Donald Trump and the Republicans have vowed to repeal and replace the Affordable Care Act and it is very likely they will follow through. If they repeal the ACA and do not replace it with something comparable or better, as many as 25 million people could be without insurance by 2020. Additionally, many if not most people may have less comprehensive coverage and higher co-pays, but that all depends on what kind of replacement plan the congress approves if any. And that — is only the tip of this ugly iceberg.
This blog only deals with repeal while the House has approved a replacement bill, the U.S. Senate has not. We will cover that as thoroughly as possible when it happens.
Few remember this, but just before ACA passed in 2010 the health insurance companies hiked their rates significantly. Since then they have raised rates several more times. Let’s be clear here, ACA is NOT raising your rates, there is no provision in the act that allows for that. Many have complained that ACA is responsible for increased rates, but that’s really an empty claim because we don’t know what insurance rates would have done if there was no ACA. One thing for sure, rate hikes always come from the Insurance companies. If ACA is repealed you will get far less coverage, but you can be sure the insurance companies don’t reduce their rates by a single dime.
If ACA is repealed everyone will feel it, even the very wealthy. The difference is they can afford to self-insure– maybe. Today the cost of some procedures and care is so high that it might even hurt the mega rich to have to pay out-of-pocket. 10 years ago I had a heart transplant. According to the National Transplant Foundation, the average cost today for the same procedure would be $1.2 million. That price includes first-year medications and care. You can review other costs here. (http://www.transplants.org/faq/how-much-does-transplant-cost). A heart/lung transplant would cost $2.3 million. That would make even a wealthy person sit up and take notice. (If you would like to examine the effect of ACA on health care costs Gary Cameron of the Reuters news service.wrote this for Time.http://time.com/money/4503325/obama-health-care-costs-obamacare/ )
The Trump administration is also talking about cuts to both Medicare and Medicaid. It remains to be seen what that means but this congress is in a cutting mood, so it is unlikely that their actions will result in anything beneficial to many with chronic illnesses. You can also expect that if there was ever any hope of extending coverage for anti-rejection drugs past 36 months for Kidney transplant patients it ended with Trump’s Inauguration.
Very few people are aware that Medicare is also affected by repeal of Obamacare. There are several areas that will be negatively impacted but the part that helps seniors with Prescription costs will take the biggest hit.
The Senate bill slashes tax revenues by $701 billion over a decade, while reducing Medicaid spending by $772 billion versus current law. Overall, the Senate bill reduces federal health care spending by $1 trillion.
The Center for Budget and Policy Priorities estimates the bill’s tax benefits for the 400 highest earning households in America alone are equal to the cost of keeping Obamacare’s Medicaid expansion in four states that cover 726,000 people.
- The ACA helps seniors in the donut hole until it is closed. Copayments required for brand-name and generic drugs are being phased down to the standard 25 percent by 2020. Brand-name drugs discounts from manufacturers increase each year in the coverage gap. Copayments for generic drugs are reduced by seven percentage points each year until the coverage gap is eliminated.
- In 2016, seniors receive a 55 percent discount on brand-name prescription drugs and a 42 percent discount on generic drugs, which is applied at the pharmacy. Below are the amounts that beneficiaries will pay for their medications until the donut hole is closed in 2020.
- 2016: 45 percent for brand-names and 58 percent for generics
- 2017: 40 percent for brand-names and 51 percent for generics
- 2018: 35 percent for brand-names and 44 percent for generics
- 2019: 30 percent for brand-names and 37 percent for generics
- 2020: 25 percent for brand-names and 25 percent for generics
Ever since the Affordable Care Act (ACA) passed in 2010, Republicans have vowed to repeal it. They have made many claims about what a “Disaster” it is, but offer little in the way of evidence other than point to increased premiums. Premiums, though, were out of control long before there was an ACA and many experts say that if anything the sweeping health care bill slowed their increase. If Republicans are successful in repealing the act you will be affected in many ways, now and in the future. I’d like to keep this blog relatively short so I will only address four issues here, but they are big ones.
- Pre-existing conditions
- Children on your policy until age 26
- Medicaid changes
- Medicare adjustments
Effect Number One. Pre-existing Conditions
People have short memories so let me remind you what the health insurance environment was like prior to 2010. Example. A woman I know was having problems sleeping,, that’s all. She was in otherwise excellent health. To help her sleep, her doctor prescribed Remeron which is also an anti-depressant. Due to family circumstances, she had to move to a different state, a state in which her current health insurance had no coverage. She thought nothing of it because she was healthy, so she shopped around for new insurance, found one she liked and applied. Almost immediately she was denied coverage due to a pre-existing condition of depression even though she was not suffering from depression. The drug, Remeron, was prescribed to help her sleep but the new insurance company ignored that detail. Her only option was to keep her old insurance from another state even though she was out of network. Under those circumstances, this healthy woman had become uninsurable because of one medication that was not even prescribed for the purpose identified in the rejection notice. That is what we likely will be returning to. But there’s more.
If the ACA is repealed without a replacement plan and maybe even with one here’s what you can expect.
Let’s say a young couple finds they are about to have a child. The husband just got a new job in another state so they will have to move and get new insurance as well. Here’s what they are likely to run into if ACA is repealed.
- Pregnancy could easily be considered a pre-existing condition, at least the insurance companies would have that option. That means when this family looks for new coverage insurers could deny it or charge exorbitant rates.
- Even if they got insurance, the plan would likely not include maternity coverage, as was the case for over 60 percent of enrollees in individual market plans in 2011.
- They’d get no financial assistance to help ensure they can find a good plan within their budget and there would be no help in paying their out-of-pocket costs.
- Healthy pregnancy, births, and newborns programs would no longer exist, putting the family at greater risk for other health problems.
- And the family would likely have to pay out of pocket for each new baby visit and any ensuing treatments, injections or other procedures.
Some estimates indicate that nearly a half of all Americans have a pre-existing medical condition that could make it difficult to find insurance, and about 3 million of them are now insured under the ACA. If and when it is repealed those who have insurance could lose it and those without insurance, or who leave their old plans for any reason such as job change, divorce, or relocation, may find it impossible to get a new plan. The Kaiser Family Foundation projects that if the pre-existing conditions provision is repealed, 52 million Americans could be at risk of being denied health care coverage.
Effect Number Two. Children Covered by Parent’s Insurance to Age 26
If ACA is repealed and not replaced with something equivalent or better, that means that once you turn 19 or are no longer a full-time student, you are on your own for insurance coverage, increasing the financial burden on young adults who are unemployed, underemployed, contractors, working for small companies, or those starting their own businesses. Young people are less likely to get seriously ill and often don’t use insurance when they have it. Insurance companies would love to have these men and women paying premiums again, though, because they use so little of the coverage and help to defray the cost of covering others.
This is a popular benefit among some Republican office holders because their children are affected so it might be added to whatever replacement the GOP drafts, although the age limit could potentially get lowered by a year or two.
Effect Number Three. Medicaid
One of the most appealing aspects of health-care reform for many was the ability to get subsidized insurance policies, reducing out-of-pocket costs. According to Kaiser Health News, all but 19 states expanded the income limits for people to get Medicaid insurance and in some cases limits were pushed to 300 percent of the federal poverty level. Also, tax credits beyond that helped even middle-class workers and families afford their monthly premiums. The Affordable Care Act was affordable largely because of the Government subsidies. While all Republicans in congress opposed the expansion of Medicaid, many Republican State Governors accepted the plan for their states. Medicaid is funded by the Feds but run by the states. If ACA is repealed and Medicaid expansion goes out the window the states will be left with the choice of funding it or telling their citizens that they are cutting the program. That could have disastrous effects for Republicans in coming elections.
Based on the resistance that red states had to the idea of expanding Medicaid coverage in the first place — even with the federal government covering almost all of the expense — it will not be surprising to see a GOP plan that either decreases or completely remove the tax credits or other subsidies. Almost all Republicans agree it must go. There seems to be little agreement on if or how to replace it.
Effect Number Four. Medicare Cuts
Here comes trouble. Like Social Security this is the healthcare third rail, it can mean political suicide for anyone that makes any negative changes in the national health care system for people age 65 and over. The great majority of them are not working, have no income other than Social Security and some savings and they are uninsurable outside of Medicare (supplemental programs excepted). Some see Medicare as totally separate from the ACA and in some ways it is, but they are also intertwined. Too many seniors think they are immune from change, they are not.
According to the Kaiser Foundation, a full repeal of ACA would restore higher payments for services performed under the managed-care portion of Medicare known as Medicare Advantage. That, then, could lead to increased Medicare Advantage premiums. It could also mean an end to free preventive services and could result in greater premiums and increased out-of-pocket costs, or both.
Perhaps the most notable change would be to reverse efforts to close the “doughnut hole” for prescription drugs. One provision of the Affordable Care Act dramatically cut the amount that seniors on Medicare have to pay for their medicines under Medicare Part D. prior to the ACA’s passage, beneficiaries got some coverage up to a certain dollar amount, and then none until high-dollar, catastrophic coverage provisions kicked in. Once in that “donut hole” seniors paid the full price. Under ACA that coverage gap was supposed to end in 2020.
Now here’s what they are NOT telling you. It is now projected that ACA spending between now and 2020 is $1 trillion LOWER than the original Congressional Budget Office estimate. That means the trust fund for Medicare is now projected to remain solvent 11 years longer than before the Affordable Care Act was enacted. Strangely none of the repeal advocates has mentioned that fact.
For these reasons, it is important to be clear. The repeal of Obamacare will mean that Medicare beneficiaries will have to pay millions more for prescription drugs and won’t have access to free preventive care, while the program itself will be put in financial jeopardy.
As long as this blog is, it doesn’t begin to cover the full impact of ACA repeal and it says nothing about replacement because we have been unable to find a single plan for doing that that has been released. There are several people who say they have plans, but none have provided documents yet. We’ll keep our eye on it and do what we can to keep you informed. We’ll report more as we can.
Bob Aronson is the founder of Facebook’s 4300 member Organ Transplant Initiative and also of this site, Bob’s Newheart. Look through the index and you’ll find nearly 300 blogs of interest to Transplant patients, their families, friends, caregivers, donors and donor families.
Whether your agree with it or not, the Affordable Care Act, also known as “Obamacare” is one of the most significant pieces of legislation ever to pass the U.S. Congress. Some of it is already in effect but it will continue to unfold in years to come.
Politics aside, there are thousands of questions about this sweeping reform of American healthcare and this post only answers a few, but they are important questions. Others will emerge as the act unfolds and people have real, day to day experience with it.
What you are about to read was developed by the Henry J. Kaiser Foundation, a non-profit, non-partisan research organization. This is what their website says about them:
The Henry J. Kaiser Foundation http://www.kff.org/
Who We are
A leader in health policy analysis, health journalism and communication, the Kaiser Family Foundation is dedicated to filling the need for trusted, independent information on the major health issues facing our nation and its people. Kaiser is a non-profit, private operating foundation focusing on the major health care issues facing the U.S., as well as the U.S. role in global health policy. Unlike grant-making foundations, Kaiser develops and runs its own research and communications programs, sometimes in partnership with other non-profit research organizations or major media companies.
We serve as a non-partisan source of facts, information, and analysis for policymakers, the media, the health care community, and the public. Our product is information, always provided free of charge — from the most sophisticated policy research, to basic facts and numbers, to information young people can use to improve their health or elderly people can use to understand their Medicare benefits.
The Kaiser Family Foundation is not associated with Kaiser Permanente or Kaiser Industries.
A Post-election Consumer’s Guide to Health Reform
By Mary Agnes Carey and Jenny Gold, Kaiser Health News
Now that President Barack Obama has won a second term, the Affordable Care Act is back on a fast track.
Some analysts argue that there could be modifications to reduce federal spending as part of a broader deficit deal; for now, this is just speculation. What is clear is that the law will have sweeping ramifications for consumers, state officials, employers and healthcare providers, including hospitals and doctors.
While some of the key features don’t kick in until 2014, the law has already altered the health care industry and established a number of consumer benefits.
Here’s a primer on parts of the law already up and running, what’s to come and ways that provisions could still be altered.
I don’t have health insurance. Under the law, will I have to buy it and what happens if I don’t?
Today, you are not required to have health insurance . But beginning in 2014, most people will have to have it or pay a fine. For individuals, the penalty would start at $95 a year, or up to 1 percent of income, whichever is greater, and rise to $695, or 2.5 percent of income, by 2016.
For families the penalty would be $2,085 or 2.5 percent of household income, whichever is greater. The requirement to have coverage can be waived for several reasons, including financial hardship or religious beliefs.
Millions of additional people will qualify for Medicaid or federal subsidies to buy insurance under the law.
While some states, including most recently Alabama, Wyoming and Montana, have passed laws to block the requirement to carry health insurance, those provisions do not override federal law.
I get my health coverage at work and want to keep my current plan. Will I be able to do that? How will my plan be affected by the health law?
If you get insurance through your job, it is likely to stay that way. But, just as before the law was passed, your employer is not obligated to keep the current plan and may change premiums, deductibles, co-pays and network coverage.
You may have seen some law-related changes already. For example, most plans now ban lifetime coverage limits and include a guarantee that an adult child up to age 26 who can’t get health insurance at a job can stay on her parents’ health plan.
What other parts of the law are now in place?
You are likely to be eligible for preventive services with no out-of-pocket costs, such as breast cancer screenings and cholesterol tests.
Health plans can’t cancel your coverage once you get sick – a practice known as “rescission” – unless you committed fraud when you applied for coverage.
Children with pre-existing conditions cannot be denied coverage. This will apply to adults in 2014.
Insurers will have to provide rebates to consumers if they spend less than 80 to 85 percent of premium dollars on medical care.
Some existing plans, if they haven’t changed significantly since passage of the law, do not have to abide by certain parts of the law. For example, these “grandfathered” plans can still charge beneficiaries part of the cost of preventive services.
If you’re currently in one of these plans, and your employer makes significant changes, such as raising your out-of-pocket costs, the plan would then have to abide by all aspects of the health law.
I want health insurance but I can’t afford it. What will I do?
Depending on your income, you might be eligible for Medicaid. Currently, in most states nonelderly adults without minor children don’t qualify for Medicaid. But beginning in 2014, the federal government is offering to pay the cost of an expansion in the programs so that anyone with an income at or lower than 133 percent of the federal poverty level, (which based on current guidelines would be $14,856 for an individual or $30,656 for a family of four) will be eligible for Medicaid.
The Supreme Court, however, ruled in June that states cannot be forced to make that change. Republican governors in several states have said that they will refuse the expansion, though that may change now that Obama has been re-elected.
What if I make too much money for Medicaid but still can’t afford to buy insurance?
You might be eligible for government subsidies to help you pay for private insurance sold in the state-based insurance marketplaces, called exchanges, slated to begin operation in 2014. Exchanges will sell insurance plans to individuals and small businesses.
These premium subsidies will be available for individuals and families with incomes between 133 percent and 400 percent of the poverty level, or $14,856 to $44,680 for individuals and $30,656 to $92,200 for a family of four (based on current guidelines).
Will it be easier for me to get coverage even if I have health problems?
Insurers will be barred from rejecting applicants based on health status once the exchanges are operating in 2014.
I own a small business. Will I have to buy health insurance for my workers?
No employer is required to provide insurance. But starting in 2014, businesses with 50 or more employees that don’t provide health care coverage and have at least one full-time worker who receives subsidized coverage in the health insurance exchange will have to pay a fee of $2,000 per full-time employee. The firm’s first 30 workers would be excluded from the fee.
However, firms with 50 or fewer people won’t face any penalties.
In addition, if you own a small business, the health law offers a tax credit to help cover the cost. Employers with 25 or fewer full-time workers who earn an average yearly salary of $50,000 or less today can get tax credits of up 35 percent of the cost of premiums. The credit increases to 50 percent in 2014.
I’m over 65. How does the legislation affect seniors?
The law is narrowing a gap in the Medicare Part D prescription drug plan known as the “doughnut hole.” That’s when seniors who have paid a certain initial amount in prescription costs have to pay for all of their drug costs until they spend a total of $4,700 for the year. Then the plan coverage begins again.
That coverage gap will be closed entirely by 2020. Seniors will still be responsible for 25 percent of their prescription drug costs. So far, 5.6 million seniors have saved $4.8 billion on prescription drugs, according to the Department of Health and Human Services.
The law also expanded Medicare’s coverage of preventive services, such as screenings for colon, prostate and breast cancer, which are now free to beneficiaries. Medicare will also pay for an annual wellness visit to the doctor. HHS reports that during the first nine months of 2012, more than 20.7 million Medicare beneficiaries have received preventive services at no cost.
The health law reduced the federal government’s payments to Medicare Advantage plans, run by private insurers as an alternative to the traditional Medicare. Medicare Advantage costs more per beneficiary than traditional Medicare. Critics of those payment cuts say that could mean the private plans may not offer many extra benefits, such as free eyeglasses, hearing aids and gym memberships, that they now provide.
Will I have to pay more for my health care because of the law?
No one knows for sure. Even supporters of the law acknowledge its steps to control health costs, such as incentives to coordinate care better, may take a while to show significant savings. Opponents say the law’s additional coverage requirements will make health insurance more expensive for individuals and for the government.
That said, there are some new taxes and fees. For example, starting in 2013, individuals with earnings above $200,000 and married couples making more than $250,000 will pay a Medicare payroll tax of 2.35 percent, up from the current 1.45 percent, on income over those thresholds. In addition, higher-income people will be taxed 3.8 percent on unearned income, such as dividends and interest.
Starting in 2018, the law also will impose a 40 percent excise tax on the portion of most employer-sponsored health coverage (excluding dental and vision) that exceeds $10,200 a year and $27,500 for families. The tax has been dubbed a “Cadillac” tax because it hits the most generous plans.
In addition, the law also imposes taxes and fees on several major health industries. Beginning in 2013, medical device manufacturers and importers must pay a 2.3 percent tax on the sale of any taxable medical device to raise $29 billion over 10 years. An annual fee for health insurers is expected to raise more than $100 billion over 10 years, while a fee for brand name drugs will bring in another $34 billion.
Those fees will likely be passed onto consumers in the form of higher premiums.
Hasn’t the law hit some bumps in the road?
Yes. For example, the law created high-risk insurance pools to help people buy health insurance. But enrollment in the pools has been less than expected. As of Aug. 31, 86,072 people had signed up for the high-risk pools, but the program, which began in June 2010, was initially expected to enroll between 200,000 and 400,000 people. The cost and the requirements have been difficult for some to meet.
Applicants must be uninsured for six months because of a pre-existing medical condition before they can join a pool. And because participants are sicker than the general population, the premiums are higher.
Enrollment has increased since the summer, after the premiums were lowered in some states by as much as 40 percent and some states stepped up advertising.
A long-term care provision of the law is dead for now. The Community Living Assistance Services and Supports program (CLASS Act) was designed for people to buy federally guaranteed insurance that would have helped consumers eventually cover some long-term-care costs. But last fall, federal officials effectively suspended the program even before it was to begin, saying they could not find a way to make it work financially.
Are there more changes ahead for the law?
Some observers think there could be pressure in Congress to make some changes to the law as a larger package to reduce the deficit. Among those options is scaling back the subsidies that help low-income Americans buy health insurance coverage. The amount of the subsidies, and possibly the Medicaid expansion as well, could be reduced.
It’s also possible that some of the taxes on the health care industry, which help pay for the new benefits in the health law, could be rolled back. For example, legislation to repeal the tax on medical device manufacturers passed the House with support from 37 Democrats (it is not expected to receive Senate consideration this year). Nine House Democrats are co-sponsoring legislation to repeal the law’s annual fee on health insurers.
Meanwhile, the Independent Payment Advisory Board (IPAB), one of the most contentious provisions of the health law, is also under continued attack by lawmakers. IPAB is a 15-member panel charged with making recommendations to reduce Medicare spending if the amount the government spends grows beyond a target rate. If Congress chooses not to accept the recommendations, lawmakers must pass alternative cuts of the same size.
Some Republicans argue that the board amounts to health care rationing and some Democrats have said that they think the panel would transfer power that belongs on Capitol Hill to the executive branch. In March, the House voted to repeal IPAB but that bill did not get past the Senate.
Kaiser Health News is an editorially independent program of the Henry J. Kaiser Family Foundation, a nonprofit, nonpartisan health policy research and communication organization not affiliated with Kaiser Permanente.
Bob Aronson of Bob’s Newheart is a 2007 heart transplant recipient, the founder of Facebook’s nearly 2,500 member Organ Transplant Initiative and the author of most of these donation/transplantation blogs.
You may comment in the space provided or email your thoughts to me at email@example.com. And – please spread the word about the immediate need for more organ donors. There is nothing you can do that is of greater importance. If you convince one person to be an organ and tissue donor you may save or positively affect over 60 lives. Some of those lives may be people you know and love.
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