By ED FINKELSTEIN
The proposed changes in the Affordable Care Act (ACA aka Obamacare) being offered by the Republican Party in its new Trumpcare plan, has several basic principles at its core:
While this is simplistic, it’s pretty much the reality when you look at the broader picture of what Trumpcare is, and what it does…to us, the average American worker and family, union and non-union alike.
KICK IN THE PANTS
Oh, by the way, there is a real kick-in-the-pants for union members whose unions were able to negotiate decent health care benefits (the Republicans cleverly call it a “Cadillac tax” to make it sound more palatable): your health care fund gets the “privilege” of paying a special extra tax which will undoubtedly force many plans to reduce benefits or increase your out-of-pocket deductibles. But the R’s made a concession – after all, many blue collar workers voted for them – the penalty doesn’t kick in until 2020! Something to look forward too, right?
PLEASE SIT DOWN BEFORE GOING FURTHER
Here’s a basic primer on the R’s proposed plan, taken from a number of sources. Please sit down while reading:
Help to buy insurance: Instead of direct subsidies for those with the greatest need, they will now be age-based tax credits. The new law is geared toward younger, wealthier people — they get the most assistance. While the subsidies will be higher for older people, they are actually disadvantaged because insurers will be able to charge them as much as five times more for the same coverage.
Oh, and on the issue of tax credits, you need to have a job and an income in order to be able to use the credits to buy health insurance. Credits are highest for individuals earning $75,000 or $150,000 for families. After that, they phase DOWN.
For low-and middle-income individuals and families who don’t receive insurance through work or a government program, credits are between $2,000 and $14,000. Know what kind of health insurance you can buy for $2,000?
The Wall Street Journal estimates this approach will kick off more than 10 million people who now have health coverage.
Added cost to buy: if you drop or lose your health insurance for more than two months and decide you need it back, there’s a 30 percent added surcharge.
Thinking about changing jobs? If your new employer’s insurance doesn’t kick in for a few months, you’re paying the 30 percent added to the cost of your premium.
This is disincentive for someone who’s lost insurance to get it again, unless they are actually sick. Which means sicker people sign up, which health insurance companies are going to hate, and it’s going to drive UP the cost for everyone.
Medicaid to be frozen: After Dec. 31, 2019, no more enrollments. Again, the poor and underemployed are screwed. If someone gets a new job and their income goes above the eligibility limits but then loses that job, they can’t get back.
Medicaid has been a financial lifeline not just for low-income families, but families who have kids with disabilities and older people who need long-term care.
States to make the decisions: Medicaid dollars will flow to the states as block grants, allowing them to make decisions on who gets Medicaid help. Good luck to poorer Missourians. The Republican-controlled legislature has already made it clear: if you’re poor, you must be lazy because you don’t have a good job.
Health Savings Accounts: You can put more into a health savings account (HSA), which is basically a tax break for wealthier people. HSAs can’t replace health insurance, but if you can afford to save a lot in them, you get great tax benefits.
Insurance across state lines: Supposedly to create a “dynamic market” and increase competition and thus reduce health care costs. Notes a Georgetown University study of states that already allow that “to find out if those laws had, in fact, provided consumers with more affordable choices, as promised, the unequivocal answer? No. Not even close.
Even if across state line sales did work as intended, the outcome would worsen access to coverage for people with pre-existing conditions – people that Trump during his campaign promised to protect.”
Creating ‘high risk’ pools for the seriously ill to cut costs: “They didn’t work before the ACA and they won’t work after it is repealed,” states the Georgetown University report.
It notes that such coverage was unaffordable, coverage that was offered didn’t cover the care needed, most of the pools excluded pre-existing conditions for up to a year, coverage was limited, out-of-pocket costs were high, and in many states, enrollment into the pools was capped.
BUT THERE ARE SOME POSITIVES
This is a two-edged sword. While young, healthy people will decide not to buy insurance, those who are sick will ultimately pay more because the overall insured pool will be smaller with sicker people.
REPUBLICAN PLAN: ‘INSANITY’
Sabrina Corlette, professor of the Georgetown University Health Care Policy Institute, sums up the Republican replacement plan perfectly:
“They say the definition of insanity is doing the same thing over and over again and expecting a different result. If that’s so, then we have a textbook case in the Trump transition team’s proposed ‘replacement’ of the Affordable Care Act (ACA)…
“The American people voted for change in this election. Unfortunately, when it comes to health care, the Trump transition team is offering them a set of tired, old, and failed policies.”
(A variety of sources were used to consolidate this summary: Center of Health Insurance Reforms of the Georgetown University Health Policy Institute, PolitiFact, Washington Post, PBS News Hour and Daily Kos.)
“The GOP is replacing Obamacare with Trumpcare, which will destroy the best aspects of the ACA while imposing one of the largest tax increases on the American middle class ever leveled by a political party,” said Mike Casey, chair of Unite Here’s health care task force.
A broader health task force brings together a wide-ranging coalition of unions, businesses and civic groups to lobby against a part of the Trumpcare scheme that would tax all of workers’ health care benefits that currently are not taxed. Company payments of workers’ health benefits are an “exclusion” from companies’ taxable income.
There is still a proposed tax on union health care funds that has been postponed until 2020 called a “Cadillac tax” for plans with solid benefits.
The GOP is considering a “cap” on the tax rather than eliminating it totally. If this happens, it could cost the average workers $3,860 yearly in new taxes by 2026.
“Over 177 million Americans who depend on employer- based health care for their health and well-being will soon be hit with a double-whammy by the GOP Trumpcare plan: A huge new tax on their health benefits followed by higher premiums, higher deductibles and less access to quality care,” Casey said.
He added: People would get hurt in multiple ways: Having to pay higher taxes, having to buy health insurance with larger holes and higher deductibles or watching their employers cancel coverage altogether.