The Senate GOP hid the meanest things very deeply in its Obamacare repeal bill. We found them.
Protestors gathered in front of the Capitol Wednesday as Senate Republicans prepared to unveil their Obamacare repeal bill. (AFP Getty)
The Affordable Care Act repeal bill unveiled Thursday by Senate Republicans has aptly drawn universal scorn from healthcare experts, hospital and physician groups, and advocates for patients and the needy. That’s because the bill is a poorly-disguised massive tax cut for the wealthy, paid for by cutting Medicaid—which serves the middle class and the poor— to the bone.
Yet some of the measure’s most egregious, harshest provisions are well-disguised. They’re hidden deep in its underbrush or in the maze of legislative verbiage. We’ve ferreted out some of them and present them here in all their malevolent glory. In this effort we’ve built on ace detective work by Adriana McIntyre, Nicholas Bagley of the University of Michigan, David Anderson of Duke University and balloon-juice.com, Andy Slavitt, the former head of Medicare and Medicaid in the Obama administration, and others.
Some of these provisions match those in the House Republicans’ repeal bill passed May 4, and some are even harsher—more “mean,” to use a term President Trump himself applied to the House bill. That bill, according to the Congressional Budget Office, would cost some 23 million Americans their health coverage by 2026. The Senate bill wouldn’t do much better, and might do worse.
–States will have more authority to reimpose lifetime and annual benefit caps and eliminate essential health benefits. This may be the most insidious provision of the repeal bill, and certainly is the most deeply hidden.
It’s buried in changes made to the ACA’s so-called Section 1332 waivers, which are designed to allow states to try innovative approaches to healthcare, especially through their Medicaid programs. Under the ACA, states can only seek waivers under certain conditions. The “innovative” changes can’t lead to fewer people insured, or subject them to higher out-of-pocket expenses.
The Senate bill repeals those limitations—and removes the flexibility of the Secretary of Health and Human Services to approve them. Under the measure, the secretary “must” approve a waiver request as long as it won’t increase the federal deficit. As a result, states would be able to eliminate the essential health benefits that all health plans must provide under the ACA—including hospitalization, prescription coverage, maternity care, substance abuse and mental health treatment. Since only essential health benefits are subject to the ban on lifetime and annual benefit limits, high-cost patients such as cancer victims and sufferers from chronic diseases could permanently lose their benefits early in their treatment.
Would states roll back these protections? By some reckonings, they’d have no choice. The overall impact of the Senate bill would be to shrink the individual health insurance market and leave sicker customers in the insurance pool, says Jeanne Lambrew of the Century Foundation, in part because the measure eliminates the individual mandate that keeps younger and healthier buyers in the market. As a result, she says, insurers will put enormous pressure on state governments to loosen their regulations to lower their risk.
States would also be authorized to waive rules requiring that almost all customers be charged the same premium. That’s an invitation to preferential pricing that would effectively remove protections for people with pre-existing conditions—they could be priced out of the individual market, in a return to the dysfunctional system that denied them insurance in the pre-ACA era.
Under the repeal bill, waivers would be in place at least for eight years, compared to five under the ACA. That means that the rollbacks of consumer protections would be inoculated against repeals by new state or federal administrations.
–Protection for people with pre-existing conditions is destroyed. Senate Republicans claim in their talking points that the measure protects people with pre-existing conditions from being denied coverage or priced out of the market. Don’t believe them. As Gene Sperling, a former economist for the Clinton and Obama administrations, and Michael Shapiro observe, “the Republican plan may not allow insurers to discriminate…through the front door, but they’ve created a backdoor way in.”
The key is that same 1332 waiver provision. If state’s allow insurers to offer plans without those essential health benefits, they’ll offer “skinny” plans that don’t serve the needs of those with serious conditions. Plans that don’t cover cancer drugs or hospitalization, perhaps. Those patients will have no choice but to opt for more comprehensive plans, which will end up with an overabundance of expensive enrollees and therefore much higher premiums.
“The Senate bill will open the door to states forcing people with pre-existing conditions into segregated markets that will lead them to pay far, far higher costs than everyone else,” Sperling and Shapiro say. “This bill will bring the country back to a system in which insurance only works for the healthy, and the sick can’t afford the coverage they need.”
–Older Americans would get socked with much higher premiums and costs. The Senate bill changes the ACA’s premium subsidies in ways that severely hurt older customers. The bill expands the permissible range of premiums for older buyers compared to younger from 3-to-1 in the ACA to 5-to-1. In other words, older buyers could be charged much more. It reduces subsidies for older buyers in other ways. The ACA’s subsidies are based entirely on income, and are provided to households with income up to 400% of the federal poverty line. That ceiling is $48,240 for an individual.