Nothing could be more telling about the American Health Care Act of 2017, the Republican replacement for the hated Patient Protection and Affordable Care Act, than the White House’s insistence this week that it NOT be called Trumpcare.
It was the clever Republican strategy of calling the Affordable Care Act “Obamacare” that poisoned the debate in 2010, when Congress passed the big insurance reform without a single Republican vote. Obama was immensely unpopular across the South and the rural Midwest, and the new law had to carry all the president’s baggage along with the terms socialized medicine, government control of health care, death panels, ending Medicare and all the rest of the labels created by Republican strategist Frank Luntz, the U.S. Chamber of Commerce and Americans for Prosperity.
When the president said he was happy with the epithet “Obamacare,” that is what it became. Objective news media even adopted the name.
To his credit, President Trump clearly had not even the slightest role in designing the unbelievably complicated Republican plan, because he never had the slightest understanding of Obamacare and the complexities of the health insurance market. He admitted two weeks ago that he was shocked by how confusing it all was. But while the big Republican plan achieves none of the things Trump promised, except to nominally “repeal” Obamacare, he praised it, called it his own and demanded that Congress pass it forthwith exactly as House leaders wrote it. He called it “beautiful”; everybody will have health insurance and love it! Just don’t call it Trumpcare.
Conservative Republicans immediately called it Obamacare Lite and Obamacare 2.0. Rather than destroy the Affordable Care Act, the Republican plan embraces its major strategies but changes the details in ways that achieve one goal—removing the cost burdens on the rich and to some extent the young and piling them on the poor and the aging, those from 45 to 64. For those over the age of 64, Medicare will lose major funding and face a bleak future that will almost certainly mean rising costs for the elderly and disabled who depend upon it.
That is essential Trumpcare. Despite Trump’s protestations, that is what it will be, for it is he alone who makes it possible, if indeed the plan makes it through Congress to his desk. Arkansas’ Sen. Tom Cotton, a big Trump fan and lately an adviser, having heard from angry Arkansas constituents who stand to lose their medical coverage, announced midweek that the plan was a mess and could not be passed in the Senate. Cotton didn’t need a study by the Congressional Budget Office to know that tens of thousands, perhaps hundreds of thousands, of Arkansans will lose their medical coverage or else spend so much more for premiums and deductibles that it will change their lives for the worse.
Instant analyses by think tanks like the Brookings Institution and Kaiser Foundation and interest groups like the American Hospital Association, the American Medical Association, nurses groups and AARP said the Republican plan would cause millions to lose their insurance or else accept essentially worthless insurance. One study said up to 16 million of the 20 million people insured under Obamacare could lose coverage. It depends on how much the market collapses from the devastating changes.
Can we do a short primer? Both Obamacare and Trumpcare are immensely complicated in their details but follow simple outlines. Both try to expand coverage to citizens through the free market (the insurance industry) instead of mandatory government insurance like Social Security, disability insurance and Medicare. The government requires insurance to cover certain medical procedures and treatments. Obamacare added that companies could no longer refuse to insure people because of an existing condition or cut them off when their medical costs rose and that youngsters could stay on their parents’ plans until they are 26. Trumpcare keeps those popular features.
Obamacare and Trumpcare seek to help people buy private insurance through fundable tax credits, but Obamacare provides greater tax credits the poorer you are, or otherwise no low-wage family could afford a plan. People with higher incomes will fare better with Trumpcare.
A big, big difference: Trumpcare favors young healthy people, those in their 20s and 30s, who will see their premiums go down. Companies will be able to charge older people, who are within a decade of reaching Medicare, five times as much as they charge young people. A 64-year-old woman earning $16,000 a year might get a policy for $8,400 a year if she could get one at all.
Here’s an irony. Young people voted against Trump by huge margins. He won big among older people. When all these changes take place—after the next election—Donald Trump doesn’t want people thinking Trumpcare.
The biggest change is this: Trumpcare repeals taxes on the rich and industries that pay for Medicare, Medicaid and the tax credits: the additional Medicare tax on family incomes above $250,000, the 3.8 percent Medicare tax on net investment incomes that falls on the richest 1 percent of Americans, a 10 percent excise tax on the cancer-producing indoor-tanning industry, and small taxes on the pharmaceutical and medical equipment industries.
Those taxes were the drivers of the seven-year repeal-Obamacare campaign. Trump and Congress had to get rid of them if nothing else. But those taxes have paid for Obamacare even while shrinking the national deficit, which will begin to soar again once the taxes cease.
Then there’s Medicaid expansion, the third leg of Obamacare, which has been such a bonanza for Arkansas, providing medical care for more than 300,000 of Arkansas’ poorest, swelling the state treasury, paying for tax cuts for most Arkansans, creating thousands of jobs and solidifying Arkansas’ crashing community hospitals. Trumpcare does away with it in 2020 (two elections hence), at least the features that brought so many advantages to Arkansas. In 2020, the federal government will no longer pay for rising costs of caring for the aged in nursing homes, the disabled, children or poor working adults. The state government will have to do it, or else turn them out of the beds.
But if the current legislative session is any guide, the Arkansas legislature and the governor won’t view that as a problem. Gov. Hutchinson last week expressed his great pleasure that some 25,000 poor people had lost coverage under his Medicaid changes and that he hoped to make changes, with Trump’s approval, that will leave tens of thousands more to their own devices.
