Who Loses the Most Under the New Republican Health Care Bill
Majority Leader Mitch McConnell released a draft version of the Senate GOP plan to repeal and replace the Affordable Care Act Thursday morning. Or, more accurately, he released it to the public and his fellow lawmakers – some health care industry lobbyists got a sneak preview the day before. Prior to the big reveal, not even all of the 13 Republican men who were in the working group meant to draft the bill were allowed to see it, according to one of them, Sen. Mike Lee.
“I haven’t seen the bill,” Lee said in a Facebook video on Tuesday. “And it has become increasingly apparent in the last few days that even though we thought we were going to be in charge of writing a bill within this working group, it’s not being written by us. It’s apparently being written by a small handful of staffers for members of the Republican leadership in the Senate.”
There are some key differences between this new Senate version of Trumpcare and the bill that passed the House last month: Gone are the waivers that would allow states to opt out of covering individuals with pre-existing conditions, for example. But much of the bill would end up hurting the same groups disproportionately burdened by the House plan. Here’s who stands to lose the most.
People with pre-existing conditions
Republicans have been quick to emphasize that, unlike the House bill, the Senate version preserves Obamacare’s protections for individuals with pre-existing conditions. It’s a misleading claim, though: The Senate bill still allows states to apply for waivers so they don’t have to cover the essential health benefits they were forced to cover under the Affordable Care Act – which, in practice, makes it possible for insurance companies to refuse to cover some treatments for individuals with certain health histories. The outcome is exactly the same.
Senate Republicans’ bill would offer Americans less money to help pay for worse health care plans. The bill drastically alters the structure under which the subsidies poor people used to pay for health insurance are determined. As Vox’s Ezra Klein explains, under Obamacare’s “benchmark” or average plan, insurers had to cover at least 70 percent of health care costs. Under the Republicans’ benchmark, insurers would be responsible for only 58 percent – that’s 2 percent less than the ACA’s barest-bones plan. The Senate plan also “increases the percentage of your income you can pay for a benchmark plan before it’s deemed unaffordable and additional subsidies kick in.”
That’s not all. The new bill phases out the extremely popular expansion of Medicaid that Obamacare initiated and, even more insidiously, as Democratic Sen. Dianne Feinstein pointed out on Twitter, “It ends Medicaid as we’ve known it since 1965.” The plan also imposes caps on Medicare spending, something the program has never had. A spending limit would mean less money to cover the needs of enrollees, two-thirds of whom are poorer, younger families with children.
Right now, Medicaid provides insurance for some 4.6 million low-income seniors, but that number is expected to increase as Baby Boomers age. The bill’s proposed caps on Medicaid spending include annual increases pegged to inflation, and those increases don’t account for the increase of older enrollees or the fact that those enrollees will come with much higher health care costs, as AARP recently pointed out. Under the House bill, insurance subsidies were pegged to age – an ill-conceived proposition that would have increased premiums the most for the oldest, poorest Americans. Under the Senate bill, subsidies are pegged to income, age and location, which means that older Americans will still see dramatic increases in their premiums.
Not only does the new Senate bill end federal funding for Planned Parenthood, an organization that provides everything from mammograms and cervical cancer screenings to STI testing and contraceptives to 2.4 million women and men every year – it also adds pregnant women to the list of individuals who are ineligible for Medicaid. The impact of this change can’t be overstated. According to the nonpartisan Kaiser Family Foundation, more than half of all births in 24 states are financed by Medicaid.
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With all of those people losing, you may be wondering: Who, exactly, “wins” under the new bill?
Easy: health insurance companies and the rich. The new bill eliminates taxes created under the ACA that helped pay for the subsidies for poorer American. Specifically, the Republican bill would repeal the 3.8 percent tax on investment income and the 0.9 percent tax on annual income for households making over $250,000. For the ultra-wealthy – that 0.1 percent of the population netting more than $3.7 million a year – that amounts to an average tax cut of $165,000, according to the nonpartisan Tax Policy Center. The bill also ends taxes imposed on tanning salons and pharmaceutical companies, and repeals an existing rule banning health insurance companies from deducting more than $500,000 in CEO pay.
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