The conservative complaint that the Affordable Care Act led to higher out-of-pocket costs has been so deeply ingrained into GOP Obamacare repeal talking points that even President Trump—he of “Nobody knew that health care could be so complicated” fame—managed to work it into his tweet storm messaging.
But like other aspects of the health care bill Republican lawmakers are currently pushing, their approach would likely make the problem they raised constantly to bash Obamacare actually worse.
The reasons are wonky but incredibly important, because consumers will likely see their deductibles and co-pays rise if the Senate health care overhaul bill, the so-called Better Care Reconciliation Act, goes into law. And the way the Senate proposal is structured, it also means that the tax credits offered under the GOP bill give consumers get significantly less bang for their buck, even as they largely follow the model of the ACA subsidies.
The key provision is the Senate bill’s proposal to change what is known as the actuarial value of the benchmark plans that the tax credits would be pegged to. Under the current law, the tax credits are formulated according to the second lowest premium rate for a “silver plan” in a given area, and silver plans are required to have a 70 percent actuarial value. That means that that the insurer will pay 70 percent of medical costs a typical consumer incurs, while leaving the consumer to pick up the tab for the rest via deductibles, co-pays or other cost-sharing mechanisms.
The Senate bill lowers this base level to 58 percent actuarial value, which is at the bottom end of what are known as “bronze plans” currently under the ACA. By the math of Kaiser Family Foundation vice president Larry Levitt, the value of the premium subsidies are therefore reduced by around 15 percent.
In English: Changing the benchmark to a 58% AV plan would likely reduce premium subsidies by about 15% or so. https://t.co/Ksu2wDQmSH
— Larry Levitt (@larry_levitt) June 21, 2017
On the front end, this will make it look like premiums are lower under the GOP plan. But the reduction in actuarial value shifts that burden elsewhere, likely to co-pays and deductibles. Consumers on the older end of the spectrum will be hit especially hard by this change, due to other ways the Senate bill tweaks ACA limits regarding age and how the tax credits are doled out.
This tweak is coupled with a state waiver provision of the bill that will allow states to opt out of the ACA’s limits on cost-sharing.
A 2015 brief by the Urban Institute found that with plans at 60 percent actuarial value—the bottom limit at the time under the ACA—the out-of-pocket costs would shake out to be around $6,850 for single policies and $13,700 for family policies.
If u think that folks making $10k/yr shld pay $200 for a plan where they pay 1st $7,500 in care will fix healthcare, have I got a bill for u
— John Graves (@johngraves9) June 22, 2017
Under the ACA, at least those deductibles were defrayed for low-income consumers by insurer subsidies known as cost-sharing reduction payments. But under the Senate Republican plan, the cost sharing reduction payments will be repealed at the end of 2019, and it’s left up to the states to enact programs that could assist low income people with these deductibles.
There is a conservative philosophy that right-leaning health policy wonks will offer in favor of higher cost-sharing. They are argue that if consumers are exposed more directly to health care costs, they’ll be more selective about what services they receive, prompting market forces to drive down the prices.
This rationale was no where to be found when Republican lawmakers pointed to out-pocket-costs to slam Obamacare, even as they intended to push a plan that would only exacerbate that problem.
What else would expect from complete hypocrites? All their attacks on the ACA were based on rising costs, deductibles and not enough choices. Their actions however were to make all those problems worse, when they knew what was needed to fix all those problems.
They did worse than not doing anything, they sabotaged it. Their attacks called for liberal solutions while knowing all along they would do the exact opposite, and Trump’s cheering morons had no clue what fools they were
It’s bait-and-switch, and they’ve got an expert salesman when it comes to flimflamming.
Ah, the Sacred Free Market (home of the Eminent and Majestic Job Creators). This works great for beer and cars. But is forcing individuals and the irrational free market into being the deciders of health care service choice a good thing? The choice of health services should be driven by positive health outcomes, and that can’t be evaluated by the free market/consumers. Only science can evaluate that.
The GOP: they should follow the 1st commandment of their first religion and ditch their worship of their other religion, the free market.
I believe I hear some peasants sharpening sickles.
These a$$hat$ are really big on the bible. They’d do well to remember Numbers 32:23 –
The specific context isn’t too far off this debate – it concerns the conquest of Canaan, and hence governance somewhat more generally. I suppose it depends on what the peasantry view as “their word.” It seems pretty clear (at least to me) that “their word” is seen to be that they would “fix” the problems of the ACA – expense, mandatory health insurance, lack of choice in providers, etc. – and not change the goodies – community rating, caps on age differential premiums, mandatory issue.
Any thinking person can see those things are in pretty serious conflict, but anyone not among the 1% who votes GOP isn’t a thinking person.
Republican’ts also have big plans to sell you a brand new car for only $199!*
(*Of course if you want doors, wheels, a steering system, brakes, a gas tank, an engine and a transmission you’ll have to pay another $30,000. And, no, you don’t get to pick and choose among the options…)