epublican-led health reform, declared dead at least twice this year, has arisen once again and could very well pass after July 4. Long cloaked in secrecy, the Senate’s Better Care Reconciliation Act was made public last Thursday. The act offers someone like me, a longtime health insurance observer and analyst and a former health insurance counselor, plenty to talk about. I’ll focus here on a sampling of policies in the draft act and how they could change access to care for the millions of people who need to buy their own health insurance from a state or federal exchange.
Each of these provisions, if passed alone, would likely result in more people uninsured and in need of care. Taken as a whole, the Senate bill is expected to increase the number of uninsured people by 22 million in 2026 — including 7 million more uninsured people on an individual exchange by 2018. The changes would reintroduce challenges faced by individuals before the passage of the Affordable Care Act, struggles I observed while providing health insurance counseling and support.
Declining subsidies for health insurance
When measured against standards of affordable coverage, the ACA, which became law 2010 has its flaws (even with the ACA subsidies, insurance is still expensive) especially for low-income individuals enrolled in state and federal health insurance exchanges. I’ve written about this affordability gap for several years.
One way to analyze affordability under the ACA is to look at states that tried to move people off the Medicaid program and onto its subsidized exchanges. That reflects whether people can afford coverage. Where we could find data on this — Connecticut, Rhode Island, and Wisconsin — it appeared that low-income people who were previously on Medicaid weren’t signing up for exchanges, and affordability was a factor for them.
The Senate bill does expand subsidies below the poverty line, which provides help for people in states that did not expand Medicaid to a greater number of low-income individuals. Other than that population, however, the bill would make the ACA’s affordability issue worse through a number of different provisions. First, it would reduce overall subsidies for health insurance premiums by calculating them based on an assumption that health insurance would cover about 58 percent of health care costs, instead of the ACA’s 70 percent. Second, the Senate bill would repeal cost-sharing subsidies after 2019, meaning that low-income people would no longer get help with copays and deductibles. Third, it would change a key aspect of the ACA by letting insurers charge older adults higher premiums and at the same time reduce subsidies as a person ages. The bottom line? Health insurance would cost substantially more.
Limiting the availability of plans
As a health insurance navigator at CHOICE Regional Health Network in Washington state in 2005 (well before the ACA was even a twinkle in lawmakers’ eyes), I helped people explore their insurance options at a free clinic located in a church that offered care once a week. A family came into my cubicle, the parents and kids all looking defeated. A few months earlier, the family had moved from the Midwest for the father’s new job in Washington state. The job offered health insurance, but there was a 30-day waiting period before it kicked in. Since it was such a hassle to get individual coverage, the man didn’t apply for insurance to bridge the gap. He had a heart attack during that waiting period. Afterward, he faced not only a new health problem but $75,000 in debts.
Back then, in order to get coverage on the individual market, Washington state residents had to visit the insurance commissioner’s website, find a grainy document listing insurers, call each toll-free number, give each insurance representative all of their medical information, and wait for a quote. Because information about covered benefits was hard to find or understand, it was virtually impossible to compare plans.
The ACA is not perfect. But it does make it easier and more affordable to buy insurance on the individual market, and it likely would have made insurance a viable option for this family. Though the ACA made individual markets more accessible and affordable, there are parts of this country hurtling toward non-functional individual markets. This is due in part to weaknesses inherent in the ACA, but more so due to the incomplete implementation of the ACA, such as the partial implementation of reinsurance, cost-sharing reduction payments, and Medicaid expansion.
The Senate bill will not make individual markets healthier — in fact, it makes them more prone to so-called death spirals. By making both premiums and cost-sharing less affordable, the Senate bill makes plans on the individual market less attractive to healthy people and the system more vulnerable as a whole.
Opting out of essential health benefits
As a lawyer assisting HIV patients at Whitman-Walker Health Center in the District of Columbia in 2010, I saw firsthand the challenges of finding health plans that offered medications to keep people healthy. It could take an hour sifting through the available information with a trained individual to find the right plan that worked to manage a patient’s HIV. Over the past few years, it appears that some insurers have been in competition with each other to see how few HIV medications they can cover, in order to discourage people with HIV from signing up. Skimping on benefits in order to keep sick people away has been going on for some time in the larger health care marketplace.
The ACA’s essential health benefit requirement for health insurance exchanges helps prevent that scenario by requiring all insurers to cover a basic set of benefits and gives patients a tool to get the care they need. The Senate bill would let states waive these essential health benefit requirements on the exchange without showing that their replacement plan would offer just as affordable comprehensive coverage to just as many people. What this means is states can scale back coverage, leading to further disparity in health care access across the nation.
The Senate bill — which contains some of the same provisions as the version approved by the House last month — if passed in its current form would rescind key aspects of the ACA that aimed to make the individual market more equitable and affordable. In doing so, the new bill would cause approximately 22 million people to lose their health insurance and access to care.
Rachel Gershon, J.D., is an associate at the University of Massachusetts Medical School’s Center for Health Law and Economics who performs legal and policy analysis with a focus on Medicaid, health care reform, waivers, and long-term services and supports. The views expressed here are those of the author and do not necessarily reflect those of UMass Medical School.