The GOP's Latest Health Care Replacement Bill Is Even More Heartless Than First Thought

Americans getting health care at work can also see benefit cuts.

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As the House begins its series of votes Thursday to repeal Obamacare, it’s clear that members of Congress are still discovering more brazen giveaways to the insurance industry that will negatively affect more American households.

The biggest example, first reported in the Wall Street Journal, was new fine print in the bill that would allow insurers to lessen the benefits covered in insurance policies employers provide to employees. These are not people covered at all under the Affordable Care Act (Obamacare), but who benefited from the ACA’s required coverage provisions.

“Many people who obtain health insurance through their employers—about half of the country—could be at risk of losing protections that limit out-of-pocket costs for catastrophic illnesses, due to a little-noticed provision of the House Republican health-care bill to be considered Thursday, health-policy experts say,” the WSJ report began. “Insurers in states that obtain the waivers [under the House bill] could be freed from a regulation mandating that they cover 10 particular types of health services, among them maternity care, prescription drugs, mental health treatment and hospitalization.”

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This is not the only surprising analysis that’s appeared in the past 24 hours. A New York Times report noted how the bill will take billions away from K-12 public schools that’s now used for special education, where specialists are hired to help children with developmental disabilities.

“The new law would cut Medicaid by $880 billion, or 25 percent, over 10 years and impose a 'per-capita cap' on funding for certain groups of people, such as children and the elderly—a dramatic change that would convert Medicaid from an entitlement designed to cover any costs incurred to a more limited program,” the Times reported. “School districts receive about $4 billion in Medicaid reimbursements annually.”

There are other stunning summaries of the bill that is coming before the House. Its broadest provisions deregulate the health insurance industry, eliminate the ACA’s patient protection standards, eliminate cost controls and subsidies, and set the stage to turn government-delivered care for poor people into a system of rationed benefits and coverage. Those recipients include the most vulnerable elderly and children, not just poor adults.   

These results flow from the bill’s specifics, which according to a new Times analysis, repeals the Affordable Care Act’s individual mandate to have insurance coverage; repeals the requirements that employers provide insurance; repeals subsidies that help low- to middle-income families pay for policies after 2020; repeals the income tax surcharges that generated those subsidies; lets states keep their Medicaid expansion but turns it into per-capita payments; lets states end requirements that insurers sell policies to people with pre-existing conditions; allows states to waive “essential benefit” requirements; lifts restrictions on what insurers can charge older Americans; offers tax credits instead of subsidies for middle-class families; and encourages health savings accounts.

An economic analysis by Americans for Tax Fairness and Healthcare for America Now, both progressive coalitions, broke down how the Obamacare repeal bill was a massive giveaway to the wealthy, insurers and the drug industry at the expense of people who are now covered or will see premiums skyrocket.

“The GOP plan will deprive 24 million Americans of healthcare coverage and drive up the cost of coverage for millions more, especially older people and people in rural America. At the same time, it will create tax breaks worth about $600 billion that will mostly go to health insurance companies, prescription drug manufacturers and the wealthy,” the summary said. It gave the following breakdown.

The “winners” are, according to the report:

  • Tax cuts: Gives $600 billion in tax breaks, mostly to the rich and corporations;
  • Millionaires: Get a $50,000 tax break each year from repeal of the ACA’s taxes on the rich. A total of $275 billion in tax cuts goes mostly to the richest 2%;
  • 400 richest families: Each gets a tax cut of $7 million a year, on average;
  • Insurance companies: Get $145 billion in tax breaks over 10 years;
  • Drug companies: Get $25 billion in tax breaks over 10 years;
  • Richest 2%: Get a $117 billion tax cut by eliminating a small Medicare tax on couples with incomes above $250,000 a year.

The “losers” are:

  • Health care cuts: Takes health care away from 24 million Americans;
  • Low-income Americans: Loss of $275 billion in revenue from wealthy tax cuts plays a big role in 14 million low-income kids and seniors losing Medicaid coverage;
  • Workers: 7 million will lose health care coverage from their employer;
  • Older Americans: Health insurance companies could increase premiums by up to $13,000 for older Americans;
  • Patients: No protections from huge drug price increases by pharmaceutical companies;
  • Medicare beneficiaries: Loss of $117 billion in revenue from wealthy tax cut shortens Medicare’s ability to pay full benefits by three years.

The bill was brought to the floor before a new Congressional Budget Office analysis, which is likely to show that more than 24 million Americans will be harmed by the legislation.

Steven Rosenfeld is a senior writing fellow of the Independent Media Institute, where he covers national political issues. He is the author of several books on elections, most recently Democracy Betrayed: How Superdelegates, Redistricting, Party Insiders, and the Electoral College Rigged the 2016 Election (March 2018, Hot Books).