Older Americans at risk as Congress takes ax to Obamacare

Anyone nearing retirement – or already retired – should pay very close attention to the doings of the 115th Congress that was sworn in this week.

Repeal of President Barack Obama’s Affordable Care Act (ACA) tops the agenda for Republicans, who will control the White House as well as both houses of Congress when Donald Trump takes office on Jan. 20. That will place a heavy financial toll on millions of older Americans who do not have access to employer-sponsored insurance or Medicaid, and who are too young to enroll in Medicare. But repeal of the ACA will also raise the cost of Medicare for current and future enrollees.

The details surrounding the repeal of what became known as Obamacare – and how it will be replaced, if at all – are unknown. But it is clear that Republicans, rather than fix the existing system’s problems, intend to gut the most important social insurance legislation since the passage of Medicare and Medicaid in 1965.

In my Reuters Money column this week, I take a look at how full repeal of the ACA would impact older Americans.

Let’s start with older people still too young to enroll in Medicare. Here, ACA repeal will mean higher premiums and out-of-pocket costs. Most Republican proposals that have been circulated loosen or eliminate restrictions on higher policy prices for older buyers. The program’s income-related tax subsidies, which aim to make premiums affordable for middle- and lower-income households, likely would be replaced by a flat tax credit that shifts costs to enrollees. Some repeal-and-replace plans also weaken the current ban on covering people with pre-existing conditions.

Repeal of the ACA would also have a direct impact on Medicare spending and costs to beneficiaries.

Full repeal would increase Medicare spending by $802 billion from 2016 through 2025, according to the Congressional Budget Office (CBO), primarily by restoring higher payments to health providers and Medicare Advantage plans. That would lead to higher Part A (hospitalization) deductibles and copayments, and higher premiums and deductibles in Part B (outpatient services).

A detailed brief on how ACA repeal would impact Medicare can be found at the Kaiser Family Foundation website.

Perhaps most galling is the insistence by ACA opponents that the law if failing. ““The fact is the wheels have been coming off of Obamacare for a long time now,” Senator John Cornyn of Texas said this week, adding that he understood that the Democratic senators, “as a political matter,” feel that they need to defend the health care law.

We may be living in a post-fact, post-truth environment, but here is an interesting fact, nonetheless: a strong majority of people covered under Obamacare are quite satisfied with the coverage they are receiving. Last year, 77 percent of adults in marketplace plans, and 88 percent of those who received Medicaid coverage under the ACA expansion, were either very or somewhat satisfied with their coverage, according to polling by the Commonwealth Fund, a foundation focused on healthcare research:

 

Comments

  1. The current plan is working so well-NOT
    Once again a view from the left pronounces the success of Obamacare.
    Who do you think pays the government so it can subsidize health care?

  2. Mark Miller says:

    Dan, we may be living in a post-truth world, but square this circle: Obamacare is failing, but upwards of 80% of those covered are satisfied with what they have (see above). Do we agree that access to health care is a right – not a privilege? If so, I wait eagerly to hear about the better approach from conservatives. Six years after passage of the ACA, no alternative has surfaced that replaces the ACA, at least not in terms of the level of protections and pricing in the current law. I know of only two ways to expand coverage to near-universal levels. ACA is one way – it actually is a neo-liberal model initially cooked up by the Heritage Foundation. The other – preferred by progressives like me – is single payer. That’s not going to happen in this climate, obviously.

    Who do I think pays the government so it can subsidize health care? The same people who pay the government to “subsidize” highways, bridges the military, farmers, etc etc etc. In other words, we both do that. Certain things we decide to do together as a nation. Or not.

  3. William Barron says:

    I don’t know who your polling because everyone I talk to complains of excessive premium cost and incredibly high deductibles with no co-pay. We hear from a lot of polls that find people “satisfied” with their coverage but I’ve not heard a single person stand up and say “I like my insurance plan, this is a really good thing”. I’ve not read one story in any of your publications that feature a family singing the praises of Obamacare.

  4. Mark Miller says:

    William, quoting from the report: “The fourth Commonwealth Fund Affordable Care Act (ACA) Tracking Survey interviewed a nationally representative sample of 4,802 working-age adults, of whom 881 have new marketplace or Medicaid coverage
    under the health reform law, to find out how their insurance is affecting their lives (Table 1). The survey firm SSRS conducted the interviews between February 2 and April 5, 2016.” Here’s another similar poll: http://kff.org/health-reform/poll-finding/survey-of-non-group-health-insurance-enrollees-wave-3/

    Here’s an article on individual attitudes. http://www.npr.org/sections/health-shots/2016/11/26/502464718/worries-about-health-insurance-cross-political-boundaries

    Not saying there aren’t problems with the law. Let’s fix them, not throw the whole thing away.

  5. These congressmen and women that vote against universal coverage sicken me in that it’s so easy to get up in front of their colleagues and declare the ACA a total failure (in spite of the contrary evidence). If they and their failies were forced to live with the same insurance coverage afforded by the ACA I’m quite sure they would either fix it or live with it until a fix could be made. Trumps warning that the failure to provide a viable alternative to the ACA will cost the republicans politically should be heeded.

  6. Attention needs to be paid to details of the polls. First, the level of satisfaction with the ACA plans available to participants has been steadily declining for the past three years. Second, these surveys were taken before the current premium year with significant increases in many states. Third, there is little or no demographic information presented to indicate level of income vs satisfaction level. People on Medicaid pay little or nothing for their health care and will not be concerned with premiums or deductibles. Most people in the polls do not consider their health plans to be a good value. The ACA is failing because it is largely not affordable and has little to guarantee quality care. Many hospitals pick and choose what plans they’ll participate in and the physicians practicing in the hospital may not participate in the same panel. This means the patient may be covered for one and not the other. Until we get to true universal health care for all and eliminate profit motives of private insurance companies, we will not be able to achieve truly affordable quality care. This also implies “rationing” of health care, meaning people can not abuse the system and show up in emergency rooms for colds, take an ambulance to a hospital because they don’t want to pay for a cab, undocumented aliens who go to ERs for expensive care that they won’t be paying for, etc. We can’t control the rising expense of health care by controlling costs without also controlling demand. Also, duplication of service in the name of competition needs to be reduced. Not every radiologist needs to have an MRI machine. Expensive equipment needs to be centralized. Perhaps this sounds socialistic, but if medical care is run as a for-profit business (as it is now), it will never be universal or affordable for all.

  7. I know a lot of people who hate the ACA but of those not a single one who is actually on it or even knows someone who is. They just hate Obama and Government. They forget that ACA came into being because the private health insurance system was failing the public, leaving millions uninsured and allowing insurers to cherry pick clients. Congress, which is a trailing institution not a leading one, stepped in to right a wrong. Now revisionist critics argue there never was a wrong to right. That seems the equivalent of climate change denial. Most new legislation requires time to tweak and the ACA is no exception. But that can be done. We should do it, not abandon it.

  8. Few things. Of course Medicaid recipients who didn’t get the free ride before and do now because of the expansion, are going to be “satisfied”. I am an ACA certified agent and also a happily married self employed man with 2 kids. I talk to hard working families every day that are now paying 3X the amount now compared to 3 to 4 years ago for the same basic benefits (me included). Or, to keep the same premium, they have to choose a catastrophic plan that has around a 6550/person/year up to 2 in a household deductible. Meaning that the first 6550 for anything healthcare and prescriptions will be out of pocket before the insurance company pays anything. ZERO. This leads to people not seeing doctors for fear of cost. The only way that any plan is “affordable” is if you qualify for a large subsidy because of low income. Of course, once again, these people getting a better benefit plan because the subsidy is paying the majority of the premium will be “satisfied”. I do agree that there are portions of the ACA that have helped certain sectors of people. I am in hopes that some of these ideas will cross over in to whatever is next. In closing, I have spoke to hundreds of people and only a few are in a better situation because of the ACA. Let’s all just wait and see. Until things are in writing, nobody knows. When they do put a new plan out there, then we can use our common sense, education, and facts to know what we are talking about! Have a Happy New Year.

  9. Mark Miller says:

    Todd – thanks for writing. Question: how do you read the 77% approval rating for marketplace participants (non-Medicaid). Do I assume that, since you are an ACA-certified agent, you are not dealing with marketplace buyers who have subsidies?

  10. Good points made by those on both sidse of the ACA issue. But no matter what form of health insurance or coverage Americans end up with, the driving force behind all health care issues is the cost for services and providers. I don’t believe the issue has truly been addressed.

  11. Jeff Williams says:

    Mark, thank you for continually offering well reasoned analysis and thought about financial issues affecting older Americans. We should have a national sense of shame that the U.S. is one of the only, if not the only, developed country where people (and a lot of them) are going bankrupt solely because they can’t pay medical bills. This predicament has been known for decades and yet Republicans have never proposed any practical health care reform to widen medical insurance coverage, as has ACA. The Republicans have been perfectly happy to let health insurance companies disallow individuals with pre-existing health conditions from gaining coverage. YES ACA needs tweaking – the Obama administration always admitted this – but something very dramatic was called for to stop insane policies by health insurance providers, such as redlining on policy issuing. Apparently there is no Republican voter with a pre-existing health condition who has been denied insurance coverage; not one who lost coverage after being downsized during the Great Recession and has had trouble finding a replacement; or not one with a child who has a catastrophic health condition but the family has no health insurance coverage! In my view pulling more and more Americans back from the edge of the abyss of personal bankruptcy is much more important than the cost of doing it.

  12. Mark Miller says:

    Thanks, Jeff. I think a big problem, politically, is that many in the electorate really don’t understand the fundaments of how insurance works. Note this article in the NYT by Drew Altman, who heads the Kaiser Family Foundation, about focus groups his organization conducted recently with Trump voters: “They were unmoved by the principle of risk-sharing, and trusted that Mr. Trump would find a way to protect people with pre-existing medical conditions without a mandate, which most viewed as “un-American.” (http://www.nytimes.com/2017/01/05/opinion/the-health-care-plan-trump-voters-really-want.html) This is the essence of how all insurance markets work, commercial or social.

  13. Congress should have the SAME plan as the people have, no difference; THEN we will a rational satisfactory plan. Call your Congressman & insist on this!

  14. Lisa Adatto says:

    Thank you Mark, for providing facts and reason about this important issue.

  15. Susanne Krivit says:

    I agree with the basic premise mentioned in some comments, that some significant portion of voters do not agree that they want to support the healthcare of less wealthy or sick people. That is one major problem. The other is that the ACA did not decrease the actual cost of healthcare. It is unfortunate in my opinion that we will likely be moving backwards, when we should be building on the ACA, but I think that is what will happen. It is also unfortunate that so much miss-information is out there about the success of the ACA. For those that do qualify for the reduced costs, it really is a great step forward.

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