Facing the Republican Attack on the Affordable Care Act, What Way Forward?

Mar 20, 2017

The following is a text of a presentation given at a SPARK Public Meeting in Detroit, slightly updated to take account of recent fuller information.

Trump came into the White House boasting and swaggering about his intention to get rid of what Republicans derisively call Obamacare. He said, “I’m blowing it up ...it is imploding ...exploding ...history ...gone ...finished!”

And that is exactly what Republicans set out to do, when they announced legislation to scuttle many parts of the Affordable Care Act.

But the reform of a huge system like the health care system is complicated—as Trump soon admitted, whining that he hadn’t realized how complicated! Hadn’t realized! What everyone who ever tried to get medical care in this country knew, Trump hadn’t realized!

The real problem for the Republicans is that health care deeply touches the population in a way that can get politicians put out of office. And that is exactly the reality now staring Republicans in the face.

One Republican, who came under fire in his own state, said, “Reforming Obamacare is like receiving a 300,000 piece puzzle for Christmas.”

In any case, the Republicans now have their own puzzle. Much of the detail of course has been blurred in their telling about it. But, just like the whole medical care system, the Republican plan is a grab bag of things Republicans have been proposing since the ACA laws were passed, one on top of the other. It is not clear how they would connect the pieces and on what timetable. What IS clear is their determination to make an immediate attack on the health and welfare of the poor and unemployed, as a first step in a larger attack against the general population. Republicans are scrambling to obtain votes from their middle class and deeply reactionary base, which is averse to any social programs.

Moving to Junk Medicaid

Republicans intend to permanently cap government funding for all Medicaid coverage, including the extension that “Obamacare” put in place for 12 million additional low-income individuals and families. Over time, this cap—which will not keep pace with advancing medical costs—will effectively shut down the Medicaid program for new people in many states.

Republicans also intend to eliminate subsidies that offset the high costs of the current programs. Funding for advance premium assistance for very-low-income families will also be eliminated.

They propose to replace the subsidies with small across-the-board tax breaks, the same for everyone regardless of income and regardless of the cost of medical care. Even though the tax breaks for older people are slightly larger, given that insurance and medical care for older people is so much bigger, these tax breaks will effectively favor young, healthy individuals, at the expense of older people with medical problems.

Finally, they would eliminate the mandates of the program, which means gut the rules that make up the federal guidelines for both insurance companies and hospitals and all U.S. citizens. These rules require that everyone has insurance and, if they don’t, they pay a small fine to the government. Under the new plan, there is no fine to the government, but if people let their insurance lapse or don’t get it, when they do sign up they will have to pay the insurance companies a 30% higher premium—in other words, a fine paid to profit.

The Republican plan would also junk the requirement that insurance companies must provide at least a standard health care package, which should include basics like preventive care, hospitalization and drug coverage. Instead of imposing controls on prices—as Trump once promised—Republicans now propose to allow insurance companies to charge older people rates five times as high as younger ones, instead of the current limit of three to one.

And, as a gift to the big insurance companies, they would completely eliminate subsidies for at-risk insurers, leaving only the giant insurers in the field. Already, prior legislative action eliminated all but 13 percent of the funding originally designated for this purpose. This has already driven smaller insurers and co-ops out of business, resulting in rural areas being stuck with often only one choice for an insurer and much higher prices.

We cannot know how quickly and deeply the attacks on the affordable health care law could unfold—in part because it appears that the Republicans don’t even have enough votes from their own party to pass this new medical insurance plan, “Trumpcare.”

But we do know that the politics of the current administration are against any government support for health care to the working class and the poor. Their plan is to reverse the flow of money spent on low-income families and shift it to the upper classes.

Behind their attack on government programs, is the determination to shift funding for Medicare and Medicaid programs to the states, providing the states at the beginning with cash money in block grants, but ultimately leaving the states unable to pay what only the federal government has the means to pay.

The Republicans brag that the Congressional Budget Office finds that the new plan will reduce the government’s overall deficit by 337 billion dollars over ten years. Perhaps, although what they cut from medical programs is almost certainly going to end up in the pockets of the wealthy and the big corporations and banks. In addition, what is cut on the federal level will be sent to the states to fund—some may try to do it, but most will end up cutting programs.

Those who are afraid of deep changes to their health care protections are right to be. The political forces moving forward represent the most reactionary elements of the middle and upper classes: vicious enemies of the working class and poor. Donald Trump has gathered around him a vicious gang of right-wing conspirators—who are pleased with a program that would cut 24 million people off medical coverage by 2026.

Afraid? You Are Right to Be

But leaving the current systems in place is no solution, either.

Obama and Democrats allowed big private insurers to shape and control the new programs. In the Affordable Care marketplace, which covers some 12 million subscribers, the programs are not affordable for those above the income level that allows for Medicaid plans. Even worse, for this section of the population, the programs are so expensive that combined payments for deductibles, co-pays, coinsurance, out-of-pocket costs are so high that families and individuals can face trading off having decent housing for health care, but can’t afford both. Twenty-seven million people are still uninsured.

The system is so complicated, so bureaucratic, that the best of detectives can’t find their way to really be sure what the best policy is for them. The levels of coverage called bronze, silver, gold, and platinum are financially out of reach. Subscribers are still left to pay 20, 30, and 40 percent of costs themselves. The silver level, which is the most used, transfers 30 per cent of medical care cost to the subscriber! And that only AFTER you have paid out all year for premiums, deductibles and co-insurance.

Premium costs alone can top $10,000 per year for a family. Deductibles, which are money that has to be paid by you before insurance pays anything, are easily between $3,000 and $6,000. This year alone, in Michigan, costs have risen 20 percent.

The result? You have insurance, but don’t go for treatment unless you have a crash, like a heart problem or stroke. Families don’t have the money to pay the up-front costs.

The larger impacts of the Affordable Care Act are less talked about and less known. For one hundred fifty million workers who are in group plans at workplaces, the employers have transferred higher costs to employees, claiming they are preparing for the so-called “Cadillac taxes” on “generous” insurance plans. Employers are demanding that workers pay premiums, high deductibles, coinsurance and co-pays where they didn’t demand it before. Deductibles went from $150, $300 for a family to $3,000, $6,000 and more! Result? Workers stop going for medical treatment.

Leading the Way to the Bottom: The U.S. Medical Care System

While almost every other industrialized nation in the world has provided universal healthcare to its population, the U.S. government has traveled in the opposite direction. The socialized medical coverage that we call Medicare and Medicaid—the only somewhat efficient programs that have been in existence for more than 50 years—are also being pulled backward by the movement to eliminate government funding for medical coverage. While these programs still insure over half of the insured population, time is running out before these government programs are turned over to private insurers.

It’s obvious that large parts of the U.S. population are increasingly concerned about losing health care protections.

Does this mean that we should all fall into the Democratic camp and defend Obamacare to our dying breath? Hardly.

To settle for a fight to just preserve the existing Obamacare would be a mistake.

We have to recognize that good, fair national health care can’t be near realized while a for-profit system is left in place.

With no way for workers in this system to control how a program is organized, working people have no hope of good universal, accessible health care.

We have to set our vision higher than to simply protest an attack on an already broken system. We have to set our sights on the fight for national health care for all and make a fight that would threaten to bring the house down, a fight like those of the past when the rich backed away from the power of the organized workers and poor in struggle.

We can be sure that neither Republicans nor Democrats will lead such a fight. Obamacare was crafted in a period where the Democrats controlled the Presidency and both the House and Senate in Congress. They let big health care companies design a hugely profitable system for themselves instead of insisting that Medicare be extended to all: a national, universal, single payer system. The population would have backed them to the wall on that.

It doesn’t take any more energy to fight for new solutions than it does to fight for old, broken, half fixes. We may as well go for it all. After all, we are in a fight for our very lives when it comes to the health care disaster.