Even if McConnell somehow manages to revive the bill in the coming weeks and put together the fifty votes that he needs to get it through the Senate, that broader failure will remain a problem for him and his party. If they end up passing this bill or something like it, they will be betting their future on a reform that cannot deliver what Donald Trump promised during the election campaign and what Paul Ryan and his colleagues promised last December: reasonably priced access to health care for every American. Over time, political pressure would mount for the restoration of Obamacare, or even for a public option available to everyone.
Conservative supporters of the Senate bill disagree, of course. Writing in the Washington Post over the weekend, Avik Roy, a former health-care adviser to Mitt Romney, said that passing this legislation would “represent the greatest policy achievement by a Republican Congress in generations.” It would create “a thriving, consumer-driven individual insurance market, with as many as 30 million participants, available to the healthy and the sick and the young and the old, whose successes will lay the groundwork for future efforts at entitlement reform.”
The Congressional Budget Office’s analysis of the Senate bill, which was released on Monday, offered a very different picture. If the bill were signed into law, the C.B.O. said, tens of millions of Americans would eventually be added to the ranks of the uninsured. Many others would face higher premiums, deductibles, and out-of-pocket limits. Older and poorer people, in particular, would find it harder to pay for health care.
Here’s an example plucked from a table at the back of the C.B.O. report: Under the Senate bill, a typical sixty-four-year-old person who earns $26,500 a year would see his or her insurance premiums leap from $1,700 to $6,500. In addition, this person could well see his or her annual deductible jump sharply, from about $3,500 to $6,000.
In Ryan’s view of the world, people in this position would still have “access” to health insurance. If they chose not to take advantage of it, that would be their “choice.” But, of course, it is simply unrealistic to expect people earning $26,500 a year to spend $12,500 on health care, unless they are seriously ill. Among people aged fifty to sixty-four who earn less than $30,000 a year, “the share without insurance coverage would more than double from about twelve per cent to twenty-six per cent," William Galston, a centrist Democrat who served in the Clinton Administration, noted on Tuesday, in the Wall Street Journal.
This is just one example of the Senate bill’s shortcomings, but the problem is a general one. Far from providing universal coverage, McConnell’s reformed insurance market would take the country back to a system where the availability of health care is dependent on an individual’s ability to pay. That, after all, is what markets do.
If you are serious about providing universal health care but you also insist on maintaining the private-insurance model—as most conservatives do—the only realistic way to deal with the problem is to direct public money at it: give people of modest means generous subsidies to help them buy policies, and give “cost-sharing” payments to health insurers so that they don’t hike up co-payments and deductibles too much. Such measures are insufficient, though. You also need to find a way to make younger, healthy people enroll, to make the risk pools broad enough. And, for those too poor to buy even heavily subsidized coverage, you need to provide an ultra-low-cost public option.
The Affordable Care Act did all these things, and it still encountered problems. Over all, it was a big success: between 2010 and 2017, the share of Americans under the age of sixty-five without health insurance fell from roughly eighteen per cent to roughly ten per cent, according to C.B.O. figures. However, the public option—the expansion of Medicaid—accounted for about two-thirds of this decline. The private-insurance exchanges, even with all the carrots and sticks that the government employed, didn’t attract as many people as anticipated. In some parts of the country, insurers have pulled out of the private-insurance exchanges, competition has declined, and premiums have risen sharply.
But, instead of building on the gains of the A.C.A. and attempting to fix its problems, the bill proposed by McConnell would make things worse. Over-all federal spending on health care would drop by $1.02 trillion dollars over ten years. Although the bill would still offer tax credits to low- and middle-income people for the purchase of insurance, these credits would, in general, be less generous than those available under the current law, and the income cutoff for financial-aid eligibility would be lower.
The biggest spending cuts would be applied to the most successful part of the 2010 reform: the expansion of Medicaid, which would be gradually reversed. Relative to the current policy baseline, the public-health-care program would lose seven hundred and seventy billion dollars. Consequently, according to the C.B.O., if the Senate bill were to pass, fifteen million fewer people would have coverage under Medicaid by 2026, and practically all of them would be low-income people.
It’s not just a matter of the Republicans looking to make budget cuts, although for a party dedicated to the goal of cutting taxes, especially for high earners, that is clearly an important part of the story. By abolishing the individual mandate, the Senate bill would encourage many young and healthy people to skip getting coverage. Almost immediately, according to the C.B.O., the number of uninsured would rise by fifteen million—a jump of almost sixty per cent. Over time, lower enrollment rates would create all sorts of other problems.
The conservative counter-narrative is that, by stripping away regulations, encouraging competition between insurers, and empowering consumers, the bill would unleash the magic of the market. A fast-food worker earning fifteen thousand dollars per year who lost access to the Medicaid plan he enrolled in a couple of years ago could buy a private plan, taking advantage of the government tax credits in order to set his monthly premium around three or four hundred dollars.
But, for someone who makes $1,250 a month, before payroll taxes and other deductions, three or four hundred dollars is a huge amount to pay out, especially if it is going toward an insurance policy that comes with an annual deductible of $5,000 or $6,000. Like the sixty-four-year-old in the earlier example, the fast-food worker would surely “choose” to remain uninsured.
In reality, of course, the only party here that is really exercising choice is the Republican Party, which is refusing to accept the principle of genuine universal access to health care—a principle that virtually every other developed nation in the world recognizes. Until the Republicans and their conservative backers surmount their objections to this principle, they will be obliged to try and foist upon the country policies that can only do harm to many of their own supporters. After the July 4th break, they will doubtless hurry back to this task.
Author: John Cassidy