Paul Ryan Has Been Lying About What TrumpCare Will Do To People With Pre-Existing Conditions

Wednesday, the Kaiser Family Foundation released a new study that goes a long way towards shedding light on what enactment of TrumpCare would actually mean to the millions of people with pre-existing conditions. Short version: over 6 million Americans will wind up unable to afford health insurance or having to pay a lot more for coverage. The study is important because Ryan and his cronies have made a systematic effort to deceive the American people as to the impact of the toxic legislation that was narrowly rammed through the House. One of the fatal flaws- literally fatal-- in TrumpCare is that it "contains a controversial provision that would allow states to waive community rating in the individual insurance market," the concoction of radical right North Carolina extremist Mark Meadows. Kaiser attempts to explain Meadows' horrific vision of health care.

Under the provision, insurers in states with community rating waivers could vary premiums by health status for enrollees who have had a gap in insurance of 63 or more consecutive days in the last year. The higher (or lower) premiums due to health status would apply for an entire plan year (or the remainder of the year in case of people signing up during a special enrollment period), at which point enrollees would be eligible for a community-rated premium unrelated to their health.

States waiving community rating would be required to set up a mechanism to subsidize the cost of high-risk enrollees, such as a high-risk pool, or participate in a reinsurance arrangement that makes payments directly to insurers. States are not required to set up an alternative source of coverage for people who face higher premiums based on their health.

The bill makes $100 billion available to all states for a variety of purposes, including high-risk pools, reinsurance programs, and cost-sharing subsidies. An additional $15 billion is made available for a federal invisible risk-sharing program, which would be similar to a reinsurance arrangement. Another $15 billion is earmarked for spending on maternal and newborn care, mental health, and substance abuse services for the year 2020.  The AHCA also allocates $8 billion over five years to states that implement community rating waivers; these resources can be used to help reduce premiums or pay out-of-pocket medical expenses for people rated based on their health status.

Premiums varied significantly based on health status in the individual market before the Affordable Care Act (ACA) prohibited that practice beginning in 2014. Insurers in nearly all states were also permitted to decline coverage to people with pre-existing conditions seeking individual market insurance. We estimate that 27% of non-elderly adults have a condition that would have led to a decline in coverage in the pre-ACA market. While insurers would have to offer insurance to everyone under the AHCA, people with declinable pre-existing conditions would likely face very large premium surcharges under an AHCA waiver, since insurers were unwilling to cover them at any price before the ACA.

The effect of a community rating waiver would depend crucially on how many people with pre-existing conditions have gaps in insurance that would leave them vulnerable to higher premiums.

Using the most recent National Health Interview Survey (NHIS), we estimate that 27.4 million non-elderly adults nationally had a gap in coverage of at least several months in 2015. This includes 6.3 million people (or 23% of everyone with at least a several-month gap) who have a pre-existing condition that would have led to a denial of insurance in the pre-ACA individual market and would lead to a substantial premium surcharge under AHCA community rating waiver.

Among the 21.1 million people who experienced a gap in coverage and did not have a declinable pre-existing condition, some also had pre-existing conditions (such as asthma, depression, or hypertension) that would not have resulted in an automatic denial by individual market health insurers pre-ACA but that nonetheless could also result in a premium surcharge.

In many cases, people uninsured for several months or more in a year have been without coverage for a long period of time. In other cases, people lose insurance and experience a gap as a result of loss of a job with health benefits or a decrease in income that makes coverage less affordable. Young people may have a gap in coverage as they turn 26 and are unable to stay on their parents’ insurance policies. Medicaid beneficiaries can also have a gap if their incomes rise and they are no longer eligible for the program.

Through expanded Medicaid eligibility and refundable tax credits that subsidized premium in insurance marketplaces, the ACA has substantially reduced coverage gaps. In 2013, before the major provisions of the ACA went into effect, 38.6 million people had a gap of several months, including 8.7 million with declinable pre-existing conditions.

Some people with a gap will ultimately regain coverage through an employer-based plan or Medicaid, and would not be subject to premium surcharges based on their health. However, anyone who has been uninsured for 63 days or more who tries to buy individual market insurance in a state with a community rating waiver would be subject to medical underwriting and potential premium surcharges based on their health.

Why are Republican extremists like Meadows insisting on this gotcha approach that potentially enables the ruination of millions of Americans' lives instead of helping to shore them up. We turned to Matt Coffay, the progressive Democrat running for the North Carolina seat Meadows currently holds, for some insight. Matt isn't wishy-washy or tentative about what the problem is or how to solve it. This morning, he told us

The bottom line here is that Mark Meadows is out of touch with the people of his district. In addition to the loophole for pre-existing conditions, the AHCA also includes $880 billion in cuts to Medicaid. Meanwhile, two rural medical centers in the district are shutting down their labor/delivery and palliative/hospice services due to Medicaid cuts. Meadows is literally voting for legislation that hurts working families, women, children, and the elderly here in Western North Carolina. And he's hedging his bets on the fact that the whole situation with community ratings, Medicaid, insurance premiums, coverage gaps, etc., is too complicated for the average person to be able to follow. Just reading the report from the Kaiser Family Foundation shows how complicated this whole situation has become.

The people of this district are tired of all this complicated stuff. They're tired of excuses, and they're tired of dealing with insurance companies. It's time we made this situation a whole lot simpler. It's time the millionaires and billionaires in this country started paying their fair share, and that we took that money and made sure that health care is available to every single person in the United States. No more fighting with your insurance company, no more jargon. Let's get rid of the mess that insurance companies create, and replace it with a simple system: Medicare for All.

Meanwhile in a related matter, Jan Schakowsky, Chair of the Congressional Progressive Caucus’ Health Care Task Force, sent a letter to Señor Trumpanzee proposing that they work together to reduce the skyrocketing costs of prescription drugs. The letter lays out specific proposals for how the Administration and the Congressional Progressive Caucus could work together during the upcoming reauthorization of the Food and Drug Administration User Fee Agreements.

Throughout your campaign and since becoming President, you have repeatedly stated your desire to lower drug prices. In fact, as recently as March 7, 2017, you stated that you are working on a new system to enhance competition and reduce the price of prescription drugs.  We share those goals and believe that we need to take immediate action to reduce the skyrocketing cost of drugs. To that end, we believe the upcoming reauthorization of the User Fee Agreements (UFAs) provides an opportunity for your Administration and Congress to work together to reform our drug pricing system and bring relief to American families.

...The time has come for us to act. We cannot sit by and watch Americans struggle to afford the drugs they need and jeopardize critical public insurance programs like Medicare and Medicaid as their drug spending continues to rise. We urge you to work with us to improve the lives of millions of Americans by lowering drug prices.

Schakowsky's letter comes as part of the Progressive Caucus' continuing efforts to solve the prescription drug spending crisis facing working families. Kaiser found that 77% of Americans believe the price of drugs is unreasonable, and studies have found that a quarter of American families cannot fill a prescription due to the cost of the drug. Schakowsky's letter identifies specific opportunities for Congress and the Administration to work together to lower drug pricing during the reauthorization of the UFAs between prescription drug companies and the FDA. Ideas for action include requiring Medicare to negotiate for the price of drugs, requiring rebates for high-priced drugs, improving transparency around drug pricing, and ensuring generic drug manufacturers have access to the materials they need to conduct studies essential for FDA approval.