Day 47: House Republicans Propose Wealth Care Reform

Who wins? (Hint: the rich.) Who loses? (Hint: the poor.)

Yesterday, after years of promises of a plan, members of the Republican House released a draft of the “replace” bill of “repeal and replace Obamacare.”

Paul Ryan asked everyone to #ReadTheBill.

We did.

It can best be described as the anti-Robin Hood bill. It attempts to rob needed health care funds from the poor to reimburse the rich. It isn’t health care reform, it’s wealth care reform.

First, Republicans replaced the mandate to maintain health insurance with a huge penalty if insurance lapses.

People who let their insurance coverage lapse, however, would face a significant penalty. Insurers could increase their premiums by 30 percent, and in that sense, Republicans would replace a penalty for not having insurance with a new penalty for allowing insurance to lapse.

The obvious problem with this is that disincentivizes people to get insurance. Let’s say someone loses their insurance for any reason. To get re-insured, if more than 63 days have elapsed, they are rewarded with a 30 percent increase in yearly premiums. Many people are likely to forego insurance entirely at that point.

The Affordable Care Act mandate required individuals to get on insurance initially or pay a penalty. The ACA incentivized people to get covered: get insured or pay a penalty. The House bill is the total opposite: get insured and pay a penalty.

While the proposed bill has some good in it — it carries over portions of the ACA such as no lifetime limits on benefit payouts, young people can remain on their parents’ health plans until they’re 26, and people can’t be turned down for pre-existing conditions (though depending on the bill’s affordability, this may not last forever, either) — it is overwhelmingly harsh on the poor.

The bill substantially reduces government subsidies to help low-income people pay deductibles, as well as out-of-pocket costs associated with their insurance plans purchased from marketplaces established under the ACA. This could cause large-scale fluctuation in prices in insurance markets.

Ultimately, the bill is disguised as providing health care, but is really a tax break for the top 1% by taking an entitlement from the poor.

The bill also doesn’t align with Donald Trump’s promise that everyone will have insurance (though on Twitter he referred to the bill as “wonderful.”)

Bottom line: who actually benefits from this bill and who doesn’t?

Planned Parenthood — which provides vital health services to many women around the country (and of which receives zero federal money to fund abortions) — gets gutted in a bill designed to help people get healthier.

Medicaid — a program on which 70 million low income Americans rely — is going to be systematically gutted over the next decade. Seventy million people will have less or no viable means to pay for health care.

It’s really this simple, as Senator Chris Murphy (D-CT) noted: people will die as a result of this bill.

Insurance companies get paid, the rich get more tax breaks and the indigent suffer. This isn’t a shock. People like Paul Ryan (R-WI), whose donors for years have overwhelmingly come from the insurance industry and Wall Street, have been put in power to increase the bottom line for the rich.

If there’s a silver lining it’s that Republicans will have a tough hill to climb to get this version of a bill passed, as the New York Times noted, either because some Republican Senators are worried about Medicaid cuts or because some don’t want any version of “Obamacare Lite” passing:

On Monday, four Republican senators — Rob Portman of Ohio, Shelley Moore Capito of West Virginia, Cory Gardner of Colorado and Lisa Murkowski of Alaska — signed a letter saying a House draft that they had reviewed did not adequately protect people in states like theirs that have expanded Medicaid under the Affordable Care Act.

Three conservative Republicans in the Senate — Mike Lee of Utah, Rand Paul of Kentucky and Ted Cruz of Texas — had already expressed reservations about the House’s approach.

This is the conundrum for Republicans in Congress: Obamacare is quietly quite popular in many of their states. Stripping an entitlement like a band-aid won’t go unnoticed.

Other Republicans, often in states whose governors have turned down federal funds designed to help subsidize insurance costs, are in states where their constituents hate Obamacare and want to see it gone at all costs. They generally want to see the bill slashes of even more entitlements.

This bill, like most “repeal and replace” bills, is an attempt to try and appease both types of Republicans. Instead, it has placated neither. It will be nearly impossible to make both sides happy when one side demands the Medicaid provisions remain and the other demands the Medicaid provisions be eliminated.

Meanwhile, don’t expect a single Democrat in either the House or Senate to support this version of a bill.

The wealth/health care reform fight is officially on.

47 days in, 1415 to go

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