Paul Ryan Doesn’t Give A Shit About Your Health
“We feel like we’re on track, and we’re right where we want to be,” said Speaker of the House Paul Ryan on Fox News Sunday regarding the developments surrounding his party’s proposed healthcare bill, adding: “We are not actually doing this behind the scenes and just bringing some bill to the floor and making people vote for it…We’re listening to people.”
Both sides of the aisle may be forgiven for thinking Speaker Ryan’s comments were some sort of bad joke. Since they rolled out the American Healthcare Act (AHCA) two weeks ago, the GOP’s proposal has looked anything but “on track.” It has not only received criticism from Democrats, but also from congressmen on differing factions of the Republican Party. Moderate conservatives think the bill does not do enough to protect their constituents, while members of the party’s Libertarian Freedom Caucus treat the AHCA as “Obamacare lite,” an entitlement scheme that is still too generous. The public outcry has been even more fierce, particularly after the Congressional Budget Office’s report that 24 million people will lose their health insurance. The AARP, American Medical Association, and American Hospital Association have all joined in the protests against the AHCA.
The GOP has spent the better part of seven years opposing President Obama’s Affordable Care Act (ACA). From the endless lawsuits, rumors of “death panels,” government shutdowns, and repeated efforts at repeal, opposition to the ACA has been the defining hallmark of the GOP throughout the Obama years. One would think Republicans would have had an alternate plan at the ready as soon as they got into power. Instead, they have approached healthcare reform with a disorganized ineptitude that surprised even their opponents. How can a party with so much to say about the supposed failures of the ACA fail so miserably at providing their own alternative?
The reason is quite simple: Republicans have never cared about providing Americans with proper healthcare. The most altruistic opinion of the GOP’s actions argues that they treat healthcare as any other industry; that is, something to be minimally regulated, left to the whims of the free market for consumers to buy as they see fit. The opposition the party presented against the ACA, and its individual mandate in particular, was grounded in what they saw as blatant government overreach and a violation of individual freedoms, contrary to the up-by-your-bootstraps exceptionalism conservatives champion as the American dream.
The GOP’s fight against the ACA is also led by politicians who not only reject the notion that the government should help to provide Americans with proper access to healthcare, but have had a longstanding personal interest in preventing Americans from doing so. Speaker Ryan once boasted about how he had dreamed of cutting Medicaid, the health insurance program providing access to the poor, since his days sipping beer at keggers with fellow conservatives. Tom Price, Trump’s Health and Human Services secretary and a vocal ACA detractor, would seem to profit handsomely from the ACA’s repeal- given that he has been under investigation over stock trades of healthcare companies that he has made as a congressman. Vice President Mike Pence once compared the Supreme Court’s decision to uphold the ACA to the terrorist attacks on 9/11. Ryan, Price, and company never intended to provide a just and reasonable healthcare bill, and indeed they didn’t.
Broadly, the AHCA’s main goal is to repeal the most hated of the ACA’s component’s and eliminate taxes for the wealthy and healthcare providers. Most other facets of the AHCA are watered down versions of their ACA counterparts dressed up in the conservative mantras of lower government spending, deregulation, and increased market competition leading to better consumer choice (see table). The GOP’s faulty thinking and a policy analysis capacity the economist Paul Krugman deemed “downgraded to the point of worthlessness,” results in a bill that will be disastrous for millions of Americans.
Take the AHCA’s tax subsidies; whereas the ACA pegged its subsidies to income and the price of insurance in an individual’s locality, the AHCA replaces this with a flat-rate tax credit based on age (phased out after an income level of $75,000) and combines it with a loosening of the maximum premiums that can be charged to older enrollees (from 3 times the amount charged to younger enrollees to five times). In place of the penalties of the ACA’s individual mandate that the GOP saw as so damning, they instead propose that insurance companies charge a 30 percent surcharge on individuals who let their insurance lapse more than two months. The conservative’s logic here is that people who use more healthcare ought to pay a larger share, and lowering tax subsidies and regulations will incentivize insurance companies to charge premiums that will be more affordable to their consumers. They claim that the continuous coverage penalty would fix the issue of younger, healthier people opting out of coverage. In so doing, AHCA proponents argue that such policies will create a more competitive and sustainable marketplace that will lower costs and increase options for both insurers and consumers alike.
This is, at best, highly wishful thinking. The AHCA may lower premiums for younger people or individuals in states with already low premiums in the short run, but any claims that it lowers overall premiums are misleading. In instituting a flat tax credit, the AHCA imposes huge burdens on those who are sicker, older, and/or poorer, as well as those living in many rural (mostly Republican) states. The costs vary widely from state to state, but according to the Kaiser Family Foundation, a 60 year old earning $30,000 can be left paying anywhere from 7% of their income in premiums in upstate New York to 88% in Yuma, Arizona; in Denali, Alaska that number rises to an unfathomable 114% of income. Under the ACA, the cost of premiums for such an individual is capped at 8% of income, nationwide.
The GOP bill will also do little to help bring the promised increased competition to the healthcare marketplace. Should the ACA be repealed, providers will face potential technological and administrative costs in transitioning to a new regulatory framework. The bill’s tax breaks and the continuous coverage penalty also do not offset the potential losses insurers will see in their new applicant pools. The repeal of the individual insurance enforcement mechanism (the penalty for not enrolling), combined with cuts to cost-sharing and other subsidies, leaves insurers with no guarantee that younger, healthier people will enroll as well as a larger pool of potential enrollees unable to pay. This will certainly cause insurers to raise premiums; according to one insurance CEO individual-plan premiums can rise by 30% at least. This will further dissuade the young and healthy from opting in, thereby exacerbating the “death spiral” many on the right have professed to want to fix.
The Republican plan gets no better when considering its impacts on Medicaid. The removal of expansion funds is obviously problematic, starving Medicaid rolls in any state that opted for expansion. But the AHCA’s block grants may be even more detrimental. In moving to a fixed amount per Medicaid recipient, Republicans are hoping that states will experiment with different innovations to bring costs down and ensure coverage for all.
Fat chance. One look at the current state of Medicaid eligibility in (mostly Republican-led) states that did not expand coverage under the ACA gives a glimpse of what Medicaid will look like in red states under the AHCA. According to the Kaiser Family Foundation, no states that opted against expansion make Medicaid eligible for families with an income up to 138% of the federal poverty line, as the ACA does. Only three states – Tennessee, Wisconsin, and Maine- ensure eligibility for a family income of at least 100% of FPL. In Texas and Alabama, a family of three do not qualify for Medicaid if their joint income runs to just 18% of FPL, or $3,600. Only one state, Wisconsin, makes adults without children eligible for the program.
This week, Mr. Ryan attempted to address the criticism of the AHCA with a last minute manager’s amendment. True to form, he opted to assuage the concerns of his fellow party members instead of heeding the criticisms from voters and the healthcare industry. In deference to the thirty members of the House’s Freedom Caucus, proposed changes include cutting Medicaid eligibility even further by instituting work requirements and eliminating the per capita provision of the block grants, while speeding up the repeal of ACA’s taxes. To placate moderate conservatives, Ryan added extra subsidies for older enrollees. These tweaks have predictably backfired, as the concessions given to one side have worked to anger the other, and vice versa. Opposition to the AHCA has only grown, with as many as 28 Republicans set to vote against it.
The failure of Paul Ryan and Republicans to get healthcare right stems from their indifference to people’s health outcomes. This is most clear when one considers their perception of individual freedoms in the context of healthcare. The GOP loathed the individual mandate for what they saw as an inhibition of an individual’s right to choose whether to have healthcare or not. To label this a “choice,” however, is asinine. It is true that most reasonable people do indeed seek to minimize their costs of healthcare. They also seek to maximize the benefits they get and look to reduce their risk of paying huge amounts of money, should an emergency arise. While this principle also applies in most insurance markets, to treat healthcare in the same way is to misunderstand humans entirely. People do not take risks when it comes to their health, or the health of their children. Moreover, proper health insurance not only covers risk, but consumption as well: check-ups, regular screenings, medications etc. Individuals who opt out of coverage are not doing so because they do not care about the risk to their health, they do so because they are unable to pay.
To label such a circumstance as a choice is perverse. In penalizing the most vulnerable through cuts to Medicaid, repeals of subsidies for the poor, and higher costs for the old, Republican lawmakers show who they truly care about: their wealthy donors, and no one else. No matter the outcome of the vote in Congress Thursday, their constituents should bear this in mind in deciding their own future votes ahead.