Meet the Senate health care bill. Like Obamacare, only flimsier
After months of secrecy and speculation, Senate Republicans on Thursday morning finally shared details of their health care bill with the world. And it turns out, not all that much got changed in the dark.
The Senate bill retains the basic structure of President Obama’s signature health care law, which most of us call Obamacare. Except that all the parts have been whittled down and weakened, leaving skimpier subsidies for lower-income Americans, a weaker mandate for individuals to buy insurance, and fewer consumer protections.
Cuts to Medicaid reach far deeper than anything envisioned by House Republicans. Not only would federal funding be capped under the Senate bill, but the cap is deliberately designed to get tighter every year, even if health care costs are rising unusually quickly.
In a compensatory effort to make health care more affordable for those who lose access to Medicaid or federal subsidies, Senate Republicans would give states the option to loosen some regulations, allowing them to offer cheaper — albeit less comprehensive — plans.
But looking across these various proposals, there doesn’t seem to be a defining policy rationale. Senate GOP leaders didn’t produce the kinder, gentler bill that many people concerned about the stern House version were hoping for. Nor did they attempt a wholesale rewriting of health policy around free-market principles or radical state-by-state experimentation.
Instead, senators have taken a half-a-loaf approach to everything, paring back elements of Obamacare without actually eliminating them.
The one exception has more to do with taxes than health care. Under the Senate plan, reduced spending on health care serves a clear budgetary purpose: making room for big tax cuts, chiefly to the benefit of America’s wealthiest businesses and individuals.
Here’s a rundown of the key changes in the Senate bill.
M edicaid expansion becomes Medicaid contraction. Obamacare gave states money to expand Medicaid, which helped millions of low-income Americans get insurance. But that effort would be rolled back and eventually eliminated by the Senate bill.
And that’s just stage one of Medicaid cuts. Moving forward, the federal government would stop reimbursing states based on actual spending. Instead, states would choose to receive either a lump sum or a per-person credit.
Trouble is, those payments would almost certainly fail to keep up with need — not just for the poor but other key Medicaid groups, including elderly people in need of nursing care and those with disabilities.
In fact, the Senate bill provides even less long-term Medicaid funding than the House bill — which was estimated to cut 14 million people from the Medicaid rolls. That’s because senators want federal support to rise alongside the general inflation rate, as opposed to the inflation rate for medical care — which is generally higher.
Even wealthy states like Massachusetts would struggle to make up for the lost dollars, and we have long relied on that money to maintain our best-in-the-nation insurance coverage rate.
Smaller subsidies. This might be the most fundamental difference between the House and Senate bills. The House wanted to end the need-based support provided by Obamacare, switching instead to a formula where subsidies depend on age. But the Senate dropped the change and went with the old framework.
Except the Senate proposal provides far less money than the current Obamacare arrangement. Among other things, it sets the subsidies based on the cost of less-expensive (and less-generous) plans than Obamacare did. Also, it eliminates support for those earning between 350 and 400 percent of the poverty line — and reduces support for many Americans just below those income levels.
The Senate plan also makes subsidies available to those living below the poverty line — many of whom are currently eligible for Medicaid. That might be a recognition of how deep the Medicaid cuts will penetrate, but in general families in this group earn less than approximately $25,000 a year, so they tend to need more comprehensive support (not just with premiums but also out-of-pocket costs).
Don’t like the rules? Opt out. Under the Senate bill, states would have a lot of latitude to waive restrictions and loosen their local insurance markets.
They could, for instance, let insurers eliminate certain types of coverage, for, say, maternity care or mental health. That would lower premiums — less coverage, less cost
Missing from the Senate bill is the House’s change to rules on preexisting conditions that would let states decide whether insurers should be able to charge more for people with higher health risks — temporarily, and only for people who fail to maintain continuous coverage. The Congressional Budget Office concluded that this would destabilize insurance markets in whole swaths of the country, and for now it’s not in the Senate bill.
Defund Planned Parenthood. Despite warnings that defunding Planned Parenthood would create an unnecessary political hurdle, it’s still officially part of the plan. Medicaid recipients would be prevented from accessing health care at Planned Parenthood clinics for one year, which would not only deprive the organization of vital funds, it would also make it harder for millions of women to get essential reproductive care.
The Senate has also adopted a House proposal that would ban people who get federal subsidies from purchasing insurance plans that include abortion coverage.
Goodbye, individual mandate — for real this time. Unlike the House, which swapped the individual mandate for a requirement that all people maintain continuous coverage, the Senate bill does away with it entirely.
That’s generally considered destabilizing because it means healthy people can stay uninsured until they get sick, which ends up raising the cost of insurance for everywhere who needs it. The Senate bill compensates with a special pool of money for insurers, but we’ll have to wait for the CBO to get a sense of the likely effect.
Whether this mix of policies is the right fit for the Senate is still anyone’s guess. Some conservative senators seem to think it’s too moderate; some moderates fear it’s too conservative. And the Planned Parenthood provision is a wild card concern that has drawn criticism in the past from two female Republican senators.
But a lot can still change, and the horse-trading has barely begun. In the days ahead, you can expect to see all manner of rewrites designed to win key votes and get this bill through the chamber.
Still, there isn’t a lot of room for error. Republicans control 52 Senate seats, and they need 50 votes (including a tie-breaker from Vice President Mike Pence). If just three members balk, the bill is dead.
Temporarily dead, anyway. Remember, the House bill died, too, only to be resurrected in triumph some weeks later. Even if Republicans can’t find 50 votes for this bill before their summer recess, that doesn’t mean the game is over. They’ve been promising to repeal Obamacare for years; why should they give up in a matter of months?