House Republicans and President Donald Trump took a victory lap after passing the American Healthcare Act earlier this month despite the fact that the Congressional Budget Office (CBO) had no opportunity to estimate the bill’s impact before it was voted on and passed. The CBO released its score on the bill May 24 and there appears to be good reason why the Republicans acted to approve the bill before anyone could estimate the impact.
To be fair, we will try to examine the positives and negatives in the bill according to the CBO, but be aware there appears to be many more negative aspects to this bill than positive ones.
The Positives
- The new healthcare bill will lower premiums: The bill does this by allowing states to opt-out of requirements of the Affordable Care Act (Obamacare) that insurers must ignore health status of individuals when pricing premiums. This easing of insurance mandates would reduce premiums about 4 percent by 2026 for people who purchase plans on their own and by 20 percent in states that opt-out of the Affordable Care requirements. According to the CBO, many states would not opt-out of the requirements and those that do might offer less expensive premiums, but fewer services would be available.
- No requirements to purchase health care: Under Obamacare people who choose not to purchase healthcare plans are taxed for their failure to do so. The idea behind this penalty is that the more people who participate in purchasing health plans would equate to lower premium costs for all.
The Negatives
- Less people covered: One of the main goals of Obamacare was to increase the number of people who had health insurance and that goal was met. Well more than 10 million people were able to access health insurance since the passage of Obamacare. The CBO estimates that the Republican plan would cause 23 million Americans to lose health insurance within the next 10 years. This would save an estimated $119 billion, which doesn’t seem like a good trade-off.
- Americans may pay more and have less coverage: This contradicts one of the positive aspects of the bill mentioned previously. The reason costs may increase despite premium decreases is there will be less government subsidies, especially for older Americans. The CBO estimated that a 64-year-old earning $26,500 a year, who is not yet eligible for Medicare yet, would pay a whopping 850 percent more for a healthcare plan. Obviously someone in this situation could not afford coverage.
- Medicaid cuts: There are massive Medicaid cuts in the new plan for poor people who rely on the program for healthcare coverage. If the passage of the new healthcare law was enacted and Trump’s budget proposals also approved it would equal $800 billion worth of cuts to Medicaid. Considering the new healthcare bill would save an estimated $119 billion, this could be money that could be used to help insure some people who would lose Medicaid coverage, but also not come close to the funding needed to cover how many people now have coverage.
Obviously the Senate has not acted upon the AHA and there was little enthusiasm in the upper chamber of Congress for the bill, so whatever health care bill is passed, if any, and signed by Trump could look much different. Moderate Republicans are sure to try and ease the amount of cuts to Medicaid in an effort to get more people covered and to have less people actually lose insurance.
