The American Health Care Act: Politicized, Ineffective, and Dangerous

Since the introduction of the Affordable Care Act (ACA) in January 2010, Republicans have consistently decried the failures of the ACA and promised to provide a better alternative. On May 4th, it became clear that not only did Congressional Republicans not have a better healthcare plan, but that they are willing to push through a widely unpopular repeal and replace bill that may endanger millions of Americans if passed by the Senate. Last week, House Republicans narrowly passed a haphazardly assembled bill entitled the American Health Care Act (AHCA). Despite Republicans having a majority by 24 representatives, the measure passed the House of Representatives by a mere four votes, with 20 Republicans defying party leadership to vote no. An earlier version of the bill failed to reach the House floor, with parts of the AHCA lacking appeal for both moderate House Republicans and hard-core libertarians. As a result, Republicans added a number of new measures to try to gain political support. The bill has now been passed on to the Senate, where Republican senators will likely make major changes to the measure to attempt to accumulate sufficient support.

The May 4th bill was passed before it could be scored by the non-partisan Congressional Budget Office (CBO), indicating a lack of knowledge of the basic impact of the bill after an array of politically motivated amendments were added to garner sufficient votes. However, the CBO assessment of the original failed bill in March and private analyses of the new bill provide insight into the potential budgetary and societal consequences of the AHCA. According to that assessment, the AHCA’s goal to restructure and slash the Medicaid program will reduce federal spending over time, but will also likely reduce the number of covered individuals by 14 million by 2026. The bill also allows insurers to raise rates for older people, penalizes people who go more than two months without continuous coverage if they try to reapply, and slashes the ACA’s cost and income-based subsidies. The AHCA also disposes with the employer mandate which required employers larger than a certain size to provide coverage to employees, as well as eliminating the ACA’s individual mandate that charged a tax penalty to individuals who did not have health insurance. These major changes, combined with the lack of price limits on charging patients with pre-existing conditions, will likely lead far fewer healthy individuals to purchase health insurance, while forcing those who need coverage most – primarily elderly people and individuals with pre-existing conditions – to pay thousands more in insurance premiums. Despite politically effective amendments to the most recent version that offer some funding to offset the rise in premiums, these efforts will likely be insufficient to provide significant financial relief for the people most affected. The basic framework of the law hasn’t changed much from the original version, and the initial CBO projection of 24 million Americans losing coverage and federal savings of around $300 billion is likely still relatively accurate.

Instead of creating a legitimate solution to the problems that were apparent with the Affordable Care Act, Congressional Republicans have designed an ineffective bill that sacrifices coverage and costs for limited budgetary relief. The AHCA fails to garner the coverage benefits that would come from either a system closer to a single-payer model or the reduction in costs that would result from a legitimate market-based system. Internationally, developed countries have had significantly more success implementing single-payer models of healthcare. Even though the costs associated with single-payer healthcare are often considered prohibitive by American policymakers, the United States currently falls far below the average when comparing life expectancy and health care spending. The United States spends far too much money on healthcare without seeing sufficient benefit, largely due to an irrational and politicized approach to the issue that has led to a system stuck between single-payer and market-based, without reaping the benefits of either.

Any move towards a single-payer model is not going to happen with a Republican-majority Congress, but there are also legitimate alternatives that comport with conservative free market ideals. If Republicans were serious about responsibly moving towards a fiscally conservative interpretation of healthcare, they could advance wide-scale regulatory reform of the way health insurance is purchased from suppliers, while subsidizing coverage effectively. This approach would also require a privatization and reconstruction of Medicaid through an intelligent long-term plan, and simultaneously addressing egregiously high drug prices and general access to care. Though it would be difficult, this could be done without depriving millions of Americans from access to health insurance and without substantially increasing premiums for the most vulnerable. Instead, Congressional Republicans have showed that they lack both foresight and regard for the welfare of Americans. If the bill, which had a public approval rating of only 17% in March, manages to pass the Senate in some form and results in the loss of coverage and the price spikes that seem likely, Congressional Republicans will endanger the most vulnerable elements of the American public, and may also drastically damage the Republican bid to maintain control of Congress.