What We Know About the Health Care Bill

(Note: Since this post, the US Senate has drafted a new health care bill, the Better Care Reconciliation Act [BCRA]. The BCRA’s provisions – and their many negative impacts – are virtually identical to those contained in the American Health Care.)

Experts at the Congressional Budget Office say the American Health Care Act (AHCA) would result in 23 million people — including children, the disabled and those with pre-existing conditions — losing coverage by 2026. The analysis also shows the bill would disproportionately affect older Americans, ages 50 to 64, and those covered by Medicaid. Obviously, this includes thousands of Iowans.

Iowa hospitals are particularly concerned about the enormously negative impact to Medicaid from AHCA, which includes $834 billion in cuts to the program. Most distressing is the bill’s intent to roll back Medicaid expansion, which has benefited some 150,000 Iowans who now have coverage and much improved access to consistent, coordinated health care.

AHCA “per-capita caps” placed on Medicaid federal funding would shift greater cost and risk to states. In turn, states would likely respond by tightening Medicaid eligibility requirements and reducing enrollee benefits and provider payments. Meanwhile, states would have to fully cover any future unexpected Medicaid costs without federal help, radically changing a 50-year partnership between state and federal government that has responded to unexpected health crises, including hurricanes and floods as well as economic downturns. Again, tightening eligibility and cutting payments are likely responses.

Here is what else we know:

AHCA would be especially harmful to rural Americans. Nearly 1.7 million rural Americans have gained coverage through Medicaid expansion. In Iowa and at least seven other expansion states, more than one-third of expansion enrollees live in rural areas. Rural hospitals depend on Medicaid for 10-20 percent of their revenue and, because of their smaller patient volume, do not have other revenue sources to make up for what would be lost if AHCA is implemented. Most of the 78 rural hospitals that have closed since 2010 are in states that did not expand Medicaid.

AHCA would cost Iowa jobs: A new study estimates the AHCA would cause serious economic damage across the nation, including the loss of some 9,200 jobs in Iowa. The AHCA would raise employment and economic activity at first, but lower them in the long run. It initially raises the federal deficit when taxes are repealed, leading to 864,000 more jobs in 2018. In later years, reductions in support for health insurance would cause negative economic effects. By 2026, 924,000 jobs would be lost, gross state products would be $93 billion lower and business output would be $148 billion less.

AHCA threatens special education programs. School districts, including those in Iowa, rely on Medicaid to provide costly services to millions of students with disabilities across the country. AHCA-imposed “per-capita caps” on Medicaid would effectively transfer the burden of health care to state budgets, likely resulting in higher taxes, eligibility cuts or curtailed services for children or others who depend on Medicaid. Many such education services are mandated under federal law but even now struggle from chronic underfunding.

Medicaid is crucial to fighting the opioid crisis. More than two million Americans are fighting a prescription opioid addiction and another 591,000 have a heroin addiction. Opioid overdoses killed 61 Iowans in 2015, more than double the number from 2005. Medicaid and the Children’s Health Insurance Program cover about one in three of these patients, but their coverage could be lost under AHCA. Coverage of expensive medications, such as methadone and naltrexone, is included in most states’ Medicaid programs and has been effective in reversing addiction, especially when combined with counseling. Most states have also increased Medicaid enrollees’ access to naloxone, which can save the life of someone who has overdosed on opioids.

AHCA could also affect people insured through their work. The Affordable Care Act (ACA), which AHCA seeks to replace, protects essential health benefits (EHBs), a baseline of common procedures and items including emergency room visits, prenatal care, mental-health care and some prescriptions. Because of ACA, employer plans cannot place lifetime limits on the amount plans pay out on EHBs and requires plans to limit out-of-pocket costs an employee must pay annually. The AHCA would allow a business to drop these employee protections by choosing regulations by way of a state-granted waiver.

Americans generally agree that AHCA is a bad idea. The most recent Kaiser Health Tracking Poll finds more Americans have an unfavorable view of the AHCA than a favorable one (55 percent vs. 31 percent, respectively). This poll also showed a considerable “enthusiasm gap” with a far larger share saying that they have a “very unfavorable” view (40 percent) than saying they have a “very favorable” view (12 percent). An earlier Quinnipiac poll showed similar results, with 21 percent of voters supporting AHCA while 56 percent opposed it.

Meanwhile, public approval of ACA has increased to a majority since the election, according to Gallup, from 42 percent approving and 53 percent disapproving in November 2016 to 55 percent approving and 41 percent disapproving in early April 2017.