Ryancare: Who wins, who loses
Martha Brawley of Monroe, N.C., voted for Donald Trump “in the hope he could make insurance more affordable,” said Abby Goodnough and Reed Abelson in The New York Times. Brawley, 55, is “feeling increasingly nervous” now that the House GOP has unveiled its long-awaited bill to replace Obamacare. The American Health Care Act, crafted by House Speaker Paul Ryan and supported by Trump, would replace Obamacare’s income-based premium subsidies with age-based tax credits of $2,000 to $4,000 per year. Those credits “would not cover nearly as much of the cost of premiums as the current subsidies do”—raising health-care costs for millions of Americans. At the same time, Ryancare would put strict limits on Medicaid spending and kick millions off the program. Brawley herself would receive $5,188 less in tax credits per year under Ryancare, and now fears she’ll become one of the 14 million people the nonpartisan Congressional Budget Office estimates would lose health-care coverage right away. “I’m scared, I’ll tell you that right now, to think about not having insurance at my age,” says Brawley. Perversely enough, said Eric Levitz in NYMag.com, Ryancare most benefits the young and middle-income urban elites who voted for Hillary Clinton. “But it just hammers the older, rural working-class voters who backed Trump.”
Rural counties would be hit “particularly hard,” said Anna Wilde Mathews and Dante Chinni in The Wall Street Journal. Under Obamacare, subsidies were pegged to premium costs in each geographic area—which, in rural regions, tend to be higher because of a lack of competition among insurers. Not so with Ryancare’s tax credits. As a result, “in Nebraska’s Chase County, a 62-year-old currently earning about $18,000 a year could pay nearly $20,000 annually to get health-insurance coverage under the House GOP plan,” consulting firm Oliver Wyman estimates.
Middle-income Americans, however, would get some relief from Ryancare, said Henry Curr in TheEconomist.com. Obamacare focused on helping lower-income people get insurance, and its income limits cost the middle class “dearly.” A family of four earning around $100,000 was forced into the same risk pool as the chronically ill, but earned too much to “get the subsidies that shield those on low incomes from Obamacare’s high premiums.” Under Obamacare, many saw their premiums soar by 300 per-cent or more. Ryancare offers them relief by raising the income ceiling for tax credits to $75,000 for individuals and $150,000 for couples. Truth is, our current health-care system is “very badly broken,” said Chip Roy in NationalReview.com. Ryancare tries to remedy that, but it’s too similar to Obamacare to make a major difference. Only by fully repealing Obamacare can we let free markets, and experimentation in the states, give consumers real cho ice in making health-care decisions, without Washington interference.
Without Obamacare’s interference, said Margot Sanger-Katz in NYTimes.com, millions of older and poorer Americans would have no health care at all. Look at what Ryancare does to people in their 50s and 60s. Under Obamacare’s rules, insurance companies can charge older adults no more than three times more than younger enrollees. But Ryancare increases that ceiling to five times, while also providing smaller tax subsidies and letting insurers raise deductibles—leading to “enormous” out-of-pocket costs. An average 64-year-old earning $26,500 would have to shell out $14,600 under the Republican health-care plan, up from $1,700 under Obamacare—meaning they’d probably have to drop insurance altogether. Ryancare could have literally fatal consequences for another vulnerable group, said German Lopez in Vox.com. Amid the country’s ongoing opioid epidemic, 1.3 million Americans currently receive drug addiction treatment under Medicaid. Ryancare allows states to drop those essential services—leaving millions of addicts “stranded without potentially lifesaving care.”
“Care to guess where the billions of dollars in savings from these cuts would go instead?” said David Leonhardt in The New York Times. To the rich, of course, who would be Ryancare’s biggest winners. Obamacare covered the costs of extending coverage to the poorest and sickest with a series of taxes on couples making more than $250,000. The Republican replacement law scraps those provisions, transferring back more than $600 billion in public health spending to the richest 1 percent of households. Indeed, the richest of the rich—the 0.1 percent of Americans who earn more than $3.75 million annually—would see their taxes fall by an average of $165,090 per year. Ryancare might do a poor job of helping uninsured Americans get health coverage, but as “a tax cut for the wealthy,” it would be a home run.