Shutting down health care

[Co-written with LD27 AZ house candidate Deborah Howard]

Will health care only be available for some of us? Resolution of the government shutdown will determine this.

As we write this, the Trump Administration and Republican Congressional leaders have shut down the federal government. Today, October 27, we’re on Day 27. Given that the Republicans in the U.S. House are missing in action, it is likely to continue until at least early next week.

Democrats have drawn two lines in the sand. First, they want assurances that Congressional Republicans will in fact take responsibility for the “power of the purse” and end their acquiescence of the Trump regimes’ flagrant and illegal disregard to spend, or not spend, monies appropriated by Congress. This one is critical for the constitutional checks and balances of our republic, but it might be under the radar for most Americans. The second line in the sand is to protect and extend the premium tax credits for those who purchase health insurance from the Affordable Care Act (ACA) Marketplace. This one strikes more at a tangible concern for many in our country, one that will actually affect nearly everyone with medical insurance, not just those using insurance through the ACA. Without accountability on the first, any compromise on the second is null and void at whim.

To be Obtainable, it must be Affordable

The purpose of the tax credits is to sustain affordability and mitigate health insurance premium fluctuations year to year. The “Big ‘Beautiful’ Bill” passed by earlier this year which made tax cuts for billionaires permanent, eliminated the premium tax credits – starting in 2026. Because of this, as many as 300,000 Arizonans will be at risk of dramatic insurance premium hikes, as shown in the figure below for our state. 

[Source of graph: https://acasignups.net/ira-subsidy-expiration/az ]

Consider a family of four with the Arizona median household income ($76,872 as of 2023). Referencing the chart above, the new budget would essentially double premium costs. A $200 – $300 dollar monthly increase in one household budget line item will be pretty noticeable at a time when inflation continues to raise the prices of so many required purchases.

The holdout of Democrats is more than theatrics

The Republican budget will have broad effects on the health coverage (and ultimately health itself) throughout the country. Not only would some rural hospitals have to close due to the reduction in Medicaid funds; but also, without subsidies, many will be forced to drop insurance entirely because of the unaffordability. The consequences are obvious: delayed care, seeking care in emergency rooms presenting with worse symptoms, and accrued medical debt to the family and increased uncompensated care within the system. A lose, lose, lose proposition. 

Insurance works best the broader the base. As noted by economist Paul Krugman : “These subsidies make it possible for lower-income Americans to afford insurance. They also, crucially, encourage healthy people to stay in the market, holding overall premiums down.”

While changes in Medicaid (AHCCCS in Arizona) will not be in effect until after the midterms (a cynical manipulation by the Republican majority in Congress), the decrease in subsidies for the ACA (Affordable Care Act, also called Obamacare) is happening now, and public health here and elsewhere will be undermined. And this is an urgent issue: the ACA  “open enrollment” period, when we have more options for changing our 2026 health insurance, begins on November 1 and ends on December 15.

Can This Be Fixed?

According to Nate Cohn of the New York Times, Republicans in Congress don’t seem too bothered by the demand to restore the premium support. He says, “Oddly enough, one way to tell is that Republicans seem unusually willing to compromise on Democratic demands.” That being said, there has been little mention of compromise on the idea of restricting Trump’s ability to impound appropriated funds, even though that is a Democratic demand that would restore some of Congress’s constitutionally established power, both for Democrats and Republicans.

Still, the news of interest in compromise on medical insurance costs is promising, because one of the ways out of this mess is to make the premium supports permanent and cap premiums at a percentage of income. This sliding scale recognizes the reality that access to healthcare is a basic human need and sound public policy. Keeping people in the system is both the healthiest and most cost-efficient way of promoting individual and community health.

This is not a perfect solution. In a perfect world advocates and stakeholders would negotiate a serious proposal. But in this world, at this moment, this “solution” to the immediate impasse might be enough.

Can Local Government Help?

If the Democrats are unable to force this issue in Congress, it will be up to state and local governments to do their best to make up for this. It won’t be easy. But doing nothing is not an option. Our legislators need to recognize their responsibility to protect Arizonans.

And if they don’t, they should step down.