Senate Health Care Plan Hurts Republican Voters Most
The Senate health care plan released last week, dubbed the “Better Care Reconciliation Act,” will, if passed, be the Republican take on health care. After a highly publicized fight to pass the AHCA in the spring, Scott Wong of The Hill reported last Thursday that House leadership planned to approve whatever version of health care legislation passes the Senate, bypassing what could have been a messy and contentious reconciliation process between the two pieces of legislation. In other words, the Senate bill is the future of health care in the United States, and a crucial, once in a generation opportunity for the Republican party to demonstrate their policy acumen.
But, after years of complaining and campaigning against Obamacare premium hikes and over-regulation and winning a Presidential election on the backs of low-income, older Americans, Republicans have managed to craft a bill which raises premiums significantly, includes a pseudo-mandate to buy health coverage, and cuts taxes for the richest Americans at the grave expense of the poor.
Let’s look at premiums first, the most obvious metric of success to the average American. In their key voting demographics, Republicans have truly made a mess of premium reduction. The Kaiser Family Foundation estimates that the average marketplace enrollee would end up paying health care premiums 74% higher than under Obamacare, and older enrollees (55 and up) would pay an average of 114% more for their health care. What do these numbers look like in dollar values? A 60 year old making $40,000 a year in Bibb County Alabama, an area where 76% of residents voted for Donald Trump, would see a $1,830 decrease in their health care tax credit, a $6,900 (169%) increase in premiums for a benchmark silver level plan, and a $5,420 increase in a bronze level plan. In fact, 60 years olds making $40,000 across the US would nearly universally see a hike in their premiums. If one compares this map of projected premium hikes under the BCRA to the 2016 election county results map, it seems as though Republicans are nearly deliberately shooting themselves in the foot with voters key to their recent victory.
And it is not just pricing which will hurt Republicans in the midterms. Voters opposed to the controversial individual mandate of Obamacare (a conflict which went all the way to the Supreme Court) will not be pleased with the Republican “fix” they voted to get. Under the BCRA, the individual mandate is repealed in name, but Republicans have added a significant penalty for enrollees who allow their health coverage to lapse, coverage which many Americans were forced to purchase under threat of the ACA penalty. So if you bought health care to avoid the tax penalty of the ACA you can breathe easy under the Republican plan, unless of course you need health insurance at any point later in your life in which case you will be stuck with inflated premiums penalizing your lapse in coverage. The only other significant regulations eliminated by Republicans are those of the ACA preventing insurance companies from creating high-deductible, low-coverage plansfor low-income Americans.
The question really becomes who does this bill benefit? And the answer is in the tax cuts, nearly half of which go to the top 1% of households, making $875,000 a year or more. The $700 billion in tax cuts mandated by the bill are very unevenly distributed and unsurprisingly (for the republicans) anti-populist. Americans in the middle 20% of incomes would receive a tax break of about $280 a year; Americans in the lowest 20% of incomes would receive just $180 a year. But the top 1% would receive a tax break of about $45,000 a year. The bill also sees the repeal of the net investment tax, the Medicare payroll tax, and a delay of the Cadillac tax (on expensive insurance plans for the richest Americans) until 2026.
It is quite clear that nearly all of Republican voters in the 2016 election with the small exception of the super-rich have voted against their interests, falsely believing that the party would curtail ACA premium hikes and eliminate penalties for a lack of insurance. Is this really a plan to benefit the American people, or is it for the few wealthy Americans who will fund Republican bids for reelection in coming years? The answer is in the bill, and if the Republicans manage to pass the BCRA as is, their most significant policy contribution in years will result in the financial devastation of millions of Americans.