MAY 6, 2017



Trump’s American Health Care Act Could Be Disastrous for Seniors and the Poor


No, the Affordable Care Act or Obamacare was not replaced and repealed on the first day of Donald Trump’s presidency as he promised. In fact, President Trump and the Republican leadership’s American Health Care Act (AHCA) that was supposed to replace Obamacare flopped, dead on arrival in Congress, despite a GOP majority in the U.S. House where it failed under House Speaker Paul Ryan’s charge.

This legislative misadventure

showed Americans just how green the president is in the way of pushing forward major bills, especially one that is as complex and far reaching as healthcare reform. His top-to-bottom strategy that may have worked as a corporate CEO runs contrary to the D.C. culture where collaboration, deal-making, and compromise are the essential hammers to break apart any gridlock, even as president of the United States.

Besides the president’s inapt leadership style, AHCA failed on substance. AHCA’s future spelled doom immediately after the non-partisan Congressional Budget Office (CBO) released its analysis: 24 million Americans would lose coverage over the next 10 years—14 million in the first year alone; 2 million Americans with employer-sponsored coverage would lose it by 2020; 7 million would lose it over 10 years; higher premiums, higher deductibles, and more out-of-pocket costs; insurance premiums would skyrocket by 20% by 2019; $880 billion in cuts to Medicaid funding while giving rich Americans and corporations a $592 billion tax cut.

Besides the health insurance and pharmaceutical lobby, most Americans disapproved of AHCA. A Quinnipiac poll found just 17 percent of Americans approved AHCA; by contrast, 56 percent disapproved of it.

The features of AHCA would have been so disruptive that it was opposed by various health professional organizations, including the American Hospital Association, the American Academy of Pediatrics, the American Psychological Association, and the American Medical Association.

Dr. James Madara, CEO of the AMA, the largest association of physicians and medical students in the U.S., said: “While we agree that there are problems with Obamacare that must be addressed, we cannot support the AHCA as drafted because of the expected decline in health insurance coverage and the potential harm it would cause to vulnerable patient populations.”

AMA was concerned about the plan to stop Medicaid expansion in 2020. Under the AHCA, states that offer the Medicaid expansion would continue receiving federal funds for those already enrolled, but would not receive federal funds as of 2020 for new candidates who only qualify for Medicaid under expansion rules.

“Medicaid expansion has proven highly successful in providing coverage for lower income individuals,” said Madara.

Hawaii’s House delegation Reps. Tulsi Gabbard and Colleen Hanabusa opposed AHCA.

The AARP Hawaii said AHCA threatens the solvency of Medicare and would hurt long-term care and in-home services for seniors.

“The bill gives sweetheart deals to drug and insurance companies while doing nothing to lower the cost of health care or prescription drugs. Instead of this harmful bill, we encourage Congress to focus on protecting and improving Medicare’s benefits and financing; providing access to affordable quality coverage; preventing insurers from engaging in discriminatory practices,” said AARP Hawaii state director Barbara Kim Stanton.

One of the features of AHCA that is problematic for seniors is that it would allow insurance companies to charge older people up to five times more than those younger insured. Under Obamacare, the limit is three times more.

An example of price increase, AARP estimates that a 64-year-old in Hawaii making $25,000 would see a premium increase of $6,791 under the AHCA. A 55-year-old making $25,000 would see a $3,578 premium increase because of the age Tax. The bill is a double whammy for older Americans ages 50 to 64, who are too young for Medicare. Their premiums go up because insurance companies would have free rein to charge older Americans more than everyone else for the same coverage.

AARP Representative Toy Arre Jr. said the age tax in AHCA could cost older Americans up to $13,000 a year.

In addition to changes to how much insurance companies can charge based on age, AHCA alters Obamacare’s guidelines to help lower and moderate income people 40 percent less in subsidized assistance than what they are paying now. To qualify for subsidized help, that also would change from those making up to 138 percent of the federal poverty level to a new standard cut off of 100 percent.

To help individual insurance buyers, AHCA would have offered tax credits, something that the more conservative members of the House’s Freedom Caucus opposed.  The tax credit would have been based on the following schedule: under age 30: $2,000; between 30 and 39: $2,500; between 40 and 49: $3,000; between 50 and 59: $3,500; over age 60: $4,000. No household would get more than $14,000 worth of credits and the credits taper off for single filers making over $75,000 and joint filers making over $150,000.

The two main features that AHCA would retain from Obamacare include: children could stay on their parents’ health care insurance until they turn 26; and insurance companies cannot deny coverage for a pre-existing health problem.

Another big change in AHCA is that it would have ended the insurance mandate removing tax penalties to those who do not have insurance.

Critics say the problem of getting rid of the mandate to buy insurance while at the same time keeping the provision that insurance companies cannot deny pre-existing health problems leads to healthy customers dropping their plans, undermining the principle of risk-sharing that has helped to keep the cost of healthcare from rising dramatically since Obamacare’s inception.

As more people drop their insurance coverage, doctors worry that emergency rooms will begin to be used as a primary care clinic once again. This not only impedes effective health care delivery in emergency rooms, it also costs taxpayers more money because the government must pay hospitals for these patients who come into the ER but cannot afford to pay.

What Next? What about Obamacare…

After his first-round defeat in Congress, President Trump said he is going to wait “to let Obamacare explode” and wait for Democrats to come to him to collaborate on a new version of AHCA. “The beauty,” Trump says of waiting for an explosion, “is that Democrats own Obamacare.” But it’s doubtful that voters will be too forgiving of this viewpoint given that the Republican party controls both Congress and the presidency, and should be proactive in improving Obamacare. No timeline has been announced as to when AHCA will be taken up again, but the president vowed that replacing and repealing Obamacare was still on the table.

That window of opportunity is short because the midterm elections is one year away and the current GOP majority in Congress could be overturned, making whatever Trump proposes, including reforms to healthcare, that much steeper of an uphill battle.

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