The Dark Strategy at the Core of the GOP Health Care Plan

How the House Republican plan to overhaul Obamacare went from repeal-and-replace to cap-and-strangle

The driving principle of Tryancare is to dangerously erode federal support for health insurance over time – both for individual policies bought in the marketplace and for Medicaid recipients.

.. It trades in Obamacare’s guaranteed payouts for a new program of federal spending that looks vaguely adequate in year one. But Tryancare then caps future payouts – at a growth rate far below health care inflation.

.. Tryancare would mail out a monthly refundable tax credit – essentially, a check from Uncle Sam – for Americans to buy their own health plans.

.. Because these are flat tax credits, Tryancare shifts money out of the pockets of the poor and gives it to the upper middle class. A 60-year-old with an income of $20,000 would lose more than half the premium support now paid for by Obamacare (average: $9,874), while a 60-year-old making $75,000, who today does not qualify for subsidies under Obamacare, would get $4,000 under Tryancare.

.. Obamacare provided funds to expand Medicaid from a program generally limited to women and children in poverty to create, instead, universal coverage for the poor and working poor.

.. states would have to pony up an additional $253 billion over the next decade to preserve the benefits of Obamacare’s Medicaid expansion.

.. the Tryancare contribution is capped. It grows only at the rate of the increase in the Consumer Price Index (a measure of inflation) plus one percent.

.. Subsidies climbed from an average of $291 a month in 2016 to $367 in 2017, a boost of $76 a month.

.. Four GOP senators, led by Rob Portman of Ohio, have warned that Tryancare’s changes to Medicaid risk making it a non-starter.

CBO Sees 24 Million More Uninsured, $337 Billion Deficit Cut in Coming Decade With GOP Health Plan

Drop in number of insured would result in part because people would opt to go without coverage

 The report, by the CBO and the Joint Committee on Taxation, said the number of insured would drop in part because of people opting to go without coverage once the requirement that most Americans have coverage or pay a penalty is repealed. Higher premiums would also prompt some people to opt to go without insurance.

.. Premiums in the individual market would tend to increase before 2020, rising up to 20% higher than under the ACA, in large part because of the demise of the penalty for not having coverage, based on the report. Premiums would then go down: In 2026, the average premiums for a single person in the individual market would be about 10% lower than under the health law now, the analysis found.

.. Republicans have been pitching their overhaul of the health law as a cure for high prices under the ACA, asserting that the proposal would drive down costs by encouraging competition and giving people more choice. To achieve that, GOP members aim to relax the requirement that insurers provide a certain array of benefits, allowing them to offer less generous plans that cost less, among other changes.
.. The ranks of the uninsured would rise by 24 million in a decade in part due to a decline in the number of people on Medicaid, according to the CBO analysis. In 2026, an estimated 52 million people would be uninsured compared with 28 million who would lack insurance under the current ACA.

Analysis: GOP plan to cost Obamacare enrollees $1,542 more a year

We estimate that the bill would increase costs for the average enrollee by $1,542, for the year, if the bill were in effect today. In 2020, the bill would increase costs for the average enrollee by $2,409.

.. In general, the impact of the Republican bill would be particularly severe for older individuals, ages 55 to 64. Their costs would increase by $5,269 if the bill went into effect today and by $6,971 in 2020. Individuals with income below 250 percent of the federal poverty line would see their costs increase by $2,945 today and by $4,061 in 2020.

.. Currently, the ACA prohibits insurers from charging older individuals premiums that are more than three times greater than premiums for younger individuals. Under the Republican bill, insurers could charge premiums for older individuals that are as much as five times greater. Therefore, obviously, premiums for older individuals would go up, those for younger individuals would go down.

.. In the absence of the individual mandate, CBO estimates that adverse selection would increase premiums by 20 percent. We assume that the Republican bill’s replacement for the individual mandate would have at least some effect, but that it would not be as effective as the mandate. We assumed the shift to a continuous coverage model would increase premiums by 10 percent.

.. These cost increases would explode by 2020. We estimate that the Republican bill would increase costs for families by $4,274. For families with a head of household age 55 to 64, the bill would increase costs by $10,591. For families with income below 250% percent of poverty, the bill would increase costs by $9,024.