Email #153: “a pittance”?

If the American Health Care Act passes in the Senate as it did by two votes in the House last week and then is signed into law by President Trump, I hope it is an unqualified success, bringing affordable health care to millions of Americans.

But I am confused how that would happen.

If you’re healthy, you end up in a low-risk pool, and if you’re sick you end up in a high-risk pool. In past years, the 50% healthiest Americans account for only 1/33rd of health care costs nationwide, while the 10% sickest Americans account for almost 2/3rds. That means high-risk pools will be extraordinarily expensive. How will the AHCA make health care affordable for these neediest Americans?

It sets aside funds to subsidize its high-risk pools. The bill only passed after the Upton amendment added $8 billion to the previous version. But the Mercatus Center, which vigorously supports repealing Obama’s Affordable Care Act, calls that extra $8 billion “a pittance.” An expert at the Brookings Institution’s Center for Health Policy called it “a drop in the bucket.”

They know because 35 states have already tried high-risks pools on a small scale. Together those states were insuring 226,615 people in 2011. Their patients averaged medical bills of $5,510 per person and $2.6 billion combined. While the patients paid premiums double those of people not in high-risk pools, state taxpayers covered almost half of their bills, for a total of $1.2 billion. So what happens when the AHCA’s high-risk pools grow much much larger?

Colorado’s high-risk pool only included 14,000 people. If the ACA is repealed, that number could rise to 753,000. Even if all of the stability funds go to subsidize high-risk pools, the health care consulting firm Alavere estimates that money will cover only 600,000 people. That’s only a little more than a quarter of the 2.2 million who are likely to be forced into the high-risk pools.

According to the bipartisan Kaiser Family Foundation: “Even under pretty conservative estimates, a minimally adequate high-risk pool could cost $25 billion per year nationwide.” The Center for American Progress estimates $32.7 billion. In both scenarios, the AHCA’s funds run dry. So then what happens to all of those people? Even if the AHCA works as hoped, they are forced to pay premiums twice those of other Americans. And if the AHCA fails, they lose their health care entirely.

Why did you vote for a plan that puts at risk the people who most need it?

Author: Chris Gavaler

Chris Gavaler is an assistant professor of English at Washington and Lee University where he teaches creative writing, contemporary fiction, and comics. He has published two novels, Pretend I'm Not Here (HarperCollins 2002) and School For Tricksters (Southern Methodist University 2011), and two nonfictions, On the Origin of Superheroes (Iowa University 2015) and Superhero Comics (Bloomsbury forthcoming 2017).

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