Opinion

The new TrumpCare is even worse than the old one

So long to maternity care and coverage for pre-existing conditions!

Like some zombie out to devour Americans' health care, TrumpCare is back from the dead.

Sources tell CNN that House Republicans have a new version of their bill to repeal and replace ObamaCare. The negotiations are mostly occurring between two tribes: the hard-right Freedom Caucus, represented by Rep. Mark Meadows (R-N.C.), and the more moderate 50-person Tuesday Group, represented by Rep. Tom MacArthur (R-N.J.). The Trump administration hopes this updated version can pass the House and move on to the Senate.

The original TrumpCare was such a mess, in terms of both policy and politics, that the Republicans ditched it before they even had a vote on the House floor. So you'd think there'd be nowhere to go but up.

Unfortunately, the new TrumpCare is even worse than the old one.

First off, here's what hasn't changed: As far as I can tell, the new proposal would still massively cut Medicaid. It would also offer the same inadequate subsidies — which were much lower than ObamaCare's already-underpowered subsidies — to help customers on the insurance exchanges afford their premiums.

The new twist is that states can opt out of two key ObamaCare regulations: The essential health benefits, and the law against charging people different premiums based on pre-existing conditions.

The essential health benefits (EHBs) are a package of 10 needs — like maternity care, prescription drugs, substance abuse disorders, etc. — that all insurance plans are required to cover. To justify abandoning the EHBs, states would simply have to demonstrate to the federal government that doing so would raise the number of insured people in their state, make premiums cheaper, or somehow "advance" the "public interest."

The EHBs have long been the target of right-wing ire. Why should men have to pay for maternity care, when they will never need it by definition? What this complaint misses is that no one pays insurers for the care they use. They pay insurers for the care everyone in the insurer's customer pool uses. Those are the costs that in turn drive the premiums that insurers charge. It is inherent to the nature of insurance.

So yes, ditching the EHBs could make premiums cheaper — but at the cost of leaving some Americans out in the cold and unable to get coverage for services they need.

The problem with the pre-existing conditions provision is basically the same.

The reason insures don't like to cover people with pre-existing conditions is they're expensive. Covering them raises costs, which raises premiums, which can drive away other customers. Before ObamaCare, the insurers dealt with this problem by often just refusing to offer coverage to sick Americans. The Democrats' health reform put a stop to that practice.

But even then, insurers could still charge sky-high premiums to people with pre-existing conditions. Either the customer pays, and the insurer makes up the cost, or the customer doesn't pay and doesn't get the coverage, and the insurer just avoids the costs entirely. Either way, the insurer can avoid raising premiums on healthy customers to cover the costs of sick customers.

ObamaCare put a stop to that, too. It set limits on how much insurers could differentiate between customers on price. So insurers have to cover everyone, and they have to raise everyone's premiums to pay the additional care costs for people with pre-existing conditions. That's where ObamaCare's subsidies came in. They were meant to make sure everyone in the system could afford their premiums. (Though, as I mentioned, the subsidies aren't generous enough.)

But the new TrumpCare would allow states to opt out of that second regulation: the one preventing insurers from charging wildly different premiums. It comes with a catch, though. States that opt out would have to join "high-risk pools" — systems for subsidizing sick customers, so they can afford the much higher premiums they'd be charged.

So instead of raising everyone's premiums a bit, and then subsidizing everyone a bit, states that went this route would raise sick people's premiums a ton, and then subsidize them a ton. That's the theory, anyway.

In practice, the scheme still falls afoul of conservatives' hatred for redistribution. The spending in the high-risk pools must be paid for somehow, after all. The switch from ObamaCare to TrumpCare 2.0 wouldn't change the need for redistribution — it would just change the route the money takes to get from point A to point B.

History shows how conservative get around this problem: High-risk pools have never been adequately funded when they've been tried at the state level. It's unclear how much money TrumpCare 2.0 would provide — it has previously ranged from $15 billion over 8 years all the way up to $100 billion over 10 years. Unfortunately, to actually save Americans with pre-existing conditions from crushingly high premiums, the high-risk pools would need $250 billion to $500 billion over 10 years.

You can see where this is going. Under the new TrumpCare, Medicare would get cut, as would the subsidies for premiums. On top of that, lots of Americans would have a tougher time getting coverage for basic care they need. And insurance costs in Republican-controlled states would shoot up for people with pre-existing conditions.

To get a sense of what a disaster that could be, consider that about 130 million Americans have some form of pre-existing condition — or about 300,000 per congressional district.

Perhaps the one thing that can be said in the new TrumpCare's favor is that it's more honest. It's the redistribution of ObamaCare — making fortunate people pay to help unfortunate ones — that's always galled Republicans. The essential health benefits and the rule against high premiums for sick people all flow from the basic moral belief that, when it comes to health care at least, Americans are in this together.

That's the belief Zombie TrumpCare has risen from the grave to tear down and devour.

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