I have previously explained that the GOP’s headlong rush to repeal the Affordable Care Act aka “ObamaCare” is actually about repealing the taxes on the very wealthy that help pay for the program. The “blue-collar working class voters” who elected these Tea-Publicans to office will not only lose their health care coverage, they will wind up paying higher taxes as the wealthy receive a huge tax windfall. These voters got played, and the best part is, they did it to themselves.
Jared Bernstein fleshes this out today with new data in How Republican-style health-care reform quickly becomes a tax cut for the richest of the rich:
The election of Donald Trump with a Republican-majority Congress is proving once again that conservative economic policy largely reduces to cutting taxes, mostly for the rich.
But wait a second, aren’t they also wading into health-care reform?
They are, and it proves my point. While much attention is reasonably focused on how they’re all repeal with no replace — and how that’s likely to reverse the coverage gains we’ve seen and undermine insurance markets — there’s something else going on here. And that is — you guessed it — a big tax cut for the rich.
Unless your job description includes denying the facts around the Affordable Care Act, you probably know that it has provided health insurance coverage to 20 million people, lowering the uninsured rate to an all-time low of 9.1 percent, from 16 percent before the reform was enacted. What you might not know is that most of the revenue the ACA raised flows from some very rich waters.
Now, consider the implication of these two facts in the context of repeal and fail-to-replace. There’s been useful reporting on the tens of millions of people expected to lose coverage. But the other side of that equation is a big tax cut for the wealthiest Americans. In other words, the latest payback for some of the working class voters who helped elect the incoming president is to take away their health care and give the savings to millionaires and billionaires.
Just how fat a tax cut? That question is answered in a new report by three of my colleagues at the Center on Budget and Policy Priorities. Using IRS data, they show that the 400 richest Americans, whose average annual income is more than $300 million, would each get an average $7 million kickback from ending two ACA taxes: the 0.9 percent Hospital Insurance tax and the 3.8 percent unearned income Medicare tax. The base for both taxes are individuals with incomes above $200,000 and couples with incomes above $250,000, making this a highly progressive revenue source. That also means that the 160 million households with incomes below these levels get no tax benefits from repealing those taxes.
Indeed, as my CBPP colleagues point out, “ACA repeal would significantly raise taxes on about 7 million low- and moderate-income families due to the loss of their premium tax credits — worth an average of $4,800 in 2017 — that help them buy health coverage through the health insurance marketplaces and afford to go to the doctor when needed.” In fact, as the chart below reveals, the repeal leads to the richest 400 households getting a $2.8 billion tax break that’s bigger than the value of almost 670,000 ACA tax credits worth $2.5 billion going to people in Pennsylvania, Wisconsin and Michigan.
This isn’t just the usual Robin Hood in reverse we’ve come to expect from Republican tax plans: This is Robin Hood slamming the Batmobile into reverse at 100 mph. (A mixed metaphor, but OK).
Recent news reports tell of a few Republicans worrying that repeal might be courting more trouble than their colleagues realize. [See, Republicans look to avoid YouTube moments in fight over Obamacare repeal: “Republicans now appear keen to avoid the kind of dustups capable of racking up millions of views on YouTube and ending up in a 2018 campaign commercial. Only a handful of GOP lawmakers have held or are currently planning to host in-person town hall meetings open to all comers — the sort of large-scale events that helped feed the original Obamacare backlash in the summer of 2009.”].
It’s clear that the president-elect had nothing in mind when he claimed during the campaign that he’d replace the law with “something terrific.” It’s also clear that after 6 years of their feckless and reckless fight for to kill the ACA, the repealers have few ideas for replacement. Importantly, the ideas they have floated — high deductible plans, health savings accounts, block grants for Medicaid and vouchers for Medicare — all shift more costs onto regular people relative to the current system. That is, in fact, the only possible outcome when you so deeply cut health care resources.
So perhaps the ACA repeal will founder on the shoals of political reality, but I doubt it. Reality isn’t exactly constraining this crew.
I recently wrote that I couldn’t think of one proposed Trump policy that would help the working class voters who supported him. These new numbers suggest that I didn’t go nearly far enough. It’s not just that the coming agenda won’t help Trump’s blue-collar constituents — not to mention those in the majority who opposed him — offset the economic costs they’ve borne by being on the wrong side of inequality and globalization. It’s that his policies will hurt them more, exacerbate their economic insecurity, and ratchet up the disparities they face.
Way to go, geniuses. You did it to yourselves.
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You all ought to first define healthcare. If you define it as a meeting with someone society calls a doctor your conversation makes sense.
However, I would not define what they have in Cuba as universal healthcare, I would define it as universal malpractice. I can’t ascertain that they have a single MRI or CAT Scan machine.
The same is true of Europe. They have dramatically fewer scanners than we have and they don’t come close to developing as many drugs as we do.
Obama’s destruction of our healthcare marketplace is about to have dramatic consequences. Antibiotic resistance is developing at a blistering pace. Soon, it will become absolute.
One of the first recipients of antibiotics was walking in his garden and was scratched by a thorn. As the infection from that scratch spread, they had to remove one of his eyes and his scalp was oozing puss.
That is our future with death at the end for one out of six people who get a heart valve replacement, a knee or a hip replacement – or any kind of invasive procedure.
This is a true apocalypse that ought to be focusing our attention, not the fake one you call man made climate change.
Socialized medicine will destroy our ability to cope with antibiotic resistant bacteria and infections.
Ed, you want to know what our economic growth has been good for? Since 1992, our cancer death rate has been reduced by 25% Next time you have a loved one come down with cancer and gets cured, say thank you Ronald Reagan.
If I get cancer, I’m gonna die, because there’s no way in hell that I can afford $200,000 for a chemo regimen that hospitals and drug companies charge in the ‘free’ market. So, if you get cancer, congrats that modern medicine could save your life, and thank whichever deity you worship.
That’s the reality for far too many of us in this messed-up, dog-eat-dog world we call ‘capitalism’.
“That’s the reality for far too many of us in this messed-up, dog-eat-dog world we call ‘capitalism’.”
How can that be, Edward? In this day of Obamacare are you saying you couldn’t afford insurance? If so, why would you defend the ACA so vigorously?
“If I get cancer, I’m gonna die, because there’s no way in hell that I can afford $200,000 for a chemo regimen that hospitals and drug companies charge in the ‘free’ market.”
Of course you couldn’t afford that…most people couldn’t afford that. That is why you buy insurance. And giving everyone the ability to buy health insurance was the basic purpose of the ACA, so what happened? Why couldn’t you buy insurance? In what way did the ACA let you down?
More people would have insurance under the ACA if all 50 states participated in the Medicaid expansion.
http://kff.org/health-reform/slide/current-status-of-the-medicaid-expansion-decision/
Probably has something to do with the state legislature keeping tuition high in violation of the State Constitution, payment for grad assistantships low (although it increased this past year), and refusing the subsidy money for the Medicaid expansion because it was politically convenient to block one of the former president’s achievements so he would look bad.
To be fair, I do have insurance, but only because of the provision which allows me to stay on my parents insurance until age 26.
Otherwise, no, I could afford two of: basic living expenses, saving for retirement, and paying for health insurance & medical costs.
“Otherwise, no, I could afford two of: basic living expenses, saving for retirement, and paying for health insurance & medical costs.”
Well, I am glad you do have insurance. I am a little disappointed that you would not see what is obvious about your “2 out of 3” choices. That it is a perfectly reasonable set of choices for an [up to] 26-year old. If you are basically healthy, go for retirement savings. If you are not so healthy, put off retirement savings and buy health insurance. Lots of people have been making that decision for years. It really isn’t a hard one to make.
I am really sorry. You are caught at the confluence of a bunch of unfortunate circumstances, aren’t you. But you are investing in your future, and this is only temporary, so your future looks bright!
It would not surprise me if GoFundMe.com becomes a significant part of the GOP’s Obamacare “replacement”.
Age adjusted death rates actually declined most for minority and poor populations from 1992 to 2008, the pre Obama era.
Your unrooted retort implying that a ‘free market’ results in worse health outcomes for poor people relative to socialized medicine environments is just not true.
The average cost of a chemo regime is $30,000 not $200,000 and that is the average cost. People who can’t afford to pay get big discounts, that is the definition of average.
And, as far as your retort goes, you will be dead if you get crushed in a car accident also. But, auto death rates haven’t been this low since 1921, when most people were still on horses. The question is, under what system will age adjusted death rates drop the most?
Socialized medicine is death threat to all of us and not just a death threat – there are things worse than death. We have a chance to defeat alzheimers in the coming decades if the pace of investment stays intense. The US, with 4% of the worlds population, creates over 55% of the world’s pharmaceuticals.
Most of the expensive life saving drugs you want to have easy access to were created by a system that you want to destroy- “dog eat dog capitalism”.
You’ve read too much Marx and Picketty.
Age-adjusted death rates seem to have fallen for the top half of the population by income, and risen or remained constant from the bottom third.
Infant mortality rates are higher in the United States (6.2 / 100k) than in more socialized nations such as Italy (5.5), France (3.3), or Spain (4.2) (So much for those 82 billion work-hours in the U.S, right?)
Most of the expensive life-saving drugs were created by basic research funded by the government and conducted by universities and the military, which is then privatized, monopolized, and commercialized by private entities. Indeed, private companies tend to focus on late-stage trials, along with a healthy expenditure on marketing to patients and doctors alike, while the government is actually funding the basic research that can yield critical breakthroughs. Not to mention the fact that pharmaceutical research by private firms actually declined from 2004 to 2012 in the United States; this certainly suggests that the profit motive is a lot less concerned about, say, antibiotic resistance than you seem to be; the positive externalities of effective antibiotics and the effect on contagion attest to that fact.
But then again, science and technological research by scientists, doctors, and technicians really did all that. Capitalism just decided where the generated wealth would go.
You’ve read too much Rand and von Mises.
The fact is that for decades, the U.S. has shown superior infant-mortality rates using official National Center for Health Statistics and European Perinatal Health Report data — in fact, the best in the world outside of Sweden and Norway, even without correcting for any of the population and risk-factor differences deleterious to the U.S. — for premature and low-birth-weight babies, the newborns who actually need medical care and who are at highest risk of dying.
Comparing infant death rates is much like comparing Arizona test scores. Our Blacks, Hispanics and Whites outscore Wisconsin Blacks, Hispanics and Whites yet the average of their test scores is significantly higher than ours. One of the other readers actually referred to a name for this phenomena.
Comparing
Read more at: http://www.nationalreview.com/article/276952/infant-mortality-deceptive-statistic-scott-w-atlas
Liza is correct in naming the fundamental question. “We have to decide if healthcare is a right and not a privilege. If healthcare is a right we build the system that provides it, and I do not believe that system can be based on private insurance and profit.” How we answer that question sets in motion what we build.
Even if we determine that healthcare is a right, we will also have to determine how much we are willing to spend on it. Like defense, it will soak up every dollar you are willing to throw it’s way. How much is enough? Where do we draw the line and say “saving one more life is NOT worth it?” That will be one of the HARDEST decisions this Nation ever makes because interested parties will wage “no holds barred” propaganda campaigns to demand more and more and more money be spent on healthcare. If you want to talk about the “bottomless pit” of rights, healthcare will be it. Who is strong enough to look a child in eyes, or an elderly woman, and say, “I’m sorry but we can’t afford to keep you alive”?
Steve – Well put about hard choices. Now flip your response around and assume we make the determination of health care as a privilege. What hard choice follow?
“…assume we make the determination of health care as a privilege.”
No, Bill, I won’t accept you defining the terms we use in order to control the conversation. Just because healthcare is not a right, does not mean it is a “privilege”. The very word “privilege” is a loaded word that implies there is a cabal somewhere that hands out healthcare to a select few and is denied to all others. That is not the case at all.
If healthcare is not a right, then it becomes a commodity. It is distributed the way all commoditys are distributed…based on the law of supply and demand. People decide how important it is and the allocate their resources accordingly. Some mitigate their risk by buying insurance. Some get their healthcare through third parties, such as employers (who provide it as part of their compensation packages). Some do without a second car or cable TV to pay for it. And, sadly, some can’t afford it. For those, we can do as we have done, provide a basic level of health care through government grants, charities, government services, etc. That would provide for 80% to 90% of their health care needs. For the balance I have no solution.
“The very word “privilege” is a loaded word that implies there is a cabal somewhere that hands out healthcare to a select few and is denied to all others. That is not the case at all.”
If a reasonable level of healthcare is available only to those who have good insurance or the money to buy anything, then it is, in fact, a privilege.
And we know what is a reasonable level of healthcare especially on the preventive side. Physical exams, vaccinations, certain screenings, etc… are all part of preventive healthcare.
On the diagnostic and treatment side of healthcare there is more of a gray area in defining what is a reasonable level. But what should be clear is that people should not have to suffer needlessly or die because they cannot pay for treatment or care that is not extraordinary or remarkable. I think we all have a fairly good concept of what this means.
“If a reasonable level of healthcare is available only to those who have good insurance or the money to buy anything, then it is, in fact, a privilege.
I can assure you, Liza, when my wife and I started out, we were not able to “buy anything”. We scrimped and saved to buy healthcare, but it was important to us. I remember making a decision to buy a cheap car with cheap insurance, and no second car (I rode a bike back and forth to ASU and my job at Jack-in-the-Box), eating lots of beans and corn bread, no going out to eat or the movies, and a hundred other ways to scrimp on money. So when you say healthcare is a privilege, I disagree strongly. It is something that can be had by most people if they make it a priority. Stop making second cars, big screen TVs, smart phones with data plans, cable TVs, etc., a priority and most people can afford health care. I say this because I volunteer and work at the St. Mary’s Food Bank, Salvation Army Food Kitchens, and a few other places that assist the poor. I enjoy doing it because it really does help some people, but I am also struck by how many designer sunglasses I see, and $600 smart phones of the latest design, and Tommy Chu shoes, and designer clothes, and how many boxes of food I load into the back of late model new cars. I am not saying that is the norm, or even close to the norm, but it happens often enough that I sometimes question our definition of “poor”.
Now, having said all that, I want you to know that I agree with you that healthcare should be considered a right. But I am realistic enough to know that we are NOT going to come to a concensus as a nation about what constitutes a “reasonable” level of health care.
“I think we all have a fairly good concept of what this [reasonable] means.
I wish that were so. When I had cancer, my family thought there was no limit to the healthcare that was reasonable. If any of my children or grandchildren were seriously ill, I wouldn’t want to hear anything about a reasonable level of healthcare. If we try to establish a reasonable level of healthcare, lawyers will have a field day. I think we are going to have to try, and try hard, to make it a universal right, but it will be tough. And we will have to establish death panels to decide who lives and who dies when the money gets tight because the money will get tight. And the lawyers will still get rich.
“It (healthcare) is something that can be had by most people if they make it a priority.”
That simply isn’t true. For example:
http://www.feedingamerica.org/hunger-in-america/impact-of-hunger/hunger-and-poverty/hunger-and-poverty-fact-sheet.html
It’s not difficult to quantify poverty in this country, so supporting one’s own theories with anecdotal evidence (“I see lots of smartphones and designer sunglasses out there”) is essentially bogus.
I’ve already conceded that a reasonable level of healthcare at diagnostic and treatment level has a gray area and this is where individual cases like your cancer might spur controversy. And what is reasonable certainly changes over time (ex: reconstructive breast surgery after mastectomy) and is actually improving, in my opinion.
So we can argue this point and come up with numerous examples from our own experience and observation. But society as a whole is better served when all people have both preventive care and diagnostic care and treatment when they are sick or injured. To think otherwise seems kind of delusional and self serving.
I think there’s a couple of interesting charts to show the problem:
https://www.ncbi.nlm.nih.gov/books/NBK321304/figure/fig_S-1/?report=objectonly
https://www.ncbi.nlm.nih.gov/books/NBK321304/figure/fig_S-2/?report=objectonly
Obviously, life expectancy isn’t a perfect measure of the efficacy of the healthcare system, but for all of the benefits that Mr. Huppenthal lauds on our healthcare system, they only really accrue to the top quintile of Americans. The bottom half of women, and bottom third of men, have seen a *decrease* in life expectancy at Age 50 over the past 30 years.
Some of this can no doubt be attributed to worse lifestyle choices (which are themselves in part because healthy food is often much more expensive than cheap, unhealthy food), but it’s worth noting that there is substantial data suggesting that the picture isn’t as rosy as some would like to claim.
(I do not know the extent, if any, to which the ACA contributes to or mitigates this effect.)
With no proof at all, you accuse Republican lawmakers, none of whom makes over $300 million dollars a year, of voting for tax cuts for the super rich at their own expense.
Ridiculous, unfounded and highly partisan – Perfect for BfA.
Ooops! I forgot paranoid.
Dude, the Senate and House have already voted for the “budget reconciliation” process that will gut the financial provisions of the ACA, the only thing left to do are the final roll call votes. And there is no GOP replacement plan, which would require Democratic votes to enact.
Well, they said they were going to get rid of it. Did you think they joking? The ACA cause pain when it came in and it will cause pain when it goes out. Suddenly changing anything that affects 1/7th of our economy will do that.
That has nothing to do with my comment. Please make your posts relevant and address the issue when you comment on someone else’s post.
I do not deny that Republicans want to end ACA. My comment was that I think that your perceived motive is idiotic. Comment on that!
the problem was and is obama and the democrats were not tough enough as usual. they should have said as I say you stop medicare for all americans then you republicans and those few bought democrats will pay for what they have done for a change. if people die for lack of healthcare you will be arrested and held in box cars while you wait your trial in washington d.c. with an all black jury. and the republicans and wimp democrats on the supreme court will be impeached off of it. republicans have two motives fear and greed I would and we should make them fear for their lives for a change. that is why the people voted republican in 2010 disgust with democrat gutlessness. this is also why the voted for trump over hillary clinton. others whine and complain I counter attack!
“…if people die for lack of healthcare you will be arrested and held in box cars while you wait your trial in washington d.c. with an all black jury…”
LMAO.
I was a supporter of the ACA when it was first introduced. I thought the theory was a good one and I thought health insurance for everyone was a good idea. I still do. I was a little wary of the ACA after I heard Pelosi say, “We will have to pass it to see what’s in it”, but I still thought it was moving in the right direction.
Then I saw what happened as the ACA was implemented and I became more and more discouraged as I realized the intent behind the Act was less about health care for everyone and more about punishing the wealthy out of envy. No one had mentioned how the large subsidies for the poor were going to allow insurance rates to increase beyond the budgets of the middle class that were not receiving the subsidies. In the end, the poor had health care but many in the middle class found they couldn’t afford it and wound up having to pay a penalty for not buying insurance. That was another pig-in-a-poke that many didn’t realize would happen when the ACA made insurance mandatory, forcing larger and larger penalties on those who couldn’t afford the insurance rates. Then there was increasing talk about raising the penalties so as to really force people to buy insurance. In short, I realized that the ACA was becoming less health insurance than a vehicle for punishing those who had more than others and forcing the democrat concept of “fairness” on people whom they couldn’t convert to their way of thinking.
Perhaps once the ACA is eliminated, Congress can work on a genuine health insurance program that actually provides health insurance without punishing some to the benefit of others.
Let’s look at this from the opposite point of view, though.
We know, among other things that:
1) Insurance works, in a general sense, by pooling risk. More formally, if you have ‘n’ i.i.d. random variables, the standard deviation of the pool only increases by sqrt(n), and the insurer will make money on some people who have good realizations (don’t get sick), and lose money on people who have bad states of the world (i.e. get a heart attack / cancer).
2) Private insurance isn’t actuarially fair. The ACA places a minimum payout rate of, I believe 80%, of all premiums. This means that insurers are allowed to charge 25% above the actuarially fair rates to cover overhead and make a private profit.
3) In general, the insurance market is subject to both information asymmetry and moral hazard. Not only to the insured have more information than the insurer, but they can change their behavior when they are shielded from the adverse consequences of bad behavior (i.e. excessive eating, smoking, drinking, etc.)
4) Because of (2) and (3), a rational agent facing insurance purchases it only if the realization of their private information (health status) is bad enough to purchase at the market price. This creates an adverse selection problem, and the end-result is the infamous ‘death spiral’, where prices continue to rise and more and more people drop out of the market, defeating the very purpose of insurance (i.e., (1)). The insurance mandate is a way to stop the death spiral.
Now, there are a lot of ways that we can get at costs, but unfortunately, too much of the ACA was dealing with the insurance market and bowing to the insurance lobby (and their profits), and not enough with getting at the underlying costs (i.e. actual healthcare). And to some extent, more insurance might have pushed some costs down – if some people can’t or won’t pay for care, prices for everyone else go up as the provider tries to recoup costs.
Let’s be straight forward, Edward, and acknowledge that the ACA is not really “insurance” at all. It ceased being insurance when insurance compamies were required to accept pre-existing conditions. With insurance you pay a third party to accept your risk of an event occurring for a fee. But if I can wait until the event actually occurs and then pay a third party to fix things for me, we are no talking about insurance. I really don’t know what to call it, but it is something out of Bizarro World.
As the ACA exists, right now I can pay the penalty rather than the more expensive insurance rates, and if I develop cancer, I can then buy the insurance to take care of my very expensive cancer treatments. On the other hand, if I never come down with cancer, I don’t have to buy any insurance and can save the money I would have spent on premiums.
THAT is why the insurance mansate is necessary. You have to force everyone to participate so that the healthy people can subsidize the sick ones. You can not allow people to exercize personal choice because they will not choose the way you want them to. Like so many democratic ideas, people do not want to voluntarily participate in them…thus the hint of totalitarianism that is part of so many democrat initiatives.
Ah! If only car insurance was that way…imagine only buying it after the accident occurs? Stupid, huh?
“…if I develop cancer, I can then buy the insurance to take care of my very expensive cancer treatments.”
Not totally true. You can buy insurance through the ACA during open enrollment or if you qualify for a special enrollment. Not having insurance does not qualify you for special enrollment.
So, if you are uninsured by choice and develop cancer, you better do it during open enrollment.
“Not totally true. You can buy insurance through the ACA during open enrollment or if you qualify for a special enrollment.”
Thank you for the correction, Liza. I was not aware of that. But now that you mentioned it, I do recall hearing that they kept extending the open enrollment period for some reason…I guess it just didn’t register with me.
I actually think the quickest path to single payer health care in this country is for the Republicans to move forward with their obliteration of what we have. But we can’t allow them to heap all of that suffering and death on people who do not deserve it.
This is where I agree with Bernie Sanders and always have. We have to decide if healthcare is a right and not a privilege. If healthcare is a right we build the system that provides it, and I do not believe that system can be based on private insurance and profit.
I was thinking about the VA and some of the negative things that are being said. I have some familiarity with the VA because of my husband being a disabled veteran and we have spent quite a bit of time there in the past year.
My observation is that things run pretty well. I sit in waiting rooms where people are calm, not complaining, waiting their turn, etc…The people who work there are proficient and caring. I honestly cannot recall even one problem in the last 15 years. Their medical records are quite good and easily accessible which is a very good thing for patients who have multiple health problems. The VA also has many volunteers, good people who want to help, and this system works well.
We can build whatever we need. This is America, right?
“We can build whatever we need. This is America, right?”
I believe we can. The only problem is agreeing as to what we want.