How Conservatives Smeared Obamacare And Laid The Groundwork For Trumpcare
Obamacare Reaches Seventh Anniversary As House Reschedules The Vote On The AHCA
NPR: GOP Hoped To Mark The ACA’s Anniversary By Passing AHCA. NPR reported that March 23 “mark[s] seven years since President [Barack] Obama signed the now-threatened Affordable Care Act.” Republicans, however, “hope to mark the anniversary with a successful House vote to repeal the law known as Obamacare” and pass the American Health Care Act (AHCA). From the March 22 report:
Thursday will mark seven years since President Obama signed the now-threatened Affordable Care Act before a crowd in the jam-packed East Room of the White House. It was the signature legislative moment of his presidency, underscored by then-Vice President Biden, who whispered into the president’s ear that it was a “big f****** deal.” The mic picked up the remark, which created quite a stir.
Now, Republicans hope to mark the anniversary with a successful House vote to repeal the law known as Obamacare. Democrats still hope to derail that effort — though their best chance lies in complaints about the GOP proposal by conservative Republicans, some of whom label it “Obamacare Lite.” [NPR, 3/22/17]
CNN: The House Delayed The Vote “Putting Efforts To Repeal And Replace Obamacare In Jeopardy.” CNN reported that “the House will not vote on the Republican health care bill Thursday” according to a GOP aide, which puts “efforts to repeal and replace Obamacare in jeopardy.” From the March 23 article:
The House will not vote on the Republican health care bill Thursday, a GOP aide said, further putting efforts to repeal and replace Obamacare in jeopardy.
The decision came after multiple high-level and tense meetings at the White House and Capitol that failed to broker a compromise. [CNN, 3/23/17]
MYTH: The ACA Created “Death Panels”
Right-Wing Media’s “Death Panels” Myth Began With Serial Misinformer Betsy McCaughey And Spread. Since 2009, right-wing media have been pushing the falsehood that the ACA created “death panels.” It started when serial health care misinformer Betsy McCaughey falsely claimed that the law would “require” end-of-life counseling for seniors to “tell them how to end their life sooner.” The claim was amplified by former Fox News contributor Sarah Palin and also made its way to conservative radio host Rush Limbaugh, as well as Sean Hannity, who claimed that “Obamacare death panels are in fact alive and well.” Fringe outlets, including Breitbart, also hyped the false allegation that “death panels” were “a part of Obamacare.” [Media Matters, 6/1/16, 5/23/15, 12/5/14, 4/14/14, 10/1/13, 8/13/13, 3/7/13, 9/28/12, 6/25/12, 3/22/12, 3/22/12]
“Death Panel” Claims Have Been Conclusively Discredited. After Palin made her claim, PolitiFact explained, “There’s certainly no ‘death board’ that determines the worthiness of individuals to receive care,” and it noted that “Palin’s statement sounds more like a science fiction movie … than part of an actual bill before Congress.” The fact-checker rated her claim “Pants on Fire.” Additionally, in December 2009, PolitiFact named the “death panel” smear its “Lie of the Year.” From the August 10, 2009, piece:
We’ve looked at the inflammatory claims that the health care bill encourages euthanasia. It doesn’t. There’s certainly no “death board” that determines the worthiness of individuals to receive care.
MYTH: Obamacare Resulted In Job Losses, Forced Workers Into Part-Time Work, And Cut Hours
Right-Wing Media Predicted Massive Job Losses, More Part-Time Work, And A Reduction In Hours Worked Due To ACA. Conservative media outlets and figures claimed that the ACA would drive companies to mass layoffs and slammed the legislation as a “job destroyer.” Former Wall Street Journal writer and editorial board member Stephen Moore asserted that the law would create a large-scale shift from full-time to part-time work. Additionally, The Columbus Dispatch’s editorial board claimed in 2013 that “many employers are cutting employee hours” due to the law. [Media Matters, 2/26/16, 1/29/16, 1/5/16, 12/8/15, 9/22/15, 8/17/15, 6/15/15, 4/14/14, 11/26/13, 10/1/13, 9/6/13, 8/30/13, 8/29/13, 8/21/13, 11/20/12]
Study: There’s “Very Limited Evidence” That Employers Are Reducing Employees’ Hours Due To The ACA. Health Affairs’ blog pointed out a 2015 study that found there is “very limited evidence” to support claims that “the employer mandate” is causing “companies to reduce some employees’ hours to avoid providing them with health insurance.” From the January 5, 2016, blog post:
When the ACA took effect, some policymakers were concerned that the employer mandate would cause companies to reduce some employees’ hours to avoid providing them with health insurance, and that incentives surrounding expanded access to affordable coverage would lead workers to voluntarily reduce the hours they work.
Asako Moriya of the Agency for Healthcare Research and Quality (AHRQ) and coauthors examined data from the Current Population Survey (CPS) for the years 2005–15 and found very limited evidence to support this speculation. According to the authors, the adjusted probability of working part time before and after the ACA enactment, whether done voluntarily or involuntarily, did not show significant change. (See exhibit below for the overall adjusted trends in working full time versus part time.) The CPS data distinguishes between involuntary part-time work (wanting to work full time but unable to) and voluntary part-time work (choosing to work part time for a number of reasons). The authors recommend future research on this subject to further capture the phasing in of the employer mandate and any lagged effects of the ACA on employment. [Health Affairs, 1/5/16]
Urban Institute: The ACA Has “Had Virtually No Adverse Effect” On Employment. According to an August 2015 study by the Urban Institute, the ACA has “had virtually no adverse effect on labor force participation, employment, or usual hours worked per week through 2014.” In particular, the study found that total employment for working-age adults was 1.8 percentage points higher than expected, which is “inconsistent with predictions that the ACA would decrease employment.” From the August 2015 study:
We find that the ACA had virtually no adverse effect on labor force participation, employment, or usual hours worked per week through 2014. This conclusion is true for ACA policies overall and for the Medicaid expansions in particular, and it applies to the full sample of nonelderly persons and to the subgroup of nonelderly persons with a high school education or less who are more likely to be affected by the ACA.
For nonelderly adults with a high school education or less, we find that employment in 2014 is 1.8 percentage points higher than what would be expected given the rates of unemployment, demographic characteristics and pre-existing time trends. This finding is inconsistent with predictions that the ACA would decrease employment.
Also for nonelderly adults with a high school education or less, we find that part-time employment is higher than expected by 0.5 percentage points. This finding is consistent with some predictions that the ACA would increase part-time work, but may also reflect the continuing recovery in the labor market. This difference is sufficiently small, however, that we find no evidence of a change in the number of hours worked in 2014 and thus no overall change in labor supply beyond what would be expected.
The ACA’s Medicaid expansions had virtually no effect on labor market outcomes through the end of 2014. This finding is consistent with the best available previous evidence, which suggests any effects of Medicaid expansions on employment are likely to be small. [Urban Institute, August 2015]
MYTH: Democrats “Ram[med]” The ACA Through Congress
Conservative Media Figures Claimed Democrats “Ram[med]” The ACA Through Congress. Right-wing media figures suggested that Democrats were trying to “ram” the ACA through Congress. Washington Post columnist Marc Thiessen wrote in 2010 that Democrats were trying “to ram through their health-care legislation using extraordinary parliamentary procedure.” A 2010 Washington Times editorial also claimed, “Democrats have agreed to a policy and how to ram it through Congress.” [Media Matters, 2/25/10]
New Republic: “The Obamacare Debate Was One Of The Most Transparent In Recent Memory.” The New Republic’s Brian Beutler pointed out that the ACA “actually stands out for how much it was debated, and, for the most part, how transparent that debate was.” From the November 12, 2014, article (emphasis original):
Conservatives have always said the health care law wasn’t debated, that it was rammed through, nobody read it, etc, etc. But it actually stands out for how much it was debated, and, for the most part, how transparent that debate was. Which in turn explains how difficult it was to pass. [New Republic, 11/12/14]
Senate Held Years Of Bipartisan Hearings On Health Care Reform Before The ACA Passed. Former Senate Finance Committee Chairman Max Baucus (D-MT) posted a timeline of his committee’s work on health care reform since 2008, which included more than a dozen hearings through 2008 and 2009 and “31 bipartisan meetings to discuss the development of a health care reform bill” between June and September of 2009. [Senate.gov, accessed 3/22/17]
MYTH: Young, Healthy People Would Be Priced Out And Wouldn’t Buy Insurance, Throwing The Markets Into A Death Spiral
Conservatives Feared That Young, Healthy People Needed To Balance Out Markets Wouldn’t Buy Insurance Due To High Costs. Conservatives hyped fears that young and healthy people would pay a penalty instead of purchasing insurance because the law would make health care coverage unaffordable for them. The Columbus Dispatch’s editorial board called this fear a “leading concern” about the law. After the law went into effect, the hosts of Fox News’ Fox & Friends suggested that the number of young people on the exchanges wasn’t enough to avoid a “death spiral.” Fox News Sunday host Chris Wallace also claimed that there was a “big hole” in the number of young people who needed to be insured to balance the market. [Media Matters, 4/14/14, 3/31/14, 8/29/13]
Health Care Experts: The ACA Has Enough Young Enrollees To Avoid “Death Spiral.” A report by the Kaiser Family Foundation pointed out that if young people made up just 25 percent of the total enrollment — even though they represented 40 percent of the potential market — the insurance companies would still be expected to make a profit and the effect on premiums “would be well below the level that would trigger a ‘death spiral.'” [Kaiser Family Foundation, 12/17/13, via Media Matters 4/14/14]
MYTH: Expanding Medicaid Is Unaffordable For States
Right-Wing Media Claimed “We Don’t Have The Money” To Expand Medicaid In Some States. Right-wing media figures raised speculative fears over the Medicaid expansion. Fox Business host Stuart Varney claimed that “we don’t have the money” to pay for this program. and Fox Business’ David Asman alleged that the expansion would be “an extraordinary extra cost to taxpayers.” [Media Matters, 12/11/13, 11/13/13]
FACT: State Medicaid Expansion Is Largely Covered By The Federal Government And Ends Up Saving Money For States
NPR: States That Didn’t Take The Medicaid Expansion Saw Costs Rise Faster. According to NPR, in a “counterintuitive twist,” “states that didn’t expand Medicaid eligibility as part of Obamacare last year saw their costs to provide health care to the poor rise twice as fast as states that extended benefits to more low-income residents.” NPR cited a survey from the Kaiser Family Foundation which found that states “that didn’t broaden coverage saw their Medicaid costs rise 6.9 percent in the fiscal year that ended Sept. 30.” However, “the 29 states that took President Obama up on his offer to foot the bill for expanding Medicaid saw their costs rise only 3.4 percent.” From the October 15, 2015, article:
The 22 states that didn’t expand Medicaid eligibility as part of Obamacare last year saw their costs to provide health care to the poor rise twice as fast as states that extended benefits to more low-income residents.
It’s a counterintuitive twist for those states whose governors, most Republicans who opposed the Affordable Care Act, chose not to accept federal funds to extend Medicaid to more people.
A Kaiser Family Foundation survey of Medicaid directors in all 50 states and Washington, D.C., showed that those that didn’t broaden coverage saw their Medicaid costs rise 6.9 percent in the fiscal year that ended Sept. 30. The 29 states that took President Obama up on his offer to foot the bill for expanding Medicaid saw their costs rise only 3.4 percent. [NPR, 10/15/15]
CBPP: State Costs For Medicaid Expansion Are A Small Fraction Of Projected Medicaid Spending. The Center on Budget and Policy Priorities (CBPP) explained that expanding Medicaid coverage would account for only a 2.8 percent increase in spending on Medicaid between 2014 and 2022 based on the amount “already projected for the same time period.” From the 2013 report:
According to CBO, between 2014 and 2022, the federal government will pay $931 billion of the cost of the Medicaid expansion, while states will pay roughly $73 billion, or 7 percent. This $73 billion equals a 2.8 percent increase above the $2.6 trillion that states were projected to spend on Medicaid over the same timeframe in the absence of health reform. [Center on Budget and Policy Priorities, 10/22/13]
NY Times: Study Shows Health Insurance Reform Will Improve Budget Situation For Many States. According to a July 2012 New York Times Economix blog post, an Urban Institute study “ran the numbers for all 50 states and the District of Columbia” and estimated that “21 to 45 states would save money by taking the Medicaid expansion.” The study showed that “state governments are likely to spend $92-129 billion less from 2014 to 2019 with implementation of the Affordable Care Act, thanks to provisions reducing the uninsured population and increasing federal support for health care previously financed by states.” The study also showed that states “will still come out ahead” when the federal government’s share of the costs decreases. [The New York Times, 7/5/12; Urban Institute, 7/13/11]
MYTH: The Net Health Insurance Enrollment Due To The ACA Was “Quite Negative”
Conservative Media Figures Claimed The ACA Had A “Negative” Effect On Enrollment. Right-wing media figures attempted to dismiss the impact of the ACA by claiming the law had a “negative” effect on health insurance enrollment. Fox’s Elisabeth Hasselbeck claimed that the “net result” of Obamacare was “quite negative.” Fox host Jon Scott alleged that the number of people enrolled in health insurance under the ACA was “practically a net wash.” [Media Matters, 3/31/14, 3/24/14]
Huff. Post: “Twenty Million Previously Uninsured Americans Gained Coverage” Under The ACA. According to The Huffington Post, under the ACA, the “share of Americans who don’t have health coverage fell below 9 percent during the first half of , the lowest percentage ever recorded.” The article went on to note that “Twenty million previously uninsured Americans gained coverage since President Barack Obama’s Affordable Care Act was enacted in 2010.” From the November 3 article:
The share of Americans who don’t have health coverage fell below 9 percent during the first half of this year, the lowest percentage ever recorded, according to survey results published by the Centers for Disease Control and Prevention on Thursday.
The uninsured rate held steady from the end of 2015, slightly declining to 8.9 percent, or 28.4 million people, the CDC report says. The share of uninsured Americans fell more than 5 percentage points since 2013, the year before the Affordable Care Act’s coverage expansion took effect.
This latest survey of the uninsured population underscores what the Affordable Care Act, also known as Obamacare, has achieved in its first three years of being fully online. The uninsured rate had hovered around 15 percent in previous years, until the health care reform law’s expansion of Medicaid to poor adults, and introduction of subsidized private health insurance for low- and moderate-income families became available.
Twenty million previously uninsured Americans gained coverage since President Barack Obama’s Affordable Care Act was enacted in 2010, the Department of Health and Human Services reported in March. [The Huffington Post, 11/3/16]
MYTH: The ACA Is Socialized Medicine
Conservative Media Embraced GOP Claim That The ACA Is “Government-Run Health Insurance.” Conservative media figures embraced the Republican Party’s claim that the ACA was creating socialized medicine. Fox’s Chris Stirewalt adopted the label, calling the legislation “government-run health insurance.” Then-Fox News contributor Monica Crowley smeared the legislation as “socialized medicine,” while conservative radio host Mark Levin referred to the law as a “cancer” and a “top-down, iron-fisted, Soviet-style program.” [Media Matters, 11/13/13, 10/1/13, 9/25/13, 4/14/14, 9/18/13, 3/30/09, 3/5/09, 3/4/09, 3/2/09]
PolitiFact: “At Its Heart,” The ACA “Relies On Private Companies And The Free Market.” In a December 16, 2010, post declaring the claim that the ACA is a “‘government takeover of health care’” the “lie of the year” for 2010, PolitiFact noted that it’s “simply not true.” PolitiFact explained that the law “relies largely on the free market” and “private companies.” From the post:
PolitiFact editors and reporters have chosen “government takeover of health care” as the 2010 Lie of the Year. Uttered by dozens of politicians and pundits, it played an important role in shaping public opinion about the health care plan and was a significant factor in the Democrats’ shellacking in the November elections.
The phrase is simply not true.
“Government takeover” conjures a European approach where the government owns the hospitals and the doctors are public employees. But the law Congress passed, parts of which have already gone into effect, relies largely on the free market:
• Employers will continue to provide health insurance to the majority of Americans through private insurance companies.
• Contrary to the claim, more people will get private health coverage. The law sets up “exchanges” where private insurers will compete to provide coverage to people who don’t have it.
• The government will not seize control of hospitals or nationalize doctors.
• The law does not include the public option, a government-run insurance plan that would have competed with private insurers.
• The law gives tax credits to people who have difficulty affording insurance, so they can buy their coverage from private providers on the exchange. But here too, the approach relies on a free market with regulations, not socialized medicine.
PolitiFact reporters have studied the 906-page bill and interviewed independent health care experts. We have concluded it is inaccurate to call the plan a government takeover because it relies largely on the existing system of health coverage provided by employers.
It’s true that the law does significantly increase government regulation of health insurers. But it is, at its heart, a system that relies on private companies and the free market. [PolitiFact, 12/16/10]
MYTH: The ACA Covered Undocumented Immigrants
Conservatives Hyped The False Claim That Obamacare Covered Undocumented Immigrants. Former Fox News contributor Dick Morris fearmongered that Americans would be denied health insurance in favor of undocumented immigrants, claiming, “Whether they fund the grief counselor or the end-of-life counselor or not, the rationing will take place when they tell you, no, you can’t have the surgery because we have to give it to a 40-year-old illegal immigrant instead.” Conservative radio host Chris Plante asserted that former President Obama was “giving a wink and a nod to illegal aliens to sign up for Obamacare.” Radio host Laura Ingraham also suggested that Obama could give health care to “anyone that he decides to defer immigration action on,” adding, “The DREAMers can get Obamacare.” [Media Matters, 4/14/14, 3/19/14, 3/7/14]
Both The House And Senate Bills Excluded Those “Not Lawfully Present” In The United States. Both the America’s Affordable Health Choices Act and the Affordable Health Choices Act, the two bills that would become the Affordable Care Act, excluded “individuals who are not lawfully present in the United States” from receiving health care benefits. [Media Matters, 8/20/09]
MYTH: The ACA Covers Abortions
Right-Wing Media Alleged That The ACA Covers Abortions. Conservative media outlets claimed that the ACA would cover abortions. The Washington Times wrote in 2012 that “taxpayer funding of abortions” was “set to increase under Obamacare.” A Drudge report headline from 2014 stated that “Feds approve taxpayer subsidies for abortion coverage” in the ACA. Las Vegas Review-Journal columnist Sherman Frederick also claimed that the law would fund abortions. [Media Matters, 10/1/13, 1/28/14, 10/3/13, 10/1/13, 11/6/09; Las Vegas Review-Journal, 2/7/12]
Neither The 2009 Public Option Nor 2010 Senate Bill Provided Government Payments For Abortion. Neither the 2009 House bill nor the 2010 Senate bill included federal funding or subsidies for abortion. Both bills specified that separate funds must be used to fund abortions except in cases allowed by the Hyde Amendment, which bans the federal government from paying for abortions unless the pregnancy is “the result of an act of rape or incest” and in cases where a woman is “in danger of death unless an abortion is performed.” [Media Matters, 11/6/09]
MYTH: The ACA Deepens Income Inequality
Right-Wing Media Claimed The ACA Would Deepen Income Inequality And Hurt Poor People. Conservative media figures alleged that Obamacare would disproportionately hurt poor people while increasing income inequality. Fox host Dana Perino asserted that the law “exacerbates income inequality” and would “end up hurting low-income people.” Forbes’ Merrill Matthews alleged in 2012 that the ACA would “dramatically exacerbate” income inequality.” [Media Matters, 3/31/14, Forbes, 6/22/12]
Brookings Institution: The ACA “Will Improve The Well-Being And Incomes Of Americans In The Bottom Fifth Of The Income Distribution.” A study from the Brookings Institution found that the ACA “will improve the well-being and incomes of Americans in the bottom fifth of the income distribution.” Additionally, the 2014 study found that “incomes in the bottom one-fifth of the distribution will increase almost 6%; those in the bottom one-tenth of the distribution will rise more than 7%.” From the January 27, 2014, summary of the study:
The Affordable Care Act (ACA) will improve the well-being and incomes of Americans in the bottom fifth of the income distribution. Under our broadest and most comprehensive income measure we project that incomes in the bottom one-fifth of the distribution will increase almost 6%; those in the bottom one-tenth of the distribution will rise more than 7%. These estimated gains represent averages. Most people already have insurance coverage that will be left largely unaffected by reform. Those who gain subsidized insurance will see bigger percentage gains in their income.
[Brookings Institution, 1/27/14]
MYTH: The ACA Created A Bailout For Insurers That Don’t Make A Profit
Conservative Media Claimed The ACA Was A Bailout For Insurers That Didn’t Make A Profit. Right-wing media asserted that one provision of the ACA — the risk corridors — was to bail out insurers with taxpayer funds when they didn’t make money. Fox’s Steve Doocy alleged that the Obama administration told insurers that it would “bail you out.” Former Fox host Gretchen Carlson claimed that a provision in the law would have “the government bailing out insurance companies once costs run over a certain amount” and that “taxpayers could be forced to pick up the tab yet again.” Additionally, The Weekly Standard claimed that insurers “won’t bear the cost of their own losses–at least not more than about a quarter of them. The other three-quarters will be borne by American taxpayers.” [Media Matters, 1/14/14, 1/13/14]
Risk Corridors And Reinsurance Are Payments Between Insurance Companies, Not Taxpayer Money. As Matthew Yglesias, then of Slate, explained, risk corridors and reinsurance are payments managed by the federal government, but do not cost the taxpayers money. Instead, for a few years after the implementation of the exchanges, money is transferred from more profitable insurance companies to those that are less profitable. Yglesias pointed out that reinsurance is a “tax on insurance companies that pays for a subsidy to insurance companies.” From the October 14, 2013, article:
The underlying issue is that the framers of the Affordable Care Act were concerned that in its early years the ACA exchanges would disproportionately attract older and less healthy applicants. To help ensure that the program got off the ground, it includes federally funded “reinsurance” for health care plans in the exchanges. To avoid turning that into a net subsidy to the insurance industry, the reinsurance is funded by an industry-wide levy on work-provided insurance plans. It’ll be $12 billion in 2014, ratcheting down to $8 billion in 2015, and $5 billion in 2016. [Slate, 10/14/13]
MYTH: Obamacare Has Been In A “Death Spiral”
Conservative Media Have Repeatedly Hyped Claims That ACA Was In A “Death Spiral.” On numerous occasions, conservative media figures claimed that the ACA was on the verge of a “death spiral,” a cycle in which high costs cause people to leave the system, ultimately resulting in its collapse. After scheduled premium increases took place in October, Fox Business host Stuart Varney claimed the law was “in collapse mode.” Likewise, Fox’s Bret Baier suggested that premium hikes were “confirmation that insurance markets … are on the verge of collapsing in what [Republicans] call a death spiral.” After Aetna announced in August it would be departing from the law’s exchanges, Fox’s Jesse Watters predicted that “this is the death spiral that everybody here warned you about.” [Media Matters, 10/25/16; 8/16/16]
CBS News: “Fact Check: Obamacare Is Not In A ‘Death Spiral.’” CBS News fact-checked the assertion that Obamacare is in “a death spiral,” noting that these claims “are exaggerated, if not downright false.” The article emphasized that “experts agree that the law is not currently in a ‘death spiral.’” From the January 10 article:
President-elect Donald Trump says that President Barack Obama’s health care law “will fall of its own weight.”
House Speaker Paul Ryan says the law is “in what the actuaries call a death spiral.”
And Senate Majority Leader Mitch McConnell says that “by nearly any measure, Obamacare has failed.”
The problem with all these claims: They are exaggerated, if not downright false.
TRUMP, RYAN AND MCCONNELL: The law will “fall of its own weight,” is in a “death spiral” and “has failed.”
THE FACTS: Experts agree that the law is not currently in a “death spiral,” an actuarial term that refers to a vicious cycle when rising insurance costs force healthy customers out of the marketplace, resulting in still higher prices, which cause even more customers to bail, etc., until the system collapses.
But some say that if the current situation continues, that is a likely or possible scenario. Health care premiums are jumping by double digits this year, and the health care marketplaces created by the law are short on the healthy consumers who make insurance companies profitable.
“It’s not a failure in that 20 million people or more have insurance that didn’t used to have insurance. Everything else, it’s too early to judge,” said economist Gail Wilensky, who ran Medicare under former President George H.W. Bush.
“To say that the exchange markets remain unstable and in turmoil is an appropriate statement,” she said. “To say that they’re in a death spiral really depends on what happens.”
The American Academy of Actuaries itself disputed the “death spiral” claim Monday. The group provided a statement from its senior health fellow asserting that high premium increases in many states this year “do not necessarily indicate that a premium spiral is occurring” and could be a one-time adjustment. [CBS News, 1/10/17, via Media Matters, 3/7/17]
NY Times: Low-Income People In States “Which Expanded Medicaid” Under ACA “Appear To Be Healthier Than Their Peers.” The New York Times’ Upshot blog highlighted a study in JAMA Internal Medicine, which found, “Low-income people in Arkansas and Kentucky, which expanded Medicaid insurance to everyone below a certain income threshold, appear to be healthier than their peers in Texas, which did not expand.” According to the Times, the study found “people in Arkansas and Kentucky were nearly 5 percent more likely than their peers in Texas to say they were in excellent health in 2015” and “people in Kentucky and Arkansas were less likely to postpone care or avoid taking prescribed drugs because of the cost, and that they were less likely to be struggling with a medical bill.” From the August 9 blog post:
A new study, published Monday in JAMA Internal Medicine, offers another way of looking at the issue. Low-income people in Arkansas and Kentucky, which expanded Medicaid insurance to everyone below a certain income threshold, appear to be healthier than their peers in Texas, which did not expand.
Their survey found people in Arkansas and Kentucky were nearly 5 percent more likely than their peers in Texas to say they were in excellent health in 2015. And that difference was bigger than it had been the year before.
On financial measures, the study was in line with some previous studies, finding that people in Kentucky and Arkansas were less likely to postpone care or avoid taking prescribed drugs because of the cost, and that they were less likely to be struggling with a medical bill. [The New York Times, 8/9/16]
NY Times: Obamacare Has “Cut Down … Debt Substantially” Among Low-Income People. The New York Times’ Upshot blog highlighted another study that found that “by giving health insurance to low-income people, Obamacare seems to have cut down on their debt substantially.” As the Times pointed out, “one in five Americans still struggle to pay a medical bill, even after the Affordable Care Act. But several studies show that the number has declined as insurance coverage has expanded.” From the April 21 blog post:
A new study is showing that, by giving health insurance to low-income people, Obamacare seems to have cut down on their debt substantially. It estimates that medical debt held by people newly covered by Medicaid since 2014 has been reduced by about $600 to $1,000 each year.
The study, published Monday as a working paper by the National Bureau of Economic Research, builds on earlier evidence from Oregon and Massachusetts that offering health insurance to low-income Americans can help them avoid debt and financial shocks.
A survey that The Upshot conducted with the Kaiser Family Foundation found that about one in five Americans still struggle to pay a medical bill, even after the Affordable Care Act. But several studies show that the number has declined as insurance coverage has expanded. [The New York Times, 4/20/16]
Guttmacher Institute: Reproductive-Age Women Have Gained Coverage Under The ACA. A November report by the Guttmacher Institute explained that the ACA caused a “considerable decline in the uninsured rate” among “women of reproductive age.” The report found that the decline “was particularly pronounced in states that had expanded Medicaid under the ACA.” From the November report:
The proportion of women of reproductive age (15–44) who were uninsured dropped by 36% between 2013 and 2015, over the first two full years of implementation of the Affordable Care Act (ACA). This considerable decline in the uninsured rate, calculated by the Guttmacher Institute using data from the U.S. Census Bureau’s American Community Survey, mirrors broader national insurance trends, and was particularly pronounced in states that had expanded Medicaid under the ACA.
Overall, the proportion of reproductive-age women without health insurance fell from about 20% in 2013 to 13% in 2015; all told, 8.2 million reproductive-age women were uninsured in 2015. The change was driven by substantial gains in both Medicaid coverage and private insurance. Medicaid, the federal-state health insurance plan for low-income individuals and families, covered 20% of reproductive-age women in 2015, or 12.9 million women. [Guttmacher Institute, November 2016]
NY Times: Minorities, Immigrants, And Low-Wage Workers Saw Big Gains Under The ACA. A New York Times analysis found that the ACA “brought historic increases in coverage for low-wage workers” and “immigrants of all backgrounds.” Additionally, the Times noted, “Minorities, who disproportionately worked in low-wage jobs, had large gains” under the law. From the April 17 analysis:
The first full year of the Affordable Care Act brought historic increases in coverage for low-wage workers and others who have long been left out of the health care system, a New York Times analysis has found. Immigrants of all backgrounds — including more than a million legal residents who are not citizens — had the sharpest rise in coverage rates.
Hispanics, a coveted group of voters this election year, accounted for nearly a third of the increase in adults with insurance. That was the single largest share of any racial or ethnic group, far greater than their 17 percent share of the population. Low-wage workers, who did not have enough clout in the labor market to demand insurance, saw sharp increases. Coverage rates jumped for cooks, dishwashers, waiters, as well as for hairdressers and cashiers. Minorities, who disproportionately worked in low-wage jobs, had large gains. [The New York Times, 4/17/16]
Kaiser Family Foundation: The ACA Gave The LGBTQ Community “Expanded Access To Coverage.” According to a presentation by the Kaiser Family Foundation, the ACA gave the LGBTQ community “expanded access to coverage,” as well as “preventative services” and “non-discrimination protections.” [Kaiser Family Foundation, accessed 3/22/17]
AHCA Will Expand Limits For Health Savings Accounts (HSAs)
CNBC: The AHCA “Will Nearly Double The Contribution Limits For Health Savings Accounts.” According to a CNBC report, the AHCA “will nearly double the contribution limits for health savings accounts and give people more flexibility in how they can spend money in these tax-advantaged accounts.” From the March 7 report:
Provisions of the newly unveiled American Health Care Act will nearly double the contribution limits for health savings accounts and give people more flexibility in how they can spend money in these tax-advantaged accounts.
HSAs, introduced in 2003, offer you triple tax advantages: First, contributions are tax-deductible. Second, those contributions can be invested and grow tax-free. Third, withdrawals aren’t taxed as long as you use them for qualified medical expenses, such as doctor’s visits, prescription drugs and dental care.
For older account holders, you can use your HSA to pay for Medicare premiums and out-of-pocket expenses including deductibles, co-pays and coinsurance (except Medigap). [CNBC, 3/7/17]
MYTH: HSAs Are An Effective Tool For Increasing Choice And “Empowering Patients”
Pacific Research Institute’s Sally Pipes: Health Savings Accounts “Empower … Patients To Take Control Of Their Care.” Conservative author Sally Pipes, president of the libertarian Pacific Research Institute, wrote an op-ed in Investor’s Business Daily advocating for the expansion of health savings accounts, claiming they “empower … patients to take control of their care.” She claimed that “HSA contributions help lower long-term healthcare spending” and encourage lawmakers to do “everything they can to get them in the hands of more people.” From the February 29, 2016, article:
They’re right to bet on HSAs, whose popularity has exploded in recent years. By empowering patients to take control of their care, HSAs have injected some consumerist discipline into the marketplace.
Because consumers have direct control over their HSA dollars, they have a strong incentive to spend their money wisely. Perhaps they’ll pick the low-cost generic over the name-brand drug — or compare what different hospitals charge for an elective procedure.
Twelve years ago, HSAs didn’t exist. Today, 20 million people count on them. They’ve empowered consumers to take charge of their care and saved the healthcare system money. Lawmakers should be doing everything they can to get them in the hands of more people. [Investor’s Business Daily, 2/29/16]
CBPP’s Edwin Park: “GOP Health Savings Account Proposals Would Mostly Help Wealthy, Not Uninsured.” Edwin Park, vice president for health policy at CBPP, argued that expanding HSAs “would mainly benefit high-income taxpayers and likely do little for those losing their health coverage if the ACA were repealed.” Park explained that “because a tax deduction rises in value with an individual’s tax bracket, HSAs provide the largest tax benefits to high-income individuals.” He noted that “research shows that at least 90 percent of the uninsured before the ACA were in the 0, 10, or 15 percent tax bracket, so they would receive an income tax benefit of no more than 15 cents for every $1 they can deduct — not enough to make coverage affordable.” From the November 17 article:
For his alternative to the Affordable Care Act (ACA), which he would repeal, President-elect Trump proposes to rely on Health Savings Accounts (HSAs). That’s consistent with the health plans of House Speaker Paul Ryan and other congressional Republicans, which would expand HSAs in ways that would mainly benefit high-income taxpayers and likely do little for those losing their health coverage if the ACA were repealed.
Because a tax deduction rises in value with an individual’s tax bracket, HSAs provide the largest tax benefits to high-income individuals. In addition, research shows that high-income people are likelier to make the maximum annual contributions to HSAs. Since there are no income limits on HSA participation, affluent people whose incomes are too high to qualify for individual retirement accounts (IRAs) or who have “maxed out” their 401(k) contributions can use HSAs to shelter more funds. Households with incomes of at least $100,000 account for most tax returns claiming an HSA deduction and the large majority of the total amount of HSA contributions.
Many other congressional Republican HSA expansion proposals (including the RSC plan) would also allow HSA funds to pay health insurance premiums. Because HSA contributions are tax-deductible, this would effectively create a tax deduction for the premium costs of a high-deductible plan in the individual health insurance market. But it would do little or nothing to help the uninsured. Research shows that at least 90 percent of the uninsured before the ACA were in the 0, 10, or 15 percent tax bracket, so they would receive an income tax benefit of no more than 15 cents for every $1 they can deduct — not enough to make coverage affordable. Those with no federal income tax liability would receive zero benefit. [Center on Budget and Policy Priorities, 11/17/16]
Economist Kathryn Phillips: Health Savings Accounts “Primarily Benefit The Wealthy, The Healthy, And The Educated.” Health care economist Kathryn Phillips of the University of California, San Francisco, wrote an article in Health Affairs outlining that while “HSAs are conceptually appealing,” in reality, “they primarily benefit the wealthy, the healthy, and the educated.” She noted that “most low-income individuals do not have a high enough tax liability to benefit from the tax deductions associated with HSAs.” She explained that “HSAs benefit not only the wealthier more but also healthier individuals who are more likely to be able to benefit from accrued savings over time.” She also emphasized that “an important but often neglected aspect of HSAs is that they require an educated and savvy consumer who can devote a great deal of time and effort to understanding their plan and shopping for care.” From the December 8 article:
One of the reforms proposed as part of the Trump health platform is to “allow individuals to use Health Savings Accounts (HSAs).” This increased emphasis on HSAs is a clarion call for more understanding about how to make HSAs work so that they are equitable, effective, and efficient.
Although HSAs are conceptually appealing and can play an important role in health reforms, current evidence suggests that they primarily benefit the wealthy, the healthy, and the educated. Thus, new approaches will be needed if HSAs are to be used more widely and improve health outcomes for the broader population.
In general, studies have found that HSAs combined with high-deductible plans can decrease overall use of services and costs, but there is little evidence yet that this results in improved health status. Most low-income individuals do not have a high enough tax liability to benefit from the tax deductions associated with HSAs — and that assumes that they even have enough disposable income to put aside into a savings account. Studies have found that the impact of HSAs differs by income level, e.g., lower-income workers (and their dependents) were more likely than higher-income individuals to reduce their use of physician office visits and certain high-value services not subject to the deductible, such as influenza vaccinations and breast cancer screenings. HSAs benefit not only the wealthier more but also healthier individuals who are more likely to be able to benefit from accrued savings over time. [Health Affairs, 12/8/16]
Kaiser Family Foundation: HSAs Can Increase Out-Of-Pocket Costs For “People With Chronic Conditions, Disabilities, And Others With High-Cost Medical Needs” And Don’t Increase Coverage Among The Uninsured. A Kaiser Family Foundation issue paper on the use of HSAs in low-income families found that “people with chronic conditions, disabilities, and others with high-cost medical needs may face even greater out-of-pocket costs under HSA-qualified health plans.” The brief also noted that HSAs “are unlikely to substantially increase health insurance coverage among the uninsured” because the majority of uninsured Americans are low-income and thus receive few benefits from HSAs. From the October 2006 report:
People with chronic conditions and disabilities often experience higher medical costs than those without these conditions. For example, the total health care costs for individuals with asthma, heart disease, and diabetes are more than double that of nonelderly adults in general. As a result, these individuals are much more likely to reach their deductible level each year, which by design, is set at a much higher level in HDHPs.
Health Savings Accounts and HDHPs are likely to be more attractive to healthy individuals and families who have had few major medical expenses. If the healthiest increasingly enroll in HSA qualified HDHPs while persons with chronic conditions and those with higher medical expenses remain in existing health plans, the premiums for traditional coverage will rise accordingly for the least healthy.
Over two-thirds of the nonelderly uninsured are low-income. Because they earn so little, over half of the uninsured have no tax liability. As such, health insurance proposals that rely on tax deductions as an incentive will have limited impact on the number of uninsured. In addition, high deductible health plans that require higher out-of-pocket spending will not offer the low-income uninsured enough financial protection to offset the premium cost. [Kaiser Family Foundation, October 2006]
Families USA: Health Savings Accounts “Are No Substitute For Health Insurance With Real Coverage Guarantees.” A Families USA fact sheet emphasized that HSAs “are no substitute for health insurance with real coverage guarantees we have today.” It also noted that they “don’t work for most families” that “do not have the additional financial resources to set aside thousands of dollars to pay for health care bills” and often just provide “another tax shelter for the wealthy.” From the February 2017 fact sheet:
Health Savings Accounts (HSAs)—Health Savings Accounts are not health insurance; they merely provide a place where people can stash their own money to later spend on health care. They are no substitute for health insurance with real coverage guarantees we have today. And these accounts don’t work for most families, especially those living paycheck to paycheck, who can’t afford to set aside thousands of dollars to pay the full cost of their health care bills. They are just another tax shelter for the wealthy.
The majority of families who actually put money in health savings account are households making more than $100,000 each year.
When you look at all of the money put into health savings accounts in a year, 70 percent of that money comes from higher-income homes (households making more than $100,000).
More than 15 million family households in the United States are headed by women. About 29 percent of those families, or 4.4 million family households, have incomes that fall below the poverty level. Women and families living in poverty simply do not have the additional financial resources to set aside thousands of dollars to pay for health care bills.
Plans that come with HSAs must have a deductible of at least $1,300 ($2,600 for a family). Kaiser Family Foundation found that 68 percent of lower-income households (between 100-250% of poverty) don’t have the financial assets to pay an even smaller $1,200 deductible. [Families USA, February 2017]
The AHCA Would Give States Funds To Possibly Put Into High-Risk Pools
Vox: Under AHCA, States Could Use Federal Money To “Build High-Risk Pools For Those With Exceptionally Costly Medical Conditions.” As Vox explained, the AHCA “would invest $100 billion over 10 years into a Patient and State Stability Fund,” which states could use to “build high-risk pools for those with exceptionally costly medical conditions.” From the March 6 article:
The leaked draft does have a safety net for people who can’t afford to buy this more-expensive coverage. It would invest $100 billion over 10 years into a Patient and State Stability Fund. States could use this money to bump up the size of the tax credits in the individual market (more on that in a minute), build high-risk pools for those with exceptionally costly medical conditions, or send money to insurers who get stuck with especially costly patients (people who have claims higher than $50,000 in a single year). [Vox, 3/6/17]
MYTH: High-Risk Pools Are An Effective Alternative To The ACA’s Ban On Not Insuring Those With Pre-Existing Conditions
Fox News’ Dr. Marc Siegel: “The Ultimate Goal Is Probably To Create High-Risk Pools Where Those With Pre-Existing Conditions Can Be Subsidized By The Government.” Fox News contributor Dr. Marc Siegel promoted high-risk pools as a way to insure those who currently have pre-existing conditions, claiming that “the ultimate goal” of the Trump administration’s ACA replacement plan “is probably to create high-risk pools where those with pre-existing conditions can be subsidized by the government.” He argued that “pre-existing conditions have to be covered” and high-risk pools are “where government subsidies should go.” From the February 6 edition of Fox News’ America’s Newsroom:
DR. MARC SIEGEL: Well, that’s why I think President Trump is saying it going to take a while, a year or two, for this whole thing to be fixed because the ultimate goal is probably to create high-risk pools where those with pre-existing conditions can be subsidized by the government. Right now almost everybody’s subsidized by the government. If you go to the state exchange you pay $350 for a premium, on average, $250 of that comes out of the taxpayer pocket. That’s what’s got to change. The state exchanges aren’t working, but critics are saying, “wait a minute, we don’t want 30 million to lose their insurance right away.” So let’s honor the state exchanges as we try to reform Medicaid, to get malpractice reform, to get a cheaper option, and to create high-risk pools.
MELISSA FRANCIS (HOST): Let me drill down on that point a little bit because that’s a solution that I haven’t heard from a lot of people that makes sense, because this is where it’s tricky. So you are saying put people into high-risk pools that go over different state lines, this is something Rand Paul had talked about as well. That still — in my mind of getting all of these people together — doesn’t solve the problem of how you pay for it. That’s just a bigger group. You’re are saying, of those pools, that is where the government’s money, that is already being spent frankly, should be directed.
SIEGEL: Absolutely. Because I agree, and many other critics of Obamacare agree, that pre-existing conditions have to be covered. That’s in the best interest of the government, it’s in the best interest of the patient, it’s the best interest of the doctor. I want to know that my diabetics, that those with heart disease, that those with emphysema are going to be covered. That’s where government subsidies should go. Why should someone else get a government subsidy who’s completely well? Why should the worried well get paid for by the government. That’s socialized medicine. [Fox News, America’s Newsroom, 2/6/17, via Media Matters, 2/16/17]
Investor’s Business Daily Columnist Betsy McCaughey: High-Risk Pools Are “An Honest Way To Subsidize Care For The Sick.” Serial health care misinformer Betsy McCaughey wrote a column for Investor’s Business Daily advocating for the creation of high-risk pools, arguing that “subsidizing high-risk pools in all 50 states would cost about $16 billion yearly,” which she claimed was “chicken scratch.” McCaughey characterized high-risk pools as “an honest way to subsidize care for the sick,” claiming that they “will stop premiums from skyrocketing in the individual market.” From the December 27 column:
Subsidizing high-risk pools in all 50 states would cost about $16 billion yearly. That figure assumes a per person cost of $32,000 — the same as in the federal transitional risk pool.
Congress, take note. Some Republican proposals in Congress only provide for $1 or $2 billion a year for state risk pools. That’s chicken scratch. $16 billion may sound like a fortune, but it’s less than half the $43 billion spent on Obamacare plan subsidies last year. And it’s money far better spent, because it directly helps the sickest among us.
Separate risk pools for the medically needy will stop premiums from skyrocketing in the individual market. Voila! Healthy people will be able to buy coverage at prices that reflect their own expected health needs.
Though Congress is divided, Democrats and Republicans should find common ground in reviving and fully funding high-risk pools. They’re an honest way to subsidize care for the sick. Obamacare used devious methods, spending billions on P.R. to convince the young and healthy to overpay for insurance. Most Americans weren’t fooled. [Investor’s Business Daily, 12/27/16, via Media Matters, 2/16/17]
FACT: High-Risk Pools Historically Fail, Resulting In Less Coverage And Skyrocketing Costs For States And Consumers
Commonwealth Fund: High-Risk Pools Are “Prohibitively Expensive To Administer,” “Prohibitively Expensive For Consumers,” And “Offer Much Less Than Optimal Coverage.” In a February 2015 report published by the Commonwealth Fund, social scientist Jean Hall, a health policy professor at the University of Kansas, critiqued the suggestion that high-risk pools could serve as “a viable alternative to the ACA’s ban on preexisting condition exclusions” and concluded they “are not a realistic alternative.” She emphasized that they are “prohibitively expensive to administer,” “prohibitively expensive for consumers,” and “offer much less than optimal coverage, often with annual and lifetime limits, coverage gaps, and very high premiums and deductibles.” From the February 13, 2015, report:
By concentrating risk, high-risk pools also concentrate costs, resulting in greater expenses to administrators and consumers and driving plans to impose severe coverage limits that often serve to negate the benefit of having insurance. Indeed, pronounced adverse selection is common in high-risk pools, because only the very sickest and most expensive individuals are willing to pay the high premiums for coverage, increasing administrative costs even more. This phenomenon was evident in several state-based high-risk pools, such as in California and Kansas, where enrollment declined from 2009 to 2011, but premiums totals and medical reimbursement costs increased, even with coverage limits in place.4 In stark contrast, coverage expansions under the Affordable Care Act spreading risk across a broad population to decrease per capita costs and allow for more affordable and comprehensive coverage for all. By their very nature, high-risk pools cannot and will not do so. [The Commonwealth Fund, 2/13/15]
Families USA: “High-Risk Pools Have Been Tried And They Failed.” A Families USA fact sheet criticized high-risk pools by pointing to their history of failure in 35 states that “tried using high-risk pools” and “ wound up covering a mere fraction of the number of people who have obtained coverage under the ACA.” The report also noted that “high-risk pools charged people about twice as much as the typical premiums” and included “lifetime maximums on how much they would pay for people’s care” — which are both banned by the ACA. From the February 2017 fact sheet:
High-risk pools—High-risk pools have been tried and they failed. In fact, 35 states tried using high-risk pools before insurers were banned from denying people with pre-existing conditions, and they only wound up covering a mere fraction of the number of people who have obtained coverage under the ACA. Moreover, high-risk pools charged people about twice as much as typical premiums, and most had lifetime maximums on how much they would pay for people’s care.
High-risk pools covered only 226,615 people in 2011—a mere fraction of the number of people with pre-existing conditions.
Premiums for coverage in state high-risk pools were typically 150%-200% of standard rates for healthy individuals.
Almost all state high-risk pools excluded coverage for pre-existing conditions for 6 to 12 months, making health coverage effectively useless during that period.
Nearly all state high-risk pools (33 out of 35) had lifetime dollar limits on coverage, most between $1 million-$2 million. 13 had annual dollar limits on coverage, which could cap people’s coverage to as low as $75,000 in care a year
High-risk pools were expensive for states: In 2011, states had to finance $1.2 billion in net losses to cover costs that exceeded money brought in through premiums. [Families USA, February 2017, via Media Matters, 2/16/17]
Kaiser Health News: High-Risk Pools “Sound Like A Good Idea” But Are “Very Hard To Make Work.” Kaiser Health News produced a video explaining that “high risk pools are another idea that sounds good” but are “very hard to make work in the real world of health care.” Citing the high-risk pools used in 35 states before the ACA’s implementation, the video noted that “none of them worked very well” because “premiums and other costs remained too high” and “the federal program ran out of money almost a year before it was scheduled to end.” The video emphasized that states “had to impose waiting lists for coverage” and many “risk pools set up waiting periods before they started paying bills for the very illness that made people high risk.” [Kaiser Health News, 10/31/16]
Mother Jones: High-Risk Pools “Are A Disaster” With “A Lousy History.” Mother Jones columnist Kevin Drum critiqued Speaker of the House Paul Ryan’s (R-WI) 2016 high-risk pools proposal, noting that “high-risk pools have a lousy history” and that “implementing them at the state level guarantees a race to the bottom, since no state wants to attract lots of sick people into its program.” Drum called high-risk pools “a disaster” and critiqued conservative framing of them “as some kind of bold, new, free-market alternative to Obamacare.” From the April 28 article:
It’s true that the cost of covering sick people raises the price of insurance for healthy people. That’s how insurance works. But there’s no magic here. It costs the same to treat sick people whether you do it through Obamacare or through a high-risk pool—and it doesn’t matter whether you fund it via taxes for Obamacare or taxes for something else. However, there are some differences:
Handling everyone through a single system is more efficient and more convenient.
High-risk pools have a lousy history. They just don’t work.
Implementing them at the state level guarantees a race to the bottom, since no state wants to attract lots of sick people into its program.
Ryan’s promise to fund high-risk pools is empty. He will never support the taxes it would take to do it properly, and he knows it.
This is just more hand waving. Everyone with even a passing knowledge of the health care business knows that high-risk pools are a disaster, but Republicans like Ryan keep pitching them anyway as some kind of bold, new, free-market alternative to Obamacare. They aren’t. They’ve been around forever and everyone knows they don’t work. [Mother Jones, 4/28/16, via Media Matters, 2/16/17]
The AHCA Includes Provisions To Put Per Capita Caps On And Block Grant Medicaid
Vox: The AHCA Will Allow States To Receive Medicaid Funding “In A ‘Block Grant.’” As Vox explained, the AHCA includes a provision that would allow states “to receive funding in a ‘block grant’ that doesn’t rise at all with enrollment.” From the March 21 article:
The “manager’s amendment” changing the legislation, which is set to be released Monday night by House leaders and expected to be adopted through a House Rules Committee vote before the full House votes on Thursday, includes new provisions cracking down on Medicaid beneficiaries. The changes would allow states to impose work requirements on able-bodied childless adults getting Medicaid, and to receive funding in a “block grant” that doesn’t rise at all with enrollment, which would likely amount to a still-larger cut. [Vox, 3/21/17]
MYTH: Block Granting Medicaid Would Increase State Flexibility And Innovation While Increasing Quality Of Care
National Review: “A Block Grant Would Empower Medicaid Enrollees To Make Their Own Decisions About What Kind Of Coverage They Need.” A National Review article claimed that “the block-grant scheme [for Medicaid] is gaining new traction as states face skyrocketing Medicaid costs.” The article asserted that “the basic idea of a Medicaid block grant is to give states maximum flexibility” and noted that it “would empower Medicaid enrollees to make their own decisions about what kind of coverage they feel they need.” From the October 7, 2015, article:
Among GOP candidates who have bothered to roll out Obamacare repeal-and-replace plans, a common theme has emerged: States should have more control over Medicaid, the joint federal-state health-care program for the poor, and that control should come in the form of a block grant.
The basic idea of a Medicaid block grant is to give states maximum flexibility in exchange for their accepting a fixed amount of funding from the federal government. It’s been around for decades, but the block-grant scheme is gaining new traction as states face skyrocketing Medicaid costs. Back when he was still in the race, Wisconsin governor Scott Walker proposed what was probably the most detailed block-grant plan for Medicaid to date. Florida senator Marco Rubio and Louisiana governor Bobby Jindal also have endorsed some form of a Medicaid block grant. If a Republican moves into the White House in 2017, a block grant will likely be on the new administration’s health-care agenda.
A block grant would empower Medicaid enrollees to make their own decisions about what kind of coverage they feel they need.
Under this scheme, enrollees would be responsible for any health-care costs beyond the premium subsidy, just like those purchasing subsidized coverage through the ACA exchanges. While out-of-pocket costs might be higher for some, private individual coverage would give Medicaid patients greater access to providers and therefore would likely produce better health outcomes. [National Review, 10/7/15, via Media Matters, 2/16/17]
Wash. Examiner’s Hadley Heath Manning: “Block Granting Medicaid Would Finally Allow States To Truly Innovate To Provide Better Quality Coverage.” Washington Examiner contributor Hadley Heath Manning advocated for converting federal Medicaid reimbursements into “block grants” to the states, claiming that it “would finally allow states to truly innovate to provide better quality coverage to those who are truly in need.” Manning alleged that currently, “Medicaid patients don’t have the health access or health outcomes that other patients do” and asserted that block grants “allow states more flexibility to make policies of their own.” From the January 31 article:
On NBC’s “Sunday Today,” President Trump adviser Kellyanne Conway said Medicaid block grants would be a part of a Republican replacement for Obamacare. Block grants have long been among conservative proposals to reform the government health insurance program for the poor.
If you can recall from your high school civics class, block grants are large sums of taxpayer dollars granted from the federal government to the states with very few strings attached (unlike categorical grants, which come with specific rules). Block grants, as opposed to a federal match, are fixed amounts indexed to grow each year along with inflation or other factors. These grants take away the incentive to spend more, but instead allow states more flexibility to make policies of their own about how they use that money and how the program will operate.
But Medicaid reform isn’t primarily about saving money. More important than any financial consideration is this: block granting Medicaid would finally allow states to truly innovate to provide better quality coverage to those who are truly in need. [The Washington Examiner, 1/31/17, via Media Matters, 2/16/17]
Families USA: “Block Granting Medicaid Is Just Another Way To Cut Medicaid.” A Families USA fact sheet denounced proposals to block-grant Medicaid, calling them “just another way to cut Medicaid.” It emphasized that block grants shift costs to the states and when costs go up, “states will get stuck with the extra bill, posing budget problems, stifling innovation, and likely leading to program cuts.” The fact sheet noted that “states already have significant flexibility to innovate within the Medicaid program” and “block grants would severely undermine Medicaid, boot people off the program, cut services, and hurt peoples’ (sic) health.” In particular, block-granting Medicaid “has serious consequences for women, as Medicaid provides essential care for women throughout their lives.” From the March 2017 fact sheet:
Block-grant Medicaid to the states — Block granting Medicaid is just another way to cut Medicaid. It is not a new or innovative idea.
Today, the amount of federal Medicaid dollars that a state receives is based on what it actually costs that state to provide health coverage to people with Medicaid. If costs go up—like when there is an epidemic, natural disaster, or economic downturn—states are guaranteed additional federal funds. With a block grant, states will get stuck with the extra bill, posing budget problems, stifling innovation, and likely leading to program cuts.
States already have significant flexibility to innovate within the Medicaid program in order to improve health care quality, and reduce costs. But there are certain basic services states must provide so no one falls through the cracks. Block grants would severely undermine Medicaid, boot people off the program, cut services, and hurt peoples’ (sic) health.
Cutting Medicaid has serious consequences for women, as Medicaid provides essential care for women throughout their lives—from family planning and maternal health services to nursing home care. Medicaid finances nearly half of all births in the U.S., accounts for 75% of all publicly-funded family planning services, and accounts for half (51%) of all long-term care spending, which is critical for many frail elderly women. [Families USA, March 2017, via Media Matters, 2/16/17]
CBPP: Block-Granting Medicaid Would “Threaten Benefits For Tens Of Millions Of Low-Income Families, Senior Citizens, And People With Disabilities.” Edwin Park of the Center on Budget and Policy Priorities (CBPP) denounced Medicaid block grant proposals, noting that they “would institute deep cuts to federal funding for state Medicaid programs and threaten benefits for tens of millions of low-income families, senior citizens, and people with disabilities.” Block grants “would institute deep cuts to federal funding for state Medicaid programs,” which, he said, would cause states “to make draconian cuts to eligibility, benefits, and provider payments.” He predicted states would “likely be able to begin charging significant premiums … at levels that research suggests would likely cause poor people to forgo coverage entirely or go without needed care.” Park noted studies of existing block grant proposals that indicate they would “lead states to drop between 14.3 million and 20.5 million people from Medicaid by the tenth year.” From the November 30 article:
A Medicaid block grant would institute deep cuts to federal funding for state Medicaid programs and threaten benefits for tens of millions of low-income families, senior citizens, and people with disabilities. To compensate for these severe funding cuts, states would likely have no choice but to institute draconian cuts to eligibility, benefits, and provider payments. To illustrate the likely magnitude of these cuts, an analysis from the Urban Institute of an earlier block grant proposal from Speaker Ryan found that between 14 and 21 million people would eventually lose their Medicaid coverage (on top of those losing coverage if policymakers repeal the ACA and its Medicaid expansion) and that already low provider payment rates would be reduced by more than 30 percent.
Such a block grant would push states to cut their Medicaid programs deeply. To compensate for the federal Medicaid funding cuts a block grant would institute, states would either have to contribute much more of their own funding or, as is far more likely, use the greater flexibility the block grant would give them to make draconian cuts to eligibility, benefits, and provider payments. For example, Speaker Ryan’s “Better Way” health plan would give states the choice of a block grant or a Medicaid per capita cap; both would appear to enable states to make sizeable cuts directly affecting beneficiaries that states can’t make now. This could include using waiting lists or capping enrollment; under current law, all eligible individuals who apply for Medicaid must be allowed to enroll. States also could be allowed to no longer provide children with a comprehensive pediatric benefit known as EPSDT (Early Periodic Screening, Diagnostic, and Treatment), under which children enrolled in Medicaid receive both regular check-ups and coverage for all medically necessary treatments that the check-ups find a child needs.
In addition, states could be permitted for the first time to impose a work requirement and terminate coverage for people deemed non-compliant. This could result in people with various serious barriers to employment — such as people with mental health or substance use disorders, people who have difficulty coping with basic tasks or have very limited education or skills, and people without access to child care or transportation — going without health coverage. States would also likely be able to begin charging significant premiums, deductibles, and co-payments at levels that research suggests would likely cause poor people to forgo coverage entirely or go without needed care. [Center on Budget and Policy Priorities, 11/30/16, via Media Matters, 2/16/17]
Political Scientist Ryan LaRochelle: “Turning Medicaid Into A Block Grant Would Result In Less Funding.” Ryan LaRochelle, a political scientist at Brandeis University, wrote in the Washington Post that “turning Medicaid into a block grant would result in less funding” for recipients. He pointed to “historical data [that] suggest that a shift to block grants would result in a gradual decline in Medicaid funding” because among 13 major block grant programs, “funding for all but one has shrunk.” Block grants also reduce funding because “the policies don’t get regular tuneups.” LaRochelle also pointed to other research on block grants, which found “no empirical evidence that the shift to block grants reduced total administrative costs” despite claims to the contrary. From the January 18 article:
1. Data shows that the move to block grants leads to less funding over time.
Historical data suggest that a shift to block grants would result in a gradual decline in Medicaid funding. A 2016 report by the Center on Budget and Policy Priorities (CBPP) showed that when the federal government uses block grants, the funding for the programs shrinks over time:
[O]ur analysis of the 13 major housing, health, and social services block grant programs that policymakers have created in recent decades shows that funding for all but one has shrunk in inflation-adjusted terms since their inception, in some cases dramatically. …
Overall funding for the 13 block grants has fallen by 37 percent since 2000, adjusted for inflation and population growth.
2. Reformers argue that block grants need less funding because they reduce costs. But they don’t.
When reformers propose switching a program to a block grant, they increasingly ask to have the funding reduced at the same time.
That’s the approach with Medicaid, as well. Trump’s health-care reform website claims that under a Medicaid block grant, “States will have the incentives to seek out and eliminate fraud, waste and abuse to preserve our precious resources.”
Public administration scholar Carl Stenberg’s analysis of block grants, however, found no empirical evidence that the shift to block grants reduced total administrative costs. Rather, these costs are passed from the federal government to the states.
3. Block granting leads to drops in funding because the policies don’t get regular tuneups.
Cornell political scientist Suzanne Mettler’s research shows that just like cars and houses, policies need periodic upkeep to remain effective. Legislators can maintain policies by reauthorizing them to guarantee funding streams, adjusting them for inflation,
and periodically reassessing and reforming them.
But legislators often don’t maintain existing policies, leaving them to fall into disrepair. That neglect is not unique to block grants. But certain features of block grants make them particularly susceptible to deferred maintenance and policy drift. Block grants typically do not keep pace with inflation, population changes, rising poverty rates or increased housing costs. [Washington Post, 1/18/17, via Media Matters, 2/16/17]
NY Times’ Robert Draper: Block-Granting Medicaid Will Leave “Millions Of People” Without Health Insurance. As The New York Times’ Robert Draper explained on MSNBC’s Morning Joe, “it’s well understood that block granting is going to leave a lot of people out, millions of people out” of the insurance market. From the February 16 edition of MSNBC’s Morning Joe:
ROBERT DRAPER: All of these Republican proposals basically block grant Medicaid to the states. But some of the governors, Republican governors who have embraced Medicaid expansion do not want to see this thrown away. And it’s axiomatic, it’s well understood that block granting is going to leave a lot of people out, millions of people out. I’m not sure President Trump wants to read headlines in the newspapers about how millions of people under Trumpcare are now on the street without coverage.
WILLIE GEIST: Is it fair to say what’s sort of become gospel, which is that the Republicans have voted to repeal all or part of the Affordable Care Act more than 60 times, I don’t know what the number is any more, but have never had a plan ready to replace it? That’s always been the argument. Have they had a plan at any of those points?
DRAPER: They have had plans here and there, but they haven’t coalesced around any of those plans. One of those plans was put together by then-Republican Study Committee Chairman Tom Price, who’s now the head of HHS. Paul Ryan again has had a plan of his own. But most of these have been piecemeal. And I think the most significant thing, Willie, is that Obamacare, for all of its flaws, has changed the paradigm. Now there are millions of more people on the rolls and there’s no guarantee that any of these other plans will keep those same people on the rolls.
JOE SCARBOROUGH (CO-HOST): And Tina, as I underline all the time, millions of people on Obamacare, and many of them Trump supporters.
TINA BROWN: Many of them are Trump supporters. They have embraced it. They are now getting coverage. They are now able to have pre-existing conditions covered. There is just no way — it really is a scandal to me, an absolute scandal, that the Republicans that have made this their war cry for six years, and, yet, they have not been ready to come something. And in a way, this is exactly the kind of issue that Trump is never going to be bothered with because he hates detail. It’s not something he can solve with, quote, a deal, which is really the only prism through which he sees political action. [MSNBC, Morning Joe, 2/16/17]
The AHCA Will Allow States To Require Able-Bodied Medicaid Recipients To Work For Insurance
NPR: AHCA Would Let Governors “Require People To Work To Qualify For Health Insurance Under Medicaid.” As NPR explained, one provision of the AHCA “would let state governors require people to work to qualify for health insurance under Medicaid.” From the March 21 article:
A key change, designed to help attract votes from conservative Republicans, would let state governors require people to work to qualify for health insurance under Medicaid.
“The work requirements are important,” Health and Human Services Secretary Tom Price said Sunday on ABC News. “They are something that is restorative to people’s self-worth, sense of themselves.” [NPR, 3/21/17]
MYTH: Without Work Requirements, Medicaid “Operates As A Welfare Trap”
Wash. Examiner Op-Ed: Without Work Requirements, Medicaid “Essentially Operates As A Welfare Trap.” In an op-ed for the Washington Examiner, Josh Archambault claimed that without work requirements, Medicaid “essentially operates as a welfare trap as enrollees have to maintain a low-income to stay enrolled.” Archambault urged Congress to “put work requirements in place for all non-disabled, working-age adults on Medicaid.” From the March 137 op-ed:
Currently, states are generally prohibited from imposing work requirements on any non-disabled adult in Medicaid. Without these requirements in place, the program essentially operates as a welfare trap as enrollees have to maintain a low-income to stay enrolled.
Numerous states have expressed an interest in work requirements including expansion states (Arizona, Arkansas, Kentucky) and non-expansion states (Maine, Wisconsin) alike.
Congress should put work requirements in place for all non-disabled, working-age adults on Medicaid. Medicaid work requirements have strong bipartisan support with voters and similar work requirements have proven incredibly successful for welfare cash assistance programs and for certain populations on food stamps. It is time to extend them to Medicaid. [Washington Examiner, 3/13/17]
CBPP: “A Medicaid Work Requirement Would Block Poor Families From Care.” CBPP’s Hannah Katch denounced the proposal to “radically restructure Medicaid,” noting that “a work requirement in Medicaid would penalize those least able to get and hold a job – while keeping others from improving their health.” She explained that in contrast to conservative claims, “a work requirement would likely reduce the number of people who could access care through Medicaid and there’s no evidence that it would increase employment among poor families.” Additionally, Katch emphasized that work requirements are unnecessary because “most people on Medicaid who can work do so, and for people who face major obstacles to employment, work requirements won’t help to overcome them.” From the February 28 article:
With congressional Republicans considering proposals to radically restructure Medicaid, some Republican governors are proposing their own sweeping changes to the program, including imposing work requirements on beneficiaries. But as we’ve written, a work requirement in Medicaid would penalize those least able to get and hold a job — while keeping others from improving their health and participating in the workforce.
Many adults on Medicaid are disabled or are caring for a family member. Many others have low-wage jobs that don’t offer health coverage. For those who can work, Medicaid can help them keep their job or search for work. Three-quarters of beneficiaries in Ohio who received care under the Affordable Care Act’s (ACA) Medicaid expansion and who were looking for work reported that Medicaid made it easier to do so. For those who were currently working, more than half said that Medicaid made it easier to keep their jobs.
A work requirement would likely reduce the number of people who could access care through Medicaid and there’s no evidence that it would increase employment among poor families.
Moreover, most people on Medicaid who can work do so, and for people who face major obstacles to employment, work requirements won’t help to overcome them. A recent New York Times article on the work requirement proposals quotes Jimmy Brunson, a 44-year-old with diabetes and painful neuropathy in his feet who has health coverage through the ACA’s Medicaid expansion. “Even though sometimes I can get a job, you’ve got to understand, sometimes I can’t even walk,” he told the Times. If he had to work in order to keep his coverage, he says he would “probably be out.” [Center on Budget and Policy Priorities, 2/28/17]
Families USA: A Work Requirement For Medicaid “May Actually Increase Poverty.” According to a Families USA report, a work requirement for Medicaid is “unnecessary and counterproductive.” The report explained that the policy “may actually increase poverty among many.” Additionally, “It would increase the number of uninsured and add administrative complexity, which would increase costs for states and the federal government.” From the March 2017 report:
A work requirement in Medicaid is not only a bad idea, it’s unnecessary and counterproductive.
It would not help move low-income people out of poverty and may actually increase poverty among many. It would increase the number of uninsured and add administrative complexity, which would increase costs for states and the federal government. [Families USA, March 2017]
The AHCA Defunds Planned Parenthood
Time Magazine: The AHCA “Includes A Provision To Defund Planned Parenthood.” As Time magazine noted, the AHCA “includes a provision to defund Planned Parenthood, the largest network provider of women’s health care in the country.” [Time magazine, 3/6/17]
MYTH: Planned Parenthood Isn’t An Essential Provider And Other Clinics Can Fill In The Gaps
Fox Host Sean Hannity And Then-Breitbart Reporter Michelle Fields Pushed Claim That There Are “Plenty Of Other Places Where People Can Get Better Services” Without Planned Parenthood. In November 2015, Fox News’ Sean Hannity claimed that there are already numerous health centers capable of replacing Planned Parenthood. During the segment, Michelle Fields, who at the time was a political reporter for Breitbart News, argued that defunding Planned Parenthood is “fiscally responsible” because there are “plenty of other places where people can get better services.” Hannity said funding these centers instead of Planned Parenthood “seems like a winnable issue” because the funding would “continue to be spent on women’s health issues, but not through Planned Parenthood.” From the November 11, 2015, edition of Fox News’ Hannity:
SEAN HANNITY (HOST): We can’t seem to get Republican candidates and Republican elected officials to take a simple stand. Continue to fund women’s health issues but not Planned Parenthood. That seems like a winnable issue to me.
MICHELLE FIELDS: Absolutely. And, you know, it’s a fiscal issue. You’re being fiscally responsible. Planned Parenthood can be self-sufficient. It does not need taxpayer dollars. Plus, there are plenty of clinics, plenty of other places where people can get better services, better quality of service without taxpayer dollars. So this should be an issue everyone should be talking about.
HANNITY: The money will continued to be spent on women’s health issues, but not through Planned Parenthood. That to me seems legitimate considering they’re on tape breaking the law. [Fox News, Hannity, 11/11/15, via Media Matters, 10/17/16]
Public Health Professor: Argument That Community Health Care Centers “Can Absorb The Loss Of Planned Parenthood Clinics Amounts To A Gross Misrepresentation.” Experts have confirmed that even when community clinics do provide reproductive health services, they are not well-positioned to fill the gap that would be left if Planned Parenthood were defunded. Sara Rosenbaum, a professor at the George Washington University Milken Institute School of Public Health, wrote in an article for Health Affairs that the “claim that community health centers readily can absorb the loss of Planned Parenthood clinics amounts to a gross misrepresentation of what even the best community health centers in the country would be able to do”:
I have worked with community health centers for nearly 40 years, and no one believes more strongly than I do in their ability to transform the primary health care landscape in medically underserved low-income communities. But a claim that community health centers readily can absorb the loss of Planned Parenthood clinics amounts to a gross misrepresentation of what even the best community health centers in the country would be able to do were Planned Parenthood to lose over 40 percent of its operating revenues overnight as the result of a ban on federal funding.
It is important to set the record straight about what it would mean to women were health centers suddenly to have to respond to a hole in care of this magnitude, especially given absurd claims about their financial ability to do so, such as assertions that community health centers could do so for $1.67 per patient. Community health centers are extremely efficient, but the cost of caring for their patients averages about $600 per person annually.
While community health centers constitute a vital component of the nation’s primary care safety net, three reasons underscore why it’s misguided to suggest community health centers could–overnight–compensate for the loss of affordable women’s health services at Planned Parenthood clinics. [Health Affairs, 9/2/15, via Media Matters, 3/7/17]
Guttmacher Institute: In 103 U.S. Counties, Planned Parenthood Is The Only “Safety-Net Health Center” With Accessible Contraception Services. In 2015, the Guttmacher Institute responded to a request from the Congressional Budget Office about the “geographic service availability from Planned Parenthood health centers.” Its report noted that in 103 U.S. counties, Planned Parenthood is the only “safety-net health center” able to provide publicly subsidized contraceptive services and that Planned Parenthood typically saw patients three to five days sooner than “other types of safety-net providers.” From the Guttmacher Institute (citations removed):
In 18 states, Planned Parenthood health centers serve more than 40% of women obtaining contraceptive care from a safety-net family planning health center.
In 11 of those 18 states, Planned Parenthood serves more than half the women obtaining contraceptive care from a safety-net health center.
In 103 counties with a Planned Parenthood health center (21% of counties with a Planned Parenthood site), Planned Parenthood serves all of the women obtaining publicly supported contraceptive services from a safety-net health center. [Guttmacher Institute, 8/14/15, via Media Matters, 3/7/17]
NY Times Editorial Board: Planned Parenthood Serves More Patients And Has “Higher Quality Care Than Centers Without An Emphasis On Reproductive Health.” In an editorial, The New York Times refuted the argument that “community health centers can easily provide the same family planning services that Planned Parenthood offers.” The Times pointed to a recent study which found that Planned Parenthood was able to offer “a wider range of family planning services and higher quality care than centers without an emphasis on reproductive health.” From the September 9 editorial:
Some state lawmakers have argued that community health centers can easily provide the same family planning services that Planned Parenthood offers. But a study published this year found that providers focused on reproductive health care, like Planned Parenthood, offered a wider range of family planning services and higher quality care than centers without an emphasis on reproductive health.
The AHCA Is A Giant Tax Break For The Wealthy That Would Drastically Increase The Number Of People Uninsured
Politico: The AHCA “Would Cut Taxes On The Wealthy By Hundreds Of Billions Of Dollars.” According to Politico, the AHCA “would cut taxes on the wealthy by hundreds of billions of dollars” and would cost “more than $300 billion over a decade” due to lost revenue. Politico cited the Tax Policy Center, writing that the tax cuts “would save the top 0.1 percent of earners about $195,000 annually.” From the March 6 article:
House Republicans’ Obamacare replacement plan would cut taxes on the wealthy by hundreds of billions of dollars.
Their long-awaited proposal, unveiled Monday evening, would among other things kill a 3.8 percent investment tax on the well-to-do that Democrats had used to help finance the health care law, as well as a 0.9 percent surcharge on wages above $250,000.
Lawmakers did not immediately provide a cost estimate, but budget forecasters have previously estimated that nixing the two taxes would cost more than $300 billion over a decade.
The move would save the top 0.1 percent of earners about $195,000 annually, according to the Tax Policy Center. [Politico, 3/6/17]
Wash. Post: Under The AHCA, “24 Million Fewer People Would Have Coverage A Decade From Now.” The Washington Post reported that the Congressional Budget Office (CBO) found that under the AHCA, “24 million fewer people would have coverage a decade from now than if the Affordable Care Act remains intact, nearly doubling the share of Americans who are uninsured from 10 percent to 19 percent.” Additionally, “The office projects the number of uninsured people would jump 14 million after the first year.” From the March 13 article:
The analysis, released late Monday afternoon by the Congressional Budget Office, predicts that 24 million fewer people would have coverage a decade from now than if the Affordable Care Act remains intact, nearly doubling the share of Americans who are uninsured from 10 percent to 19 percent. The office projects the number of uninsured people would jump 14 million after the first year.
The analysis predicts that the number of people without health coverage would rise to 52 million by 2026, compared with 28 million if the Affordable Care Act remains intact. That erosion would mean that about 1 in 5 U.S. residents would be uninsured by 2026 — compared to 1 in 10 uninsured now and 1 in 6 who were uninsured before the Affordable Care Act was enacted.
The reduction in the number of insured people would result from three factors. A provision rescinding the penalty imposed on the uninsured could prompt many Americans to drop their health plans. After that, tax credits that are less generous than current subsidies could make insurance unaffordable to more people. Finally, some states may undo the expansion of their Medicaid programs. [The Washington Post, 3/13/17]
Graphic by Sarah Wasko