Friday, February 24, 2017

The Joke That is the Republicans Health Care Plan

Politico is reporting that they have a draft document of the Republican health care plan.  The details are laughable.

Let's review the "three-legged stool" that is the ACA.  To cover people with pre-existing conditions, we needed to expand the pool of insureds.  This led to the individual mandate.  And to help people buy insurance, the government provided subsidies.

How do the Republicans deal with this?

The legislation would take down the foundation of Obamacare, including the unpopular individual mandate, subsidies based on people’s income, and all of the law’s taxes. It would significantly roll back Medicaid spending and give states money to create high-risk pools for some people with pre-existing conditions. Some elements would be effective right away; others not until 2020.


In place of the Obamacare subsidies, the House bill starting in 2020 would give tax credits — based on age instead of income. For a person under age 30, the credit would be $2,000. That amount would double for beneficiaries older than 60, according to the proposal. A related document notes that HHS Secretary Tom Price wants the subsidies to be slightly less generous for most age groups.

Subsidies are the only reason why a majority of the current insureds can buy insurance.  Without them, most people will be driven from the market.  For example, in the program's second year, 90% of the participants qualified for some type of subsidy.  The $2000 tax credit will only pay far -- at most -- a few months of coverage.   Removing the subsidies means people will have to pay for insurance entirely out of pocket -- which most current participants can't do.  So, they're gone from the market. And if people can't buy insurance, they have to pay a 30% penalty when they re-up their coverage.  This penalty will guarantee that those who couldn't buy coverage before most certainly won't buy coverage again.

And high-risk pools -- an idea that has bever worked -- are back.

So, the Republicans clearly want people to not have health insurance.   A