Health care bill’s harm is far-reaching

After 2,500 days, the American Health Care Act is born. Congressional Republicans’ much-anticipated health care bill may have a similar name to the Affordable Care Act it’s intended to replace, but it would have a dramatically different impact. Despite President Donald Trump’s stated goals of covering at least as many people as the ACA, with more affordable policies, the plan put forward by the House on Monday would cut coverage for millions and make it more expensive for millions more.

But it’s not these obvious changes that are most concerning. There is a great deal about the bill that’s not apparent at first glance. None of it will be missed by the impartial Congressional Budget Office.

First, the tax-credit structure in the bill would not only make health care less affordable for millions, particularly those over 55, it would also destabilize the insurance markets. The ACA pegs tax credits to income levels and, when premiums rise, those tax credits rise along with them, protecting consumers against regional differences and sudden increases in medical costs. This is better for the insurance risk pools, because more people stay in when premiums stay affordable for more people. But take those protections away, as the new bill would, and something perverse but entirely predictable happens: Sicker people keep paying (if they can), healthy people do not, and costs go up.

Second, the bill drops the individual mandate. About as unpopular as vegetables are with my kids, the mandate for individuals to buy insurance nevertheless keeps premiums lower for everyone. Adding a surcharge of 30 percent for those who decide to sign up for coverage after a gap may hurt more than it would help, as it would disproportionately attract sicker people. The bill also would directly increase deductibles and co-payments for millions by eliminating the ACA’s cost-sharing reductions for lower-income earners. As someone who ran a large health-care organization in the private sector and then oversaw the ACA exchanges these past several years, I know how inexorably this all would push premiums higher and lead insurers to exit, as healthier people took their chances without insurance.

But the most lasting effects of this bill would be the significant steps it took toward forcing permanent changes to Medicaid and Medicare. The Medicaid changes are more obvious and dangerous. First, the bill would effectively end the popular and largely bipartisan Medicaid expansion created by the ACA, which extended care to millions of working Americans. Dropping the federal funding contribution for new enrollees after 2020 – and violating a promise the federal government made to the states – would rapidly end the expansion.

More draconian is a permanent capping of the Medicaid program. In my time overseeing the government agency that runs the program, we dealt with many unexpected shocks – Zika, high-cost drugs and the national opioid epidemic, to name a few. Under the AHCA, states would no longer have the resources to manage these crises, with devastating results for our communities. Medicaid pays for nearly half the births and half the long-term care in this country, to say nothing of the millions of Americans with disabilities who rely on it. If the federal government retreats on Medicaid, the repercussions will be felt quickly – by our neighbors and by our care providers and hospitals.

Medicare doesn’t escape unscathed either. The bill would cut several years from the life of the Medicare trust fund, but that’s clearly no accident: The program would wind up right where “entitlement hawks” such as House Speaker Paul Ryan, R-Wis., want it – in crisis. If this bill became law, the speaker would finally be positioned to change Medicare to a voucher program.

Because the bill would reduce coverage and make insurance less affordable, the only way for Republicans to sell it has been to feign a collapse or implosion of the ACA. This is simply false, as independent analysts such as Standard & Poor’s have reported. After one-time rate increases, the exchanges were stable going into the high-stakes game the administration has played by casting uncertainty on the market.

But all this serves the real objective – using the “rescue” of the individual market to make permanent draconian changes to Medicare and Medicaid while pushing forward a major tax cut for high-income earners, insurers, tanning salons and pharmaceutical companies. Some may view this as a good idea. Having overseen these programs, I do not. But no one should argue that we don’t deserve a real national debate, with public hearings, proper CBO analysis and the time necessary to consider the likely generational effects for millions of Americans.