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Understanding the complex issue of healthcare reform

Last week, Republicans unfurled a healthcare bill that would undo former President Obama’s signature healthcare law and replace it with a more modest system of tax credits.

The new bill, dubbed the American Health Care Act, received approval by two key House committees on March 9. But it has also drawn the ire of Democrats, who say it goes too far in cutting programs and will leave millions without healthcare, as well as conservative Republicans, who argue the proposed legislation doesn’t go far enough.

On Monday, the independent Congressional Budget Office released its assessment of the bill, which predicts the number of people without health insurance will increase by 24 million by 2026 while the federal deficit will decrease $337 billion over that same time.

Healthcare legislation is a complex, divisive issue, and one that will likely dominate headlines and lawmakers’ debates for months to come. To help understand it all, we asked several faculty members across disciplines to break it down. Here, three experts in the fields of law, philosophy, and political science examine the major differences between “Obamacare” and the Republican leaders’ proposed healthcare bill; how the new legislation stands up to moral imperatives; and the inside politics driving the debate.

Here is the first in our two-part series examining the American Health Care Act.

What are some of the biggest differences between the proposed American Health Care Act and the Affordable Care Act?

Wendy Parmet, Matthews Distinguished University Professor of Law and co-author of the book “The Health of Newcomers: Immigration, Health Policy, and the Case for Global Solidarity”

The first thing is, it’s highly regressive, whereas the ACA was really designed to make health insurance more accessible by making it more affordable for low- and moderate-income people. The ACA did that by increasing taxes on the very well-off, whereas this bill does the opposite: it gets rid of those taxes and puts in place a subsidy system that will be of far less utility to those on the lower end of the income scale. It makes Medicaid less of a guarantee for lower-income people. So in terms of income distribution, this is regressive legislation versus progressive legislation.

Secondly, the bill itself is a strangely inconsistent hodgepodge of measures. It lacks the policy coherence that you would expect from complex and sophisticated healthcare legislation. My view is it’s a hodgepodge because it was borne out of political promises, which can make for a policy mess unless it’s done carefully and painstakingly.

“In terms of income distribution, this is regressive legislation versus progressive legislation.”

Wendy Parmet Matthews Distinguished University Professor of Law

Wherever you stand on the issue of healthcare, you’ll want to see something coherent within itself. But from a policy perspective, if you’re teaching a healthcare policy course, this doesn’t make a lot of sense.

Finally, the Medicaid change is a really big deal. The Congressional Budget Office estimates that by 2026, federal Medicaid spending would be 25 percent lower under the House bill than is projected under current law. Meanwhile, the number of Medicaid beneficiaries would be 17 percent lower, with 14 million fewer people covered by the service.

This is not just an “Obamacare” repeal. This is a Great Society repeal. This is changing the nature of Medicaid in a fundamental way and getting rid of entitlements in a fundamental way.

What are some of the benefits of the proposed bill, as compared to the ACA?

Timothy Hoff, professor of management, healthcare systems, and health policy

The Republican House bill to replace “Obamacare,” as the CBO notes in scoring it, could reduce the deficit by several hundred billion dollars over the next 10 years. Deficit reductions are good in the abstract. The CBO also estimates that over time, average insurance premiums might lower in comparison to what they might be under “Obamacare,” after initially being higher for several years.

However, the deficit reduction comes at the expense of approximately 24 million more Americans who will lose their insurance, and the premium reduction would affect population segments disproportionately, with older adults potentially seeing very large premium increases in any private coverage they get through the non-group insurance market. So there is some real hurt in this particular bill.

If you believe all Americans deserve health insurance coverage, there is little in this bill to really like, since it sets the stage for taking dollars out of Medicaid and health insurance subsidies for the poor, and using those dollars for other things like tax cuts for wealthier Americans.

“The Obama plan was the most conservative ever proposed. It passed in a party-line vote. It had a messy rollout that gave the Republicans ample ammunition for attack. The opposition has been based on ideology.”

William Crotty Emeritus professor of political science

Unless fundamentally altered by the Senate or under pressure from the president, this bill, if passed, would create as much uncertainty in the health insurance exchanges as exists now and gut state Medicaid programs over time.

In truth, it feels more like a “reducing the size of the federal government” bill rather than an alternative health insurance coverage bill. It likely will turn the clock back to the time, only a few years ago, when over 50 million Americans were uninsured and had few viable options to gain affordable coverage in the individual market. It’s just bad policy if you view good policy as intending to help Americans in need get a fair chance to have the kind of healthcare coverage that puts them and their families on a good footing for success in life.

What politics are at play in pushing this healthcare package through Congress?

William Crotty, emeritus professor of political science

The politics of healthcare are simple enough. Republicans have waged an all-out, no-holds-barred fight against the Affordable Care Act since its adoption. Talks of “death panels” set the tone. It has paid off for the Republicans brilliantly. “Obamacare” is a complicated law, beyond virtually anyone’s understanding.

The Obama plan was the most conservative ever proposed. It passed in a party-line vote. It had a messy rollout that gave the Republicans ample ammunition for attack. The opposition has been based on ideology. This is where the problem lies. Running against “Obamacare,” the Tea Party was born and took control of the House of Representatives in the 2010 election. The Republicans gained a majority in the Senate in 2014. They still hold these majorities and whatever is adopted or rejected will have to be decided by the Republicans.

Trump ran hard against “Obamacare” and promised that his first act in office would be its repeal. He had no plan to offer and does not understand the issue. The House, led by Speaker Paul Ryan, has come up with a proposal. Trump has fully endorsed it and promised a “bloodbath” if it is blocked. Meanwhile, the Tea Party, anti-government legislators, oppose it as not conservative enough. Some Republican governors and a few senators are urging caution and a more restrained approach given the potential consequences. As of now, none have fully opposed the House bill. Two House committees within a matter of days reported the bill out favorably, in an effort to get it to the floor before the opposition coalesces and before the Government Accountability Office has had a chance to assess its cost and operation. This is most unusual, as several Republicans have pointed out.

 

Photo via Flickr user Gage Skidmore.