Obamacare replacement would have dramatic impacts on Western Slope
If passed into law as is, the proposed federal successor to Obamacare that’s presently making its way through the House of Representatives would mean serious price hikes on the already inflated costs of the Western Slope.
The American Health Care Act, introduced in the U.S. House last Monday, is the conservative-driven approach to repealing and replacing the Affordable Care Act, which reformed the nation’s health-care system and went into effect in 2010 under the Obama administration. Since that time, Republican members of Congress have rallied against the ACA, consistently committing to reversing the law as soon as possible. Doing so has proven more difficult than may have been expected.
“Nobody knew that health care could be so complicated,” President Trump said the Monday before the AHCA’s unveiling, following up on a campaign promise to settle on a revised solution for the country. “We’re going to repeal and replace Obamacare and get states the flexibility that they need to make the end result really, really good for them.”
Who benefits, according to an analysis by the nonprofit Kaiser Family Foundation on the current language of the bill, appears to depend greatly on where you live. Because the AHCA offers flat-rate tax credits mostly using age to determine the amount rather than the sliding-scale subsidies based on the federal poverty income levels of Obamacare, the law would establish clear winners and losers.
The new plan would allow anyone bringing home less than $75,000 annually a credit. For instance, someone between the ages of 27-30 would receive $2,000; 30-40 would receive $2,500, and so on, topping out with a $4,000 credit for those 60-and-up. An individual or family’s geography, with which both Colorado’s mountain region and rural Eastern Plains communities are familiar, has a dramatic impact on the cost of health-care premiums, but would not be taken into account under the AHCA.
“Some issues that are specific with the mountain area make this a worse fit,” said Bethany Pray, a health-care attorney with the Denver-based Colorado Center on Law and Policy. “There’s a really big difference, and a sizable impact on the Western Slope, because those tax credits don’t change if insurance, which is based on the formula of second-lowest cost silver plan in area, is more expensive there compared to the Front Range.”
The national Kaiser survey displays subsidy comparison projections for the year 2020 for different age and income brackets. It shows that a 27-year-old in Summit making $30,000 would see more than a $1,000 decrease in tax credits, from $3,030 under the ACA to the flat $2,000 with the AHCA. Meanwhile, in Colorado’s larger population areas, where insurance premiums are already considerably lower, that same person would see an $820 increase in credits in Boulder, and $850 more in Denver.
In the middle-age demographic, of 40-year-olds making, say, $40,000 each year, as an example, a Summit County resident would see a $360 increase of the benefit with the $3,000 flat-rate credit, while individuals on the Front Range would still see significantly more, up more than $2,600 each in Boulder and Denver. Those 60 and up, perhaps on a fixed retirement income of $50,000 and on Medicare after age 65, would see a slight decrease in credits, while someone in those age and income ranges would see their subsidies cut by more than half — from more than $9,000 under the ACA to the uniform $4,000 with the new plan — in Summit. Such massive reductions for the elderly are why the American Association of Retired Persons, or AARP, quickly voiced its objection to the AHCA, calling it “harmful legislation.”
“Before people even reach retirement age, big insurance companies could be allowed to charge them an age tax that adds up to thousands of dollars more per year,” Nancy LeaMond, AARP’s executive vice president, said in a statement this past Tuesday. “Although no one believes the current health-care system is perfect, this harmful legislation would make health care less secure and less affordable.”
The new health bill retains two key provisions from the ACA, continuing to allow young adults to remain on their parents’ policies until turning 26 years old, as well as forbidding insurers from using preexisting conditions to deny someone from obtaining a health-care plan. For those states that opted to expand Medicaid benefits, though, for low-income households — of which Colorado is one — that federal assistance would be eliminated after 2020.
U.S. Sen. Cory Gardner, R-Colo., who has opposed the ACA, joined three other Republic senators in sending a March 6 letter to Senate Majority Leader Mitch McConnell, R-Ky., noting concerns over a draft of the health-care overhaul not adequately fending for those now covered by the Medicaid expansion. About 1.3 million Coloradans receive health coverage through Medicaid, with an estimated 407,000 — roughly 1,900 adults and 400 children residing in Summit — of them achieving it through the ACA’s broadened rules.
“This is something that we need to find a better solution for,” Gardner said of Obamacare during a telephone town hall last Wednesday, later adding of Medicaid, “the states (need to) have adequate flexibility to run a program the way they need to in order to make this work and cover people.”
The new health-care proposal also includes conditions like doing away with the health-insurance mandate, which forces those not covered to pay an annual tax penalty and instead swapping it for a 30-percent premium increase for up to a year as a disincentive to drops in coverage of more than 63 days, possibly ceasing the tiered medal (gold, silver, bronze) structure of plans, and also defunding Planned Parenthood for a year. Because the bill is being sent through the federal budget reconciliation process, it would need only a simple majority in each Congressional house to pass, and could not be filibustered.
House Speaker Paul Ryan, R-Wis., said he intends for a full House vote by the end of March. The bill already received approval from both the required House Energy and Commerce and Ways and Means committees late last week, despite not yet having a Congressional Budget Office score that indicates the actual cost of the bill. Taking a committee vote before an assessment of the neutral, bipartisan budget office to achieve such a brisk pace is a tactic Pray called atypical.
McConnell has pledged to a Senate floor vote before the legislative break on April 7, though, and to Trump’s desk shortly thereafter, assuming the bill doesn’t undergo major changes. Efforts persist in the state legislature as the AHCA is pushed through U.S. Congress, and local officials maintain worries over what such rapid ratification could mean for Summit residents already paying an arm and a leg for health insurance under the current system.
“I think Congress is playing Russian roulette with people’s lives right now,” said County Commissioner Dan Gibbs, a Democrat. “They need to think very carefully and be very cautious about what is the longer term for the American people. Because big picture, neither the ACA and AHCA talk about curbing the cost of health care to individuals. It’s silent on that, and that’s what’s killing us in the mountain communities.”
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