Yesterday, House Republicans released their long waited plan to repeal and replace the Affordable Care Act. I’ve tried, but it’s early and so far I can’t find a good summary of what the Republicans propose without reading multiple pages of text. However, it does sound like they will have a fight within their own ranks with some Republican lawmakers like Senator Rand Paul declaring it “dead on arrival” and the Tea Party caucus in the House rebelling, so I probably shouldn’t bother looking at something a plan is bound to be amended to death. However, “the reveal” of what we can call the first draft of the Republican bill should cause all of us to consider the affect “Trumpcare” will have on everyone in the country.
Whatever bill the Republicans in Congress ultimately choose, if such an agreement is even possible, we know for sure that millions of Americans currently covered by Obamacare will no longer have insurance. We can also safely assume that that the Republicans will remove the mandate which currently encourages everyone to buy health insurance. They have been raging about the mandate for years. On the other hand, be assured that the Republicans will preserve the ACA rules which prevent insurance companies from denying coverage for pre-existing conditions and which allow adult children to remain on their parents’ plans until they are 26. Even the Congressional Republicans are not stupid enough to do away with those very popular provisions.
Progressives are very concerned that many of those who will lose their health care coverage will be the most vulnerable and needy among us, and we should be. This will also be the most the most risky aspect of any plan that Trump and the Congressional Republicans will ultimately put together. Remember that Trump promised a “Great” plan “with health care coverage for all”. However, it is readily apparent given what we know of this first draft, they are willing to assume that risk and many will lose their coverage. The point I want to make is that we need to not only be concerned about the most defenseless among us. Those of us who will continue to be insured need to be concerned about our own health care costs as well.
When people without insurance are admitted to a hospital and they ultimately can’t pay their bill, or when they go to a hospital emergency room to get treated for something that would normally be treated in a doctor’s office, again because they can’t pay, the hospital has to initially absorb the cost of treating them. However, ultimately the hospitals make up for those losses by charging more for the services they supply to those of us who have insurance and can pay. Insurance companies are not going to absorb those additional costs so they will in turn pass them on to the insured and our insurance rates premiums wil go up.
That’s why since 20 million additional Americans are insured under the ACA, health costs have increased at a much slower rate. In fact, health care price inflation is at its lowest rate in 50 years. So when the Republicans plans reduce the number of those insured, the costs of health care and insurance premiums will start increasing again at a much faster clip. The more people who lose their insurance, the faster those costs will increase for the rest of us.
However, Trump and the Congressional Republicans are not done adding additional price increases for your health insurance policy. Probably the most costly provision of the ACA for insurance companies is the elimination of the preexisting condition clause. As discussed earlier, this ACA provision is too popular for Republicans touch. When an insurance company takes on a new policy holder with a serious preexisting condition such as cancer, a heart aliment, etc., they can inherit a losing proposition. In such cases it is almost certain that the company will pay out more in benefits to that person than they will ever receive back in premiums and, as you know, insurance companies are not in the business of losing money. So unless insurance companies can make up those losses elsewhere they will have to charge everyone more for health insurance and the cost of your insurance will increase yet again if this provision is maintained and there aren’t other provisions in the Republicans’ bill which will offset those costs.
One of the ways that the ACA is currently designed to offset the cost of eliminating the preexisting condition clauses is the individual mandate which requires everyone to enroll in a health insurance plan or pay a fine. This provision specifically encourages younger people to buy health insurance. Young Americans, like young people the world over tend to think that they are immortal and won’t get seriously sick or injured. Many of them would also prefer to spend their money on more entertaining items, so they normally are the least statistically likely to buy heath insurance. The mandate encourages them to get insurance coverage when they otherwise would not do so.
As noted earlier, Republicans are intent of eliminating the unpopular individual mandate. As a result, young people will be far less likely to buy health insurance under a Republican plan. Because they are actually less likely to get seriously ill, they cost less to insure and their premiums help the insurance companies make up for the costs of insuring older people and those with preexisting conditions. When the mandate is eliminated insurance companies will turn to another way of making up their loses due to preexisting conditions. The elimination of the mandate is another reason why the cost of health insurance for the rest of us who purchase insurance will rise more quickly than usual.
However, the hidden costs of eliminating of the health insurance mandate do not end there. Young people are among the greatest risk takers and are much more likely to become involved in dangerous activities which sometimes result in serious injuries. They are also likely to have very little saving which can be used to pay for very large hospital and doctor bills. Therefore, if they are uninsured and get into serious accidents, they are more likely to be unable to pay for their very costly medical care. Instead the cost of their care will also be passed on from the hospitals to the health insurance companies in the form of higher medical costs. And then the insurance companies will pass those costs on to those of us who are insured in the form of higher premiums.
With the fight expected in the Republican ranks over this bill, there is no way to predict its final contents. However, you can be sure that they will try to sell the final product by advertising that it will bring down the cost of health insurance by creating more completion by allowing people to choose their own policies directly from the insurance companies and allowing companies to sell across state lines. That’s just plain bullcrap. Health care is not a competitive industry and not subject to normal competition – it never has been and never will be. Insurance companies have been allowed to sell across state lines in six states for years and not one company has chosen to do so. Heed what I am telling you and get ready to pay much more for your health insurance once Trumpcare is passed and signed into law.