American Health Care Act, a Summary & UPDATE

 

By Wayne Caswell, founding editor

UPDATE 3/24/2017 — Not enough Republicans agreed to pass the American Health Care Act, which would repeal much of Obamacare and kill thousands of Americans by leaving them without health care, so they pulled it.

UPDATE 3/24/2017 — Republicans in the U.S. House of Representatives scheduled a critical vote today but could not secure enough votes within their own party to pass the American Health Care Act. So Speaker Paul Ryan and and President Trump decided to pulled it. The bill to partially repeal Obamacare would partially fulfill a campaign promise and give tax breaks to wealthy benefactors, but it would also steal from the Medicare Trust Fund, gut Medicaid, and result in the deaths of Americans by leaving them without health care. Pulling the bill was a better option than facing angry constituents, 85% of whom were against it.

As a left-leaning consumer advocate focused more on policy than politics, I’m glad; but now Congress must find ways to shore up Obamacare insurance exchanges and work toward more effective health reform. Too many healthy people have stayed out of the private insurance market, choosing instead to pay the tax penalty. That left too many older and sicker people and caused many insurance companies to lose money with the policies they offered. The ACA mandated penalties were apparently not high enough to convince healthy people to sign up, so fixing that should be relatively easy.

It’s my hope, however, that both parties will now reach across the isle in a bipartisan way and do the hard work of making affordable healthcare available to everyone, as the President promised. The Republican rhetoric that Obamacare is collapsing is not accurate or helpful, and I worry that HHS Secretary Tom Price could make things worse with rule changes and then blame Democrats for resulting problems. But that too is not helpful.

I continue to believe we can cut our $3.5+ trillion/year healthcare costs in half, and also improve outcomes, by adopting a single-payer national healthcare system like all other advanced nations have. But that would require standing up to powerful special interests who don’t want to lose revenue and profit. It’s my view that we should migrate off of employer-provided and private health insurance and provide healthcare universally for all citizens as a right. Yes, they would pay higher income taxes but overall healthcare costs would be far lower, especially if we also abandon fee-for-service business models, ban drug companies from advertising to consumers, and focus on wellness, prevention, and more efficient delivery systems through smart uses of technologies like telehealth and medical tourism across state lines. 


American Health Care Act — a Summary

I can’t avoid getting political when it comes to healthcare, and I’ve been critical of both Obamacare and the medical industry, which spends three times as much on lobbying as the military industrial complex.

Obamacare made improvements but is far from perfect, so I’m all for replacing it eventually with a single-payer system that cuts our $3.5+ Trillion/year spending in half to match what other advanced nations pay on a per capita or percent of GDP basis. Unfortunately, the Republicans’ American Health Care Act (AHCA) would just shift the financial burden to the poor, disabled, and elderly while giving a huge tax cut to the wealthy and doing more harm than good.

According to the bipartisan Government Budget Office (GBO), tens of millions of Americans would lose their insurance under the AHCA, because they’d be unable to afford it. As a result, tens of thousands of them would die needlessly.

Understanding the full impact of this Republican healthcare bill is difficult, given the mixed spin from both political parties, and the fact that most articles just describe one aspect of it or another. The purpose of today’s post is to pull it all together and include a summary page that you can print as a reference when discussing the issues with friends.

AHCA is Just Part of a Larger Republican Plan

Republicans have had seven years to “repeal & replace” Obamacare, the Affordable Care Act, and in all that time they’ve been unable to come up with a good replacement. Now that they control the Presidency and Congress, they’re trying to rush through a replacement but still haven’t gained enough support in their own party. They also face still opposition from Democrats, and from Senate rules that require a 60% vote. That means they’ll need some Democrats to help them replace Obamacare unless they enact “the nuclear option” to overcome a filibuster, which would be a risky permanent rules change.

PART 1 – Republicans can make financial changes involving taxes and budget with just a simple majority, so that’s what the AHCA is: the first step. It’s a relatively simple step, except that too many constituents have shown their disagreement and anger and applied pressure, especially on representatives facing reelection challenges in 2018. If the bill survives a House vote, it will find the Senate even more difficult, because Republicans only have a thinner majority there.

PART 2 – Health & Human Services (HHS) Secretary Tom Price can make significant changes on his own with the stroke of a pen and change how healthcare rules are interpreted, applied and administered. That’s scary given his history of using his public office to make investments in the medical industry, and then influencing policy to affect the profitability of companies he invested in. So the question is, will he now function as a physician and “first do no harm,” or will his decisions further enrich himself and his industry partners?

PART 3 – There are many parts of Obamacare that can’t be easily undone without 60% vote, and that needs help from Democrats. These include:

  • Insurance competition across state lines
  • ACA Insurance 80/20 rule requiring 80% of premiums to be applied to medical care
  • Replace preexisting conditions requirement with state administered High-risk Pools
  • Annual & lifetime insurance caps
  • Stay on parents’ plan until age 26
  • ACA promotion of innovative business models such as Accountable Care Organizations, Patient-Centered Medical Homes, EMR Meaningful Use incentives

And you thought the Town Halls were feisty

I met Dr. Michael Burgess, my Congressional Representative who chairs the House Energy and Commerce subcommittee related to health care, and I shared my disappointment with the direction that he and other Republicans are taking health care. I also attended his Town Hall meeting, similar events and protests around Texas, and even did a road trip to Austin with dozens of others to voice our concerns during a Capital Day sponsored by Cover Texas Now. But as feisty as many of those rallies and town halls were, none compared to Elizabeth Warren as she addressed Republicans preparing to vote on the American Health Care Act.

Summary of the American Health Care Act

The summary page I promised is available here in PDF form. It describes the ACT as CRUEL, COSTLY and CORPORATE.

AHCA Summary

Related Articles

Over the last five years, I’ve posted well over 100 consumer articles on healthcare policy. Here are some of my Favorites and most relevant to today’s article:

  1. US Healthcare System has Cancer. Can Trump Fix it?
  2. Escape Fire: The Fight to Rescue America’s Healthcare (documentary film)
  3. Transforming Our Flawed Healthcare System
  4. Influencing Healthcare Policy – Lobbying, Incentives & Insurance
  5. Health Care Reform – Progress and Next Steps (by President Obama)
  6. Let the Health Care Reform Debates Begin, Again
  7. Why Republicans Want to Repeal Obamacare
  8. Healthcare as Public Utility
  9. Universal Healthcare Opposition
  10. Chipping Away at Healthcare Special Interests Yet?
  11. HEALTH or SICK Care?
  12. Disrupting Healthcare with Functional Medicine 2.0
  13. Corporate Behavior and Rising Health Care Costs
  14. Wealth Inequality, Healthcare and the Economy

Hundreds of mainstream press articles covered different aspects of the American Health Care Act, and in many cases I commented. Here are some of the best:

  1. Obamacare: The Republican Waterloo (The Atlantic – exceptionally well-written historical perspective of health reform)
  2. On health reform, Donald Trump followed Republican leaders into a ditch (Vox on how it all happened)
  3. How health care works around the world (CNN, great charts)
  4. Republicans are Losing the Healthcare War to “Win” a Battle (RealClearMarkets)
  5. The GOP’s Obamacare repeal plan is out – and it’s even worse than anyone expected (Chicago Tribune)
  6. Why Even Some Republicans Are Rejecting the Replacement Bill (NY Times)
  7. “It won’t work.” Obamacare’s toughest critics are panning the GOP replacement bill. (Vox)
  8. CBO: Republican bill raises premiums for older, poor Americans by more than 750% (Vox)
  9. White House analysis of Obamacare repeal sees even deeper insurance losses than CBO (Politico: 26M v. 24M)
  10. Who Wins and Who Loses Under Republicans’ Health Care Plan (NY Times, great charts)
  11. What the GOP health plan really means for taxes (Washington Post)
  12. Here’s the secret payoff to health insurance CEOs buried in the GOP Obamacare repeal bill (LA Times)
  13. Why It Matters How We Define ‘Insurance’ (WSJ)
  14. What the Republican Obamacare replacement plan means for the sickest Americans (Vox)
  15. Republicans lied about healthcare for years, and they’re about to get the punishment they deserve (Business Insider)
  16. Why can’t Republicans give straight answers about their health care bill? Because the truth is ugly (Salon)
  17. The real reason Republicans are ramming through a health care bill that no one wants (Quartz)
  18. The new Republican health-care plan is awe-inspiringly awful (Washington Post)
  19. House leadership Obamacare repeal bill is Republican declaration of class warfare (Salon)
  20. Paul Ryan’s Health Care Plan Doesn’t Really Eliminate The Individual Mandate (Huffington Post)
  21. Why the Obamacare repeal bill will have an even tougher time in the Senate (Vox)
  22. Tom Price, Dr. Personal Enrichment (NY Times)
  23. Texas Braces for Medicaid Cuts under GOP Health Plan (NPR)
  24. How Lower Premiums Could Mean Higher Health-Care Costs (Bloomberg)
  25. Obama health law’s “essential benefits” may be in jeopardy (Associated Press)
  26. Abortion rate declines to historic low, with Obamacare a likely contributor (LA Times)
  27. The AHCA’s war on women: There’s nothing “pro-life” about the Republican health care bill (Salon)
  28. Could the [non-group] individual insurance market collapse in some states? (Salon)
  29. U.S. judge finds that Aetna deceived the public about its reasons for quitting Obamacare (LA Times)
  30. Obamacare repeal guts crucial public health funds (Washington Post)
  31. 20% cut to NIH budget would leave Americans more vulnerable to cancer and other diseases, experts warn (LA Times)
  32. The American Health Care Act would lead to more smoking, disease and tobacco industry profits. (Salon)

Related Charts

The fall and projected rise in the uninsured ranks


How deductibles could change under the House GOP plan


How House Republicans' health reform plan might shift average health insurance tax credits, based on income and age, in 2020

8 thoughts on “American Health Care Act, a Summary & UPDATE

  1. *Whatever health care plan is devised and passed into law I think all who agree to pass this into law should be required to use the health care bill they are proposing. if you remember the Obama-care proponents did not want to use Obama-care. They requested to stay with their own health-care plan. I think there might have been something wrong with the Obama-care plan(as history showed) for those who proposed the Obama-care refused to accept that plan for their own.

  2. *Obama-care is a horrific pile of garbage (from any honest political perspective), and while this has a few improvements, it is as well. It does little to free up the market influences that might result in competitive cost reductions and continues to perpetuate exceedingly unwise and very expensive government interventions in the marketplace that can do nothing but destroy a competitive marketplace that could benefit consumers.

    Besides all that, it is Medicare and Medicaid that is most responsible for the high cost of health care here in the U.S. By negotiating rates that are not commensurate with honest pay-rates, and by mandating that its rate is less than the insurance rates, it makes the insurance rates way higher, both to establish a discount for medicare rates, and to cover the part that it being run at a loss to Medicare. The real ones being given the shaft are the cash pay people, that often must pay a rate that is even higher than insurance (they require discounts from the “regular” rate, so the cash becomes that, artificially inflated.)

    Regulations in this area (not all) and the injection of horribly run government health related programs  has destroyed real market competition. and innovation. Medicare in our market makes it all but impossible to establish what market prices should actually be. It also stands in the way of a single payer system being set up in the states (not my thing, but it could be in one or a consortium of states) regardless of whether you are a progressive or a ultra free market conservative, the fact remains, getting the federal government, an entity way more fiscally and morally corrupt than any evil corporation that the left likes to decry, out of the health care arena, and allowing the states to decide what approach to take would yield a far better outcome. But as long as the big gorilla of Medicare is in the room, it is difficult to see how that could be possible.

    1. Thanks, Greg, for your comment. It’s hard not to look at healthcare policy without jumping into the political weeds, and it doesn’t help that our elected officials are so divided, working for special interests who help fund their campaigns and personal wealth, rather than for public interests. America too is bitterly divided, and you may not agree with my analysis, but I hope you’ll be open enough to consider it.

      You may already know that the Patient Protection and Affordable Care Act (Obamacare) was modeled after Mitt Romney’s plan in Massachusetts, which also had an insurance mandate to make sure that insurance pools included healthy people. That concept originated from the Heritage Foundation, a conservative Think Tank. You should also know that Democrats have long wanted Universal Healthcare (single-payer) but had to compromise due to opposition from conservatives and industry lobbyists. The result was that the ACA did not allow Medicare to negotiate drug prices.

      As a technologist, futurist, consumer advocate, and founding editor of Modern Health Talk, I scorn the politics and focus instead on the root causes of our rising healthcare costs, as well as ways to improve care delivery and outcomes at dramatically lower costs. I’m an advocate of Universal Healthcare because I see economic benefits and a moral imperative of viewing healthcare as a right, just like every other advanced nation. Republicans unfortunately see things differently (http://www.mhealthtalk.com/universal-healthcare-opposition/).

      I support free-market capitalism but have seen that it doesn’t work in healthcare when the incentives are misaligned with the objectives of developing a healthy, skilled and productive workforce. Consumers can’t effectively shop for the best value in care when they are unconscious or in severe pain, or when hospitals won’t disclose the total costs of procedures ahead of time, or don’t tell them when a consulting physician is “out of network.” There are many articles published here that support that view, including one promoting the documentary, “Escape Fire: The Fight to Rescue America’s Healthcare.” (http://www.mhealthtalk.com/escape-fire-rescuing-healthcare/)

      I agree with your desire for market competition to encourage capitalists to take risks and drive tech innovation. So, several years ago I proposed the hybrid concept (http://www.mhealthtalk.com/hybrid-model/) with the hope of getting the incentives right (http://www.mhealthtalk.com/get-the-health-incentives-right/). That’s because I can see benefits of both private-sector and public-sector organizations, since they have entirely different objectives and measure success differently, so the trick is to capitalize on the benefits of each.

      I completely disagree with your assessment of Medicare and Medicaid, however, since they’ve been proven to be significantly more efficient than even the most-efficient private health insurance company, Aetna. If I were to place blame, I’d put it instead on our continued reliance on employer-provided and private health insurance that functions as a middle-man and adds costs, and the fee-for-service business models that encourage providers to test more, treat more, and prescribe more. I must also add the TV advertising of prescription drugs. (No other nation allows that.)

      The Escape Fire documentary and other sources on this website emphasize that the U.S. spends twice as much as other advanced nations on healthcare, but we still live sicker and die younger. Why is it that our system has gotten to the point it is today? It’s largely do to the corrupting influence of big money in politics and the fact that the medical industry spends three times as much on lobbying as the military industrial complex to defend its obscene $3.5+ trillion/year profits that depend on illness and injury, meaning there’s more incentive to treat symptoms so patients/customers keep coming back, paying. Steven Brill described that well in his 38-page TIME Magazine special report summarized here: http://www.mhealthtalk.com/why-high-medical-bills-are-killing-us/.

      While as a technologist and futurist, I remain guardedly optimistic; but I’m lead to the conclusion that fixing healthcare is impossible without fixing government. I’m not willing to use that as an excuse to abdicate our healthcare responsibility to individual states. One reason for that is that we are much more mobile today than in decades past. Jobs don’t last as long, so people move often for new employment opportunities. And since travel is so easy, we need ways of getting care when out of state. We also need the efficiencies of telemedicine and medical tourism across state lines, meaning we need more consistency from state to state, not less.

    1. James, I join with the U.K. and the other advanced nations who see healthcare as a right and offer some sort of single-payer system that doesn’t rely on employer-provided or private insurance. While there are some other factors, including our fee-for-service business model incentives, Universal Healthcare has been proven to be more efficient than putting the profitable insurance industry between patients and doctors. It’s why Americans pay twice as much for care but still live sicker and die younger.

  3. Tax Credits vs. Subsidies — Under the ACA, low-income people were able to use monthly subsidies to buy insurance, but under the AHCA they’d have trouble using annual tax credits to do that, because they live paycheck-to-paycheck and can’t wait for their tax return.

    Why can’t we offer the same healthcare for Congress, wealthy elites, the elderly, and the poor? — Rather than using healthcare to divide the classes, adopt Universal Healthcare through a single-payer system like Medicare-for-All or what every other advanced nation offers. (http://www.mhealthtalk.com/universal-healthcare-opposition/)

    Republicans have an ideological aversion to offering healthcare, or any other social program, to anyone who doesn’t work hard enough, doesn’t have enough determination, or is a Loser” and doesn’t deserve it. But Universal Healthcare is a way to deliver on Trump’s promise to make sure everyone gets healthcare that’s better and cheaper than under Obamacare, without abandoning conservative values. It also could eliminate Medicaid, Medicare, CHIP, and other programs that help people with limited means get care. And it would help eliminate our cancerous dependency on insurance. (http://www.mhealthtalk.com/us-healthcare-system-has-cancer/)

    The other nations see healthcare as a basic right of citizenship and being human. And as a result, they’ve been able to pay half as much as we do but with better longevity and outcomes. So yes, Universal Healthcare works, even better than having employer-provided or private insurance between patients and providers.

    Let’s hope Democrats and Republicans exploit this opportunity to use the AHCA-defeat to spark bipartisan reforms that work for everyone and save over $1.5 trillion/year in overall healthcare costs. But doing so will take courage and a willingness to stand up to industry special interests who spend three times as much on lobbying as the military industrial complex. Who will lead that?

  4. OTHER RELATED ARTICLES: Let me know of any that are especially good, and I’ll list them.

    Why Democrats Should Help Trump Fix Obamacare (reasonable suggestions)

    The GOP’s problem on health reform is they’ve spent years hiding their real position (VOX, I commented)

    Republicans in Congress still have time to honor Trump’s campaign promise to replace Obamacare with a healthcare system that covers everyone with much better care at far less cost, but they must swallow their pride, ask different questions, and consider Universal Healthcare (not Universal “access” to health insurance).

    Start with, “What REALLY is behind Republican opposition to universal healthcare?” It sure seems like it’s a fear of helping “LOSERS”. See http://www.mhealthtalk.com/universal-healthcare-opposition/.

    Robert Reich also shared his views about why Republicans want to repeal Obamacare, and I expanded on them in http://www.mhealthtalk.com/why-republicans-want-to-repeal-obamacare/.

    Many other recent articles on Modern Health Talk address the issues of public health policy and health care versus health insurance, so I encourage you to check them out too.

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