Over the course of the 2016 election, then candidate Donald Trump promised to repeal the Affordable Care Act (ACA) and replace it with “something terrific” that would “take care of everybody.” However, the American Health Care Act (AHCA) released by House Republicans on Monday night is not something terrific. In comparison to the ACA, the AHCA takes benefits from the poor and gives them to higher earning Americans.
The plan released on March 6 would cut funding to states that cover low-income adults through Medicaid while at the same time repealing subsidies for out-of-pocket expenses. On the other hand, the rich would receive new benefits not available to them under the ACA. Americans with higher incomes would become eligible for subsidies and the taxes on high incomes would be repealed, giving the highest earning Americans a tax break at the cost of the poor and sick. In addition, the plan would allow people to save more money every year in a tax-free health savings account, benefitting people who pay high income tax rates and have extra money to put into these accounts.
The AHCA, also known as “TrumpCare” in Washington, goes even further by including a tax break for insurance companies that pay their CEOs more than $500,000 a year. Not only does the plan cater to people with a high income, it also threatens the health care of over 20 million Americans who gained coverage through the ACA. According to S&P Global Ratings, between 6 and 10 million people would lose health insurance if the Republican bill became law. S&P said that if the AHCA was passed, enrollment in the individual health insurance market would decrease by 2 to 4 million people and there would be an estimated decline of 4 to 6 million people in Medicaid after 2020. In addition to reducing the number of insured Americans, the GOP plan would specifically hurt older Americans who need health insurance.
TrumpCare would allow for insurance companies to charge older customers up to five times what they charge younger customers, an increase from the ACA. The bill also targets women’s health by defunding Planned Parenthood for a year and by making the new tax credits unable to be used for health care that covers abortions. However, the AHCA does keep the more popular aspects of the ACA: Insurers cannot deny coverage based on pre-existing conditions, annual or lifetime caps are banned and dependents can stay on their parents’ insurance plans until they are 26. The Republican plan would also get rid of perhaps the most unpopular mandate from the ACA, meaning that people would not be penalized for not having health care.
While this may seem good for young, healthy Americans who do not want to spend money on insurance, this plan gives people a strong incentive to not buy health care until they are sick which in turn drives up prices for the sick and elderly. Although the proposed plan will raise the cost of insurance for those who benefitted from the ACA, Rep. Jason Chaffetz (R-UT) proposed that people could afford it by simply choosing not to buy iPhones.
The Republican plan in its current form will not fulfill Trump’s campaign promise of extending affordable health care coverage to all Americans, though there is some doubt over whether the GOP will be able to “repeal and replace.”
If the Republicans do repeal the ACA it will most likely have severe political consequences in the upcoming 2018 and 2020 elections. Congressional Republicans have been plagued with constituents at town halls demanding that the ACA not be repealed, especially not without a replacement in place. Though the process is still in the early stages, it seems as if these protests have been working. Sens. Rob Portman (R-OH), Shelley Moore Capito (R-WV), Cory Gardner (R-CO) and Lisa Murkowski (R-AK) released a signed letter stating that they would not support a bill that would reverse the Medicaid expansion in their state. Other Republicans such as Senator Rand Paul (R-KY) rejected the plan for not being conservative enough and even described it as being “Obamacare Lite.”
The bill needs 50 votes to pass in the Senate, meaning that the Republican leadership cannot afford to lose more than 2 senators. Differing views within the Republican Party and public pressure might kill the bill before it reaches the president, saving millions of Americans the health care they so desperately need.
If President Trump does sign the AHCA he will be breaking yet another promise that he made to the American people.