Trumpcare: A first look at the American Health Care Act

20170314110000, Brenda Lau
At present, it appears that the Republicans have written a bill that worsens the many problems of the ACA.
During his run for president, Donald Trump promised that Republicans would repeal the Affordable Care Act (ACA) and replace it with "something terrific." When he won, Americans have been waiting on his promise.

Finally, last Tuesday, the Republicans unveiled their plan, which House Speaker Paul Ryan had carefully crafted and proposed. But despite its patriotic name, the American Health Care Act was so disastrous that it was attacked from both left and right wings for the past week.

The Republicans have succeeded in writing a bill that worsened the problems of the ACA, as the only citizens who seem to benefit from the bill are the wealthy due to a large tax cut.

Simply put, the cost of healthcare is increased by taking health coverage and security from Americans, whilst causing damage to the insurance market at the same time, so that a tax cut can be applied for the affluent.

Reversing Medicaid expansion and implementing a flat tax credit

ACA's expansion of Medicaid that is currently believed to be helping an estimated 14 million more Americans has been reversed. The GOP bill will be maintaining the expansion until 2020, but after that, millions will be kicked off the program.

To make matters worse, Medicaid's guarantee of coverage is set to be replaced with a "per capita allotment" and "flexibility" for the states, therefore states can reduce benefits and remove coverage from the citizens.

The bill also replaced ACA's insurance subsidies with a flat tax credit, but the minimum tax credit begins at USD2,000 for a young person, going up to USD4,000 for those in their 50s and 60s. This means, if premiums rise, it just makes health insurance more unaffordable, especially for low-to middle-income citizens.

Repealing individual mandate and crippling the individual insurance market

ACA's individual mandate guarantees coverage for those with pre-existing conditions, despite its unpopularity. The law required citizens to have health insurance, fining those who do not. The GOP plan repealed that, but stated that as long as "continuous coverage" is maintained, citizens can be insured despite their pre-existing conditions.

If there are lapses in coverage, a 30% penalty is enforced -which lasts only for a year and is paid to the insurance company - and coverage is issued again. Experts say this poses a big problem that can lead to the individual market to collapse.

Younger citizens can avoid paying for insurance until they fall sick, as paying the 30% penalty will be more cost-effective in the long run. This confines risk pools to older and more chronically ill citizens, leading premiums to skyrocket, insurers to flee and the market to eventually collapse.

But for older citizens, the Republican bill allows insurers to charge them five times as more than younger citizens - yet only providing them twice as much in a tax credit. It also allows states to set their own ratio. Previously, the ACA capped it at three times.

Healthcare professionals urge AHCA to be reformed

The Republicans have also been frustrated by with the lengthy period of retroactive coverage as the ACA extended the life of the Medicare trust fund. With the huge tax cut for the top 0.1% of USD195,000, it will cripple the ACA, which was paid partially by a previous tax increase on the well-off.

This means the trust fund will be depleted by four years, and will need changes to the program such as a tax increase or cuts. This will provide a reason for the Republicans to repeal the program.

Professional organisations such as the American Nurses Association, Association of American Medical Colleges, American Hospital Association, and Children’s Hospital Association, among other physician groups and all major hospital groups, have criticised the phasing out of the Medicaid expansion and elimination of subsidies for low-income Americans as it would mean many people are left with inadequate coverage.

“We urge you to oppose the American Health Care Act because it would weaken key gains in coverage and consumer protections and lead to fewer people having access to affordable coverage,” Dr. Nitin Damle, American College of Physicians president wrote in a letter to Congress.

The tax cuts also mean pharmaceutical companies and medical-device manufacturers will mean loss in revenue for the government, which mean cuts for federal health programs and consumer-protection oversight. MIMS

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Sources:
http://www.businessinsider.my/what-doctors-think-of-house-gop-obamacare-replacement-plan-2017-3/?r=US&IR=T#lWHZOCYpSOKOR05L.97
https://www.theatlantic.com/health/archive/2017/03/physicians-patients/519036/
http://www.insurancejournal.com/news/national/2017/03/07/443796.htm
https://www.nytimes.com/interactive/2017/03/06/us/politics/republican-obamacare-replacement.html?_r=0
https://www.statnews.com/2017/03/09/medicaid-overhaul-gop/