By Grace-Marie Turner and Doug Badger
Democrats will rally on the steps of the Capitol on Wednesday to “save ObamaCare,” but they might want to re-think what is really best for their constituents.
Former Vice President Joe Biden is expected to join House Minority Leader Nancy Pelosi (D-Calif.) and other House Democrats outside the Capitol for the rally, which will be held one day before House Republicans vote to repeal and replace the health law.
In fact, ObamaCare is collapsing. Without the legislation that Congress is considering, millions of people will lose their coverage. Even more insurers will head for the exits, likely leaving millions of people around the country with the promise of tax subsidies but no insurer in their areas offering policies.
The exchanges are in crisis, consumers are struggling with rising premiums and cost-sharing requirements, and people on Medicaid are forced into a system that provides substandard care at best.
Despite the Congressional Budget Office’s foreboding numbers about the number of people who would “lose coverage” under the House bill, the American Health Care Act, millions of people would lose coverage next year if legislative action is not taken.
CBO assumes that 4 million people will lose coverage this year and 14 million next year if the AHCA is enacted. But that’s not because of the coverage provisions in the law aren’t generous enough but largely because CBO believes that millions of people will simply drop their insurance when the individual mandate penalties are repealed.
In other words, CBO ascribes near magical powers to the individual mandate in forcing people into policies.
It is vital for Congress to act quickly to protect from the collapse of ObamaCare and from the CBO’s misguided assumptions.
ObamaCare’s onerous rules have driven up the cost of policies so that millions of people are choosing to forgo coverage. Nearly 23.5 million people who are subject to the individual mandate haven’t bought policies. Most have received waivers, but 6.5 million paid the penalty in 2015 rather than buy policies they felt were too expensive or just not worth the money.
Most of the dropouts have been the young, healthy people we most need to balance the insurance pools. The House bill would try to draw them back in two ways: First, by allowing states to adjust the age bands to 5 to 1 rather than the current punitive 3 to 1 to make premiums better reflect health care consumption. And second, by providing age-adjusted subsidies to help people purchase coverage.
The House bill provides credits that would vary from $2,000 to $4,000 per person, depending on the age of people in the household. It would phase out for individuals with incomes above $75,000 ($150,000 for joint filers). The credit would be refundable, advanceable, and available to each person in a household.
The House also is considering changes that would make the subsidies more generous to people in their 50s and early 60s. Under the current draft of the bill, a 50-year-old couple with a teenage dependent would get a credit of $9,000 toward the purchase of health insurance. (The maximum credit for a household would be $14,000.) In a more competitive market for health insurance where states can approve a wider variety of health plans, people will have more choices of more affordable policies than under the ACA, attracting them into coverage rather than a failed attempt to force them to buy.
The bill would protect Medicaid coverage. House, Senate, and White House leaders have met extensively with governors to help shape the legislation in a way that will improve Medicaid over the future by giving states more control over the programs to provide greater access to actual care.
As it is, states spend far too much time jumping through Washington’s regulatory hoops to draw down Medicaid dollars. The House bill would preserve Medicaid expansion, but it would give states more options going forward to take care of their most vulnerable citizens.
Too many states put these more vulnerable citizens on waiting lists while aggressively working to enroll able-bodied adults in Medicaid to get the 95% federal matching money that the ACA provides for this expansion population.
The AHCA would continue to cover both categories of Medicaid beneficiaries, but would phase out the payment differential, beginning in 2020. States will continue to receive the elevated federal match for able-bodied adults who enroll prior to 2020. For those who enroll in 2020 and thereafter, states would receive the same match for the able-bodied as it does for any other Medicaid recipient.
Democrats might want to reconsider whether voting for the AHCA might be a wiser political move than trying to pretend that ObamaCare is worth saving when it is crumbling before our eyes.