know what’s in it, House Speaker Paul Ryan (R-WI) tweeted “#ReadTheBill.” Their American Health Care Act (AHCA) is available to download at https://housegop.leadpages.co/healthcare/.
Don’t bother though. Because it’s really a 123-page amendment to Obamacare and the Medicaid section of the Social Security Act. So, you’ll have to read those too. And they don’t expect anyone to do that.
What Ryan’s team really wants is cheerleaders to repeat their talking points.
Among those is the AHCA will keep two of Obamacare’s most popular patient protections. It will remain illegal for insurance companies to deny coverage, or charge more, for preexisting conditions. And young people can remain on their parents’ polices until the age of 26.
I’m not going to speculate how much those provisions contributed to the increase in insurance premiums under Obamacare. But keeping both government interventions is proof that one of their talking points is nonsense. The AHCA will not restore free market management of health care.
They are right that their plan “dismantles the Obamacare taxes.” It’s a simple statement that may be enough to satisfy the GOP’s most loyal supporters. But anyone who thought Donald Trump would fight for the working class might want to ask why he’s allowing the elimination of Obamacare’s $500,000 tax deduction limit for executive salaries of health insurance companies.
Take Aetna. They pay their CEO about $17 million a year. Allowing them to write it all off amounts to a huge windfall for a company that last year reported a net income of almost $3 billion. It was only 7 percent less in 2015. They don’t need a tax cut.
A photo tweeted by Trump suggests this gift was discussed in the White House the day before Trump gave his State of the Union speech. “Great meeting” the caption read, “with CEO’s of leading U.S. health insurance companies who provide great healthcare to the American People.”
Maybe to him it was a great meeting, but his message is definitely wrong. It’s America’s doctors and nurses working in hospitals and clinics who provide us the health care we need. What the insurance companies do is make health care “an unbelievably complex subject,” which is exactly how Trump described it when he spoke to state governors that same day.
Another GOP talking point is they’ll “eliminate the individual and employer mandate penalties”. What they don’t explain is the AHCA imposes a different kind of penalty on anyone who lets their insurance lapse for two months. They’ll be subjected to a 30 percent increase in premiums when they try to get a new policy.
What about allowing health insurers to compete across state lines? After all, Trump reiterated this campaign pledge in his State of the Union. But that’s not part of the AHCA because the GOP is using the budget reconciliation process so Senate Democrats can’t kill the bill with a filibuster. Their talking points redirect readers to an initiative titled “A Better Way.”
But the two short paragraphs on this subject in that report are just more talking points. One of them is they’ll “make it easier for states to enter into interstate compacts,” correctly implying it’s already allowed by Obamacare.
In any case, Obamacare, or the feds for that matter, aren’t the sole problem. Regulating the insurance industry is a states’ rights issue. For instance, if an insurer in Washington or Oregon wants to offer policies in Alaska, they’d have conform to our rules.
The bigger problem for out of state insurers, though, is building a network of doctors and hospitals in Alaska. To negotiate competitive reimbursement rates, they first need a sizable pool of insured Alaskans. And they won’t have that pool without a network. It’s a classic chicken before the egg question.
Forbes columnist Avik Roy believes selling insurance across state lines can work. Never a fan of Obamacare, his well-informed argument ends with telling everyone to be patient. “Policymakers” he wrote, “shouldn’t be ‘dumbfounded’ if interstate insurance doesn’t produce immediate dividends.”
However, whenever money is involved, patience isn’t an American virtue.
Pulitzer Prize-winning journalist Michael Hiltzik argues the idea will never work. He references a Georgetown University study that claims insurers, doctors and hospitals aren’t interested. It’s “only backers” he concludes, “are preening political candidates who don’t understand health insurance.”
And because it’s “an unbelievably complex subject,” most never will understand it. That’s why their talking points, and anyone who repeats them, need to be treated with an extremely heavy dose of skepticism.
