Part II: The Senate’s “Better Care”

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Mitch McConnell and the Senate Republicans introduced their revised Better Care Reconciliation Act (BCRA) yesterday. As of this morning, both Sen. Susan Collins and Rand Paul have opposed a motion to proceed on bringing the bill up for consideration to vote. This leaves the Affordable Care Act (ACA) repeal-and-replace in uncertainty, as 3 “No” votes would be enough to doom any chances of passing the Senate. Experts have said that they don’t expect the changes in this bill to alter the CBO’s previous estimate that 22 million could lose their health insurance coverage if passed. This may not matter, as Republicans have made it evident that they could try to push for a vote before the CBO concludes its analysis of the new bill.

Here are the main revisions from the previous bill, with some perspective from Vox:

Cuts to Medicaid remain unchanged, as does the shrinking of Medicaid expansion that more than 30 states have accepted and new patients have found satisfying. Both Republican opposition and citizen outcry thus far have been focused at these severe cuts to Medicaid, which covers half of the births in this country and 1 in 5 Americans, including 2 in 5 children and 2 in 3 nursing home residents. Shrinking the ACA’s program to expand Medicaid is also significant. The CBO has concluded in a separate analysis that these proposed cuts would shut off additional states from accepting Medicaid expansion, and would force some states that have accepted it to drop out, resulting in millions losing coverage.

Denying coverage based on pre-existing conditions has returned to Republican’s healthcare legislation. However, it has become more complicated (likely on purpose), so we’ll spend a little more time discussing it.

You may remember that the first rendition of BCRA left out what the House bill (AHCA) included concerning pre-existing conditions. But Sen. Ted Cruz has offered a new amendment included in the revised BCRA that returns a backdoor option for denying those with chronic health problems. As long as health insurers offer a comprehensive plan – that is, one with essential benefits that the ACA requires to be provided – they can also offer skimpier, deregulated plans. These deregulated plans give more control to insurers in raising costs so high that individuals with pre-existing conditions cannot afford to pay them. Thus, those with chronic health problems will be forced to buy the more expensive and comprehensive plans.

This has several avenues of predictable outcomes that all lead to an unstable marketplace. Ultimately two types of coverage will form: (1) cheap, barebones coverage for rich, healthy individuals, and (2) expensive (or unaffordable), comprehensive coverage for poor, sick individuals. This is explained by Vox author, Sarah Kliff:

Health policy experts know exactly how this would play out: Healthy people would pick the skimpier plan, while the comprehensive plan would essentially become a high-risk pool for sicker Americans.

Individual market enrollees would likely game the system too. A couple expecting a baby, for example, would be expected to upgrade to the [comprehensive] plan that covers maternity care for one year before returning to the cheaper plan they had before.

This tipping of the scales alone could be enough to make comprehensive plans too unaffordable for most individuals, forcing them out of coverage. Those looking to join a comprehensive plan will still be eligible to receive a tax credit in BCRA. However, out-of-pocket costs for deductibles and premiums would remain unbelievably unaffordable. For example, the CBO estimates that a 64-year old earning $11,500 would still need to pay $4,800 for a comprehensive health insurance plan.

Pre-tax money could be used to pay for premiums. Americans enrolled in health savings accounts (HSA), nearly 29% of workers, could now use this money to pay for premiums in addition to their co-pays and co-insurances. This is a great added benefit to those with HSAs, but falls short as a stand-alone option for those who struggle to afford health insurance premiums in the first place. And, as you may know if you have an HSA, this often doesn’t cover the entire cost of a premium.

Wealthy Americans would get less of a tax cut in the revised BCRA. The previous bill included more than $500 billion in tax cuts for high-income individuals and manufacturers. Republican writers decided to extend both a 0.9% investment tax and 3.8% Medicare payroll surtax from ACA that target wealthier individuals.

Keeping these two taxes in place would net the government an estimated $231 billion in revenue over the next decade, and eliminate some of the benefits high-income Americans would have received under the first draft.

Finally, the revised bill provides $45 billion to combat opioid abuse. But as Joshua Sharfstein, professor at the Johns Hopkins Bloomberg School of Public Health, says

The $45 billion they’ve added is a drop in the bucket compared to the amount of money that would be lost in the Medicaid cuts ($800 billion). It’s a tiny fraction of what Medicaid is already providing millions of people.

Think about it. Those addicted to and abusing pain-killing drugs need actual care through sustained coverage – which Medicaid provides – rather than an indiscriminate number of dollars. When you consider that funding for this opioid abuse program constitutes less than 6% of the total cuts imposed to Medicaid, it is sadly apparent that this is included mostly as political leverage. That is, ammunition for BCRA’s supporters to attack those who oppose the bill as a whole for any other legitimate reason.

Despite these poorly addressed flaws, a vote could happen this week. The voice of the people has made a difference at each step of the healthcare reform process. With just 12% approval and millions of lives at stake, BCRA will require sustained pressure on our elected officials. You can use the Trumpcare Toolkit to reach make your voice heard, and if you’re a member of the medical community searching for the right words, here is a great perspective to get you started.

Image: Digg

H.R. 1628, Better Care Reconciliation Act

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The Congressional Budget Office (CBO) and Joint Committee on Taxation (JCT) released their completed report on the Senate’s highly anticipated “Better Care Reconciliation Act” (BCRA) earlier today. In general, the major provisions of this bill are:

  • Elimination of the individual and employer mandates
  • 3-year phasing out of Medicaid expansion in 2021 and a general cut to Medicaid (which covers 1 in 5 Americans and probably a lot more than you think)
  • Basing premium taxes on age, income, and geography (like Obamacare and unlike the AHCA’s age-based income tax)
  • Tax cuts for the wealthy by repealing Obamacare tax increases
  • Allowing states to apply for a waiver that permits insurance companies to deny their enrollees essential benefits, some of the most fundamental services to healthcare
  • Ending cost sharing subsidies to low- and middle-income individuals in 2020 (though Trump may end these earlier)
  • Defunding of Planned Parenthood for 1 year

The CBO concluded that 15 million individuals would lose their health insurance next year under BCRA, and ultimately 22 million would be forced out of coverage by 2026. This is similar to the respective 14 million and 23 million figures from the CBO report on the House’s version, AHCA.

Though the report estimates that premiums would increase by up to 20 percent (relative to Obamacare) in the first couple of years, they would eventually become cheaper in 2020. However, this would largely be a result of a decrease in services covered by health insurance companies under BCRA.

Bluntly, yet still shocking, the CBO states that this bill would save costs by shunning both elderly and low-income individuals from even purchasing a coverage plan “despite being eligible for premium tax credits.” Overall, the cuts in BCRA could result in a death spiral of drastically increased premiums as younger, healthier individuals drop from a pool composed greatly of older, sicker individuals that require more health services.

Finally, the money breaks down as such:

  • $772 billion cut to Medicaid
  • $408 billion reduction in subsidies for nongroup health insurance
  • $107 billion to states and insurers for various purposes
  • $210 billion to reduce collections of penalty payments from employers and uninsured
  • $541 billion tax cut for high-income individuals, manufacturers, and excise taxes
  • Overall, a net reduction of $321 billion

Image: PBS

Jimmy Kimmel’s Reminder That Health Care Should Save Lives

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No parent should ever have to decide if they can afford to save their child’s life. It just shouldn’t happen. Not here.

Nearly 10 million people have heard this emotional plea from the tearful monologue on Monday night’s “Jimmy Kimmel Live.” Kimmel opened the show with an emotional retelling of the birth of his son, Billy, on April 21. After a nurse noticed that the newborn was turning purple, doctors detected a heart murmur and tests revealed that oxygen was insufficiently reaching the rest of his body. Kimmel described the chaotic and terrifying scene that followed as doctors and nurses filled in, surrounding Billy with a sort of frenzied focus. Eventually, Kimmel learned that his son was born with a heart disease and would require immediate surgery.

Billy was diagnosed with Tetralogy of Fallot, a four-part heart defect that includes a ventricular septal defect, or a hole between the ventricles that allows mixing of oxygenated and deoxygenated blood to be pumped throughout the body. After sharing that the emergency, three-hour surgery was a success, Kimmel taught us why we cannot look away from the health care battle. This story provides context to American’s fraught response to the Republican’s debate over scaling back Obamacare’s preexisting conditions clause. This clause requires insurers to offer coverage to everyone who can pay for it and protects sicker individuals from being subjected to astronomically high premiums, as Kimmel explains:

Before 2014, if you were born with congenital heart disease like my son was, there was a good chance you would never be able to get health insurance because you had a preexisting condition…you might not even live long enough to get denied because of a preexisting condition.

The most recent changes to President Trump’s health care bill include an amendment by Rep. Tom MacArthur that would allow states to get waivers that allow insurers to set prices based on how healthy a person is. That is, coverage for those with preexisting conditions would become largely unaffordable and force those individuals to seek new coverage in high-risk pools. The bill would set aside money to subsidize these pools, but experts agree that the subsidies aren’t nearly enough to cover those new costs.

What is the potential impact of this change? Nearly 52 million people, or one quarter of adults under the age of 65, have preexisting conditions whose coverage would be in jeopardy if their state was granted this waiver. Not to mention that radically interfering with balance in the marketplace would lead to expensive and less effective delivery of care. (For a simple, cartoon explanation of this phenomenon, refer to this Vox article.)

This is an important distinction to make from Trump’s recent (false) claims that adequate and fair coverage of preexisting conditions “has to be” and is indeed in the new health care bill. Though a tough sell would await the bill in the Senate, it appears as though the new bill will go for a vote in the House later today.

Here is what else the proposed health care bill would change. It would:

  • repeal the individual and employer mandate
  • remove subsidies for out-of-pocket expenses that are used to pay deductibles and make co-pays in 2020
  • roll back tax increases on high incomes, prescription drugs, medical devices and tanning salons
  • cut federal funding for Medicaid expansion in 2020
  • allow states to waive essential benefit rules that include maternity care, emergency visits and preventative services
  • allow insurers to charge older customers five times as much as younger ones
  • change premium subsidies from income- and location-based to a rudimentary age-based subsidy

As we mentioned in our podcast, advocacy’s willpower at town halls and in the inboxes of elected officials forced responsible action on the American Health Care Act. Moreover, it reminded Washington that its constituents realize what they stand to lose with irresponsible health policy. As the vote nears, Kimmel reminds us that we can all agree on one thing:

If your baby is going to die, it shouldn’t matter how much money you make. Whatever your party, whatever you believe, whoever you support, we need to make sure that the people who are supposed to represent us, the people who are meeting about this right now in Washington, understand that very clearly. Let’s stop with the nonsense. This isn’t football. There are no teams. We are the team. It’s the United States. Don’t let their partisan squabbles divide us on something every decent person wants. We need to take care of each other.

 

Image: Jimmy Kimmel