The American Health Care Act’s demise is a car-wreck for House Speaker Paul Ryan and President Trump. President Trump promised to deliver a health care plan that expanded coverage to everybody. Instead, the Republican plan ripped it away from 24 million people.
Republicans are correct to say health insurance is still out of reach despite the passage of Obamacare. But they, and only they, can fix its glaring coverage gaps.
Millions of Americans cannot afford health insurance because Republicans have not cooperated with Democrats to fully implement and fix the law. Obamacare expanded Medicaid, a half century old means-tested public insurance program, to many more people. Republicans should pressure every governor to expand Medicaid eligibility. Furthermore, congressional Republicans should support legislation to close the ‘family glitch’, a coverage gap that makes private health insurance unaffordable for low-income families.
The Affordable Care Act expanded Medicaid eligibility to low-income adults earning less than 138 percent of the federal poverty line. In 2012 the U.S. Supreme Court ruled this provision as optional for states to comply. In 2020, states will have to kick in 10 percent of the costs to expand Medicaid. Until then, the federal government picks up the entire tab.
Nineteen states currently opt not to expand Medicaid eligibility. Too many of America’s home health aides, line cooks, waiters, and sales clerks are stuck in a rut. Because of partisan politics and anti-Obama sentiment, 2.6 million adults in predominately Republican-led states can’t afford health care because they earn too much to qualify for traditional Medicaid but not enough to obtain income-based tax subsidies Obamacare provides for individuals to buy a health plan off Obamacare’s state-run marketplace. These patients don’t get coverage through work.
Governors are playing politics with the working poor's health. Worse, they are denying health benefits to millions of Medicaid eligible African American and Latino families living in the Deep South. Patients of color reel from poor health outcomes like higher rates of heart disease and infant mortality because of meager health insurance access.
Families currently in this Medicaid coverage gap cannot afford private coverage. It’s too burdensome. The Kaiser Family Foundation found that in 2016 the national average unsubsidized premium for a 40-year-old non-smoking individual buying coverage through the Obamacare Marketplace was between $250-$300 monthly for a basic health plan. That’s more than half of income for those at the lower income range of people in this gap and about a quarter of income for those at the higher income range of people in the gap. If poor people have to decide between insurance and goods like shelter, they understandably choose shelter and food. Uninsurance persists.
Republicans, a party that claims to celebrate economic growth, would be smart to expand Medicaid because of its economic benefits. The Robert Wood Johnson Foundation surveyed 11 states like California, Michigan and Kentucky and found that expansion resulted in less state spending for uninsured populations, more job growth, and reduced hospital uncompensated care costs for uninsured patients. Expanding Medicaid gives more workers access to comprehensive health insurance, a better chance to stay healthy and be productive.
Congressional Republicans can immediately close another coverage gap, ‘the family glitch’ affecting 2.3 million low-income families. Under Obamacare if one family member has job-based insurance that’s deemed affordable by the government - costing less than 9.56 percent of the family’s income - then every member of that family is not eligible to qualify for government subsidies to help pay for insurance off Obamacare marketplace. The Internal Revenue Service’s (IRS) interpretation of an insurance subsidy eligibility can ignore the cost of insuring an entire family, which is much more expensive than individual-only coverage.
More than six million people are ineligible for subsidies because of the family glitch. Such families can face health plan premiums 1 6 percent of household income, 12 percent after factoring in tax advantages of obtaining health coverage on the job.
Republicans can re-introduce and support the Family Coverage Act, introduced by Sen. Al Franken (D-MN), to ensure all families have access to affordable coverage. The bill would amend the Internal Revenue Code to determine Obamacare subsidy eligibility based on the cost of family coverage and not of a worker in that family.
To be sure, there’s more to be done to address working families’ health care woes. The Affordable Care Act’s implementation is riddled with problems related to underinsurance. People are facing unaffordable monthly premiums, deductibles, copays, and provider out-of-network out-of-pocket costs. The Obamacare marketplaces are working well in many parts of the country yet not in others. Patients still can’t buy quality health insurance at a reasonable monthly price.
Obamacare’s problems are complex, requiring cooperation from both parties in Washington to offer solutions. Indeed, with the collapse of the American Health Care Act, America can scrap its multi-payer inefficient health system and join the rest of the industrialized world to fully embrace universal health care, a single-payer Medicare-for-All system that shrinks the size of for-profit health insurance and guarantees health care a right for all.
Despite President Trump’s recent revelations of American health care being complicated, it's not difficult for Republicans to figure out what to do now that their health agenda failed. Republicans should lick their wounds and help the people that sent them to office get better health coverage. The Republican plan didn’t do that. With new approaches to America-first leadership, Republicans can make sure Obamacare’s unaffordability and coverage gaps close for good.