Why the American Health Care Act is Sick or Not, Depending on Who’s Diagnosing It

For those following the politics of healthcare, there has been nothing larger than the Affordable Care Act (ACA/ObamaCare) for the last seven years. Until now.

In the first quarter of 2017 the Trump Administration and the Republican-led Congress put forth the act that is supposed to “repeal and replace” the original social healthcare act.

This is an ever-changing story. The American Health Care Act cleared its initial hurdles by making their way through committee in March, but criticism is growing and pressure is mounting. President Donald Trump has even voiced his concern about the complexity of healthcare. And despite Democrats and Republicans clamoring to tear down this new healthcare wall, estimates released by the Congressional Budget Office on Mar. 13, 2017, suggest the new healthcare bill will mean the loss of coverage for 24 million by 2026, but costs ultimately will come down.

The newly scribed AHCA serves as the quintessential repeal and replace bill that the Republicans have tried to enact since the original passing of the ACA: “After years of Obamacare’s broken promises, we’re proud to put forth a plan that presents a better way for patients and their families,” Rep. Greg Walden, R-Ore., said in his introduction of the bill as the Ways and Means session began Wednesday.

But Rep. Frank Pallone, D-N.J., had a different take. “For seven years, Republicans claimed to have a better way, but it turns out that is nothing more than an empty slogan,” he said. After years of obstructing and sabotaging the ACA, the GOP has offered a plan that is “incredibly destructive to the little guy, the average working man and woman,” he added.

White House Press Secretary Sean Spicer said during a press in mid-March that there is reason to doubt the CBO’s assessments because some of its past projections about enrollment under the ACA missed the mark. “If you're looking at the CBO for accuracy, you're looking in the wrong place,” he said.

Some like parts of the bill because it may stabilize the individual market, like a transition period for consumers to continue to get premium tax credits, and permanently eliminating the ACA’s taxes that it argues “drive up consumer costs.”

However, AHIP is concerned about some of the Medicaid funding proposals included in the bill, saying that some key components, such as the base year selection and annual increases tied to the consumer price index for medical care, “could result in unnecessary disruptions in the coverage and care beneficiaries depend on.”

Both sides are and continue to stand divided on healthcare and the future of its funding. While Washington’s politicians continue trying to act like health and payer experts, some are left to wonder what everyone wants, and what all of this is about, unless it’s just some grand political line in the sand as most things in the US capital have become.

In trying to understand exactly why the new AHCA bill is hated by those on the left and the right, let’s turn to healthcare analyst Jason Shafrin of the blog Healthcare Economist. His analysis points out, in part, why the bill is so unpopular in its present state:

“This provision will result in higher premiums for older individuals. The AARP writes: ‘Before people even reach retirement age, big insurance companies would be allowed to charge them an age tax that adds up to thousands of dollars more per year. Older Americans need affordable healthcare services and prescriptions.’ While it is true that older Americans will receive larger tax credits through AHCA, these credits likely will not offset the additional cost. Thus, AARP is concerned about whether near elderly individuals will be able to afford health insurance on the private market.” It should be noted that the AARP is typically known to be a liberal organization that heavily favored the original iteration of Obamacare.

On the other hand, the Cato Institute doesn’t care for the “premium age band provision” citing “ ObamaCare’s community-rating price controls literally penalize insurers who offer quality coverage to patients with expensive conditions, creating a race to the bottom in insurance quality … allowing insurers to charge enrollees who wait until they are sick to purchase coverage an extra 30 percent (but only for one year).”

The solution, Sharin then notes is a proposal from the American Enterprise Institute, including allowing and encouraging payers to charge individualized premiums that reflect patients’ true healthcare costs. “When insurance is fairly price, insurers will not exit the market and will be incentivized to provide high quality care to the sick rather than trying to get them to leave their plan,” the think tank notes aptly. People with higher potential expenses get charged more. Finally, the government, he suggests, should subsidize premiums based on income and age, as long as individuals have access to a “basic insurance plan.” No word on what that plan is.

Given American’s appetite for coverage for all and the left and right’s battle over just how much entitlement is too little or just enough is the political football that we’re now seeing played in healthcare. With each side on its clearly drawn sides, it’s little wonder why the AHCA is such a hot potato, especially given all the political trouble the ACA caused.

Scott Rupp's picture

Scott Rupp


Scott E. Rupp is a writer and an award-winning journalist focused on healthcare technology. He has worked as a public relations executive for a major electronic health record/practice management vendor, and he currently manages his own agency, millerrupp. In addition to writing for a variety of publications, Scott also offers his insights on healthcare technology and its leaders on his site, Electronic Health Reporter.

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