With House Speaker Paul Ryan’s latest proposal to replace “Obamacare,” Republicans have confirmed their complete disinterest in addressing the health care crisis. Following closely behind, Democrats’ own “solution” to the health care debacle is in a free fall, and that may be for the best. First, it’s worth taking a look at the Republican plan, which offers little hope for lowering health care costs and increasing coverage. Ryan’s proposal promises “more patient-centered care, not more bureaucracy.” It requires the following: 1. a repeal of the Affordable Care Act’s (ACA) mandate that all Americans purchase health insurance if they are not already covered; 2. elimination of the ACA’s state-based insurance exchanges; 3. the establishment of “high risk” insurance pools to help sick Americans secure coverage; and 4. the introduction of a tax credit refund for those buying private health insurance. Ryan’s proposal is largely a rehash of Republican’s pre-“Obamacare” proposals, which also called for tax refunds for individual consumers and for the establishment of high-risk pools.
Ryan’s proposal is dead on arrival, and not simply because it will be opposed by Democrats, but because it’s a non-solution to the health care problem. The plan will do nothing to help uninsured Americans afford skyrocketing health care premiums, growing out-of-pocket costs, and escalating deductibles. Ryan’s plan does nothing to help those who are not poor enough to qualify for Medicaid, but who cannot afford the growing costs of private market insurance plans. His plan will simply target more affluent Americans who already have insurance, granting them a modest end-of-year subsidy added to their tax returns. As the non-partisan Politifact reported back in 2009, the Republican’s original high-risk pool plan was projected to reduce the number of uninsured Americans by just three million from 2010 to 2019, “leaving 52 million nonelderly Americans uninsured. That means 83 percent of legal non-elderly residents would have insurance coverage by 2019, roughly the same as it is today” . Comparatively, the Affordable Care Act cut the number of uninsured Americans almost in half, reducing it by nearly 25 million from 2014 to 2016 alone. In contrast, a shift to the Ryan plan would likely increase the number of uninsured, since millions of Americans would lose access to state insurance exchanges that provide them federal subsidies for purchasing health care plans.
Republicans’ preference for high-risk pools was also heavily criticized for doing nothing to reduce high health care costs for sick Americans. As Politifact reported in 2009, “In theory, experts say, such pools could be subsidized enough to make premiums low enough to be attractive. But it would be expensive to do so, and many experts say the Republican plan doesn’t provide enough money to make them work.”
Most importantly, Ryan’s proposal does not address the central problems in American health care, including: 1. the growing power of for-profit insurance companies, which gouge consumers with double-digit premium increases per year and other added costs, in search of ever-higher profits; 2. the hands-off approach to dealing with prescription drug and health care costs, as seen in the federal government’s near complete resistance to regulating drug prices and inpatient/outpatient costs. The failure to control health care costs also applies to “Obamacare.” The law contained few cost-control measures, contrary to laws in other first world countries, which provide single-payer, not-for-profit care to all citizens, and regulate what drug companies and doctors/hospitals can charge for health care services. Lacking a universal health care system, U.S. health care outcomes are abysmal, in addition to being extremely expensive. Recent research finds that, although the U.S. has the highest health care costs among wealthy countries, its health care outcomes (in terms of citizen access to care and quality of care) are among the worst (Forbes, “U.S. Healthcare Ranked Dead Last Compared to 10 Other Countries,” June 2014).
There is some evidence that “Obamacare” is lessening the severity of the American health care crisis. Data from the Centers for Disease Control and Prevention (CDC) suggest that, under the law, the number of uninsured Americans fell to 28.6 million in 2015, from 50.7 million in 2010. While 15.1 percent of Americans were uninsured in 2011, the number fell to 9.1 percent in 2015. But providing coverage is merely the first requirement of any competent, effective, and humane health care system. Quality and cost of health care are also vital. On these fronts, the U.S. is failing miserably compared to other countries. According to the Kaiser Foundation, health care premium costs increased by ten percent from 2015 to 2016 alone across the 50 states. As Forbes reports, health care costs for a family of four in the U.S. reached a record high of $24,671 a year in 2015, up from $18,074 in 2010, and $12,214 in 2005. In other words, the cost of family care increased by 36 percent since “Obamacare” was passed in 2010, and by 12 percent between 2014 and 2015 alone, when the law was first put into full effect. In contrast, inflation increased by just two percent during the same period, suggesting a drastic increase in health care above what would be expected from increases in cost-of-living. Clearly, the ACA is not reducing the costs of American health care. This should be no surprise, considering the law left in place the parasitic health insurance companies, which are committed to maximizing profits by increasing out of pocket, deductible, and premium costs every year, well beyond changes in the cost-of-living index.
Some recent evidence suggests that the cost of health care in the U.S. has grown at a lower rate than the federal government expected over the last six years. As Vox reports, national health care expenditures in 2015 were $2.6 trillion less than the Center for Medicare and Medicaid Services originally projected costs would be when estimates were done in 2010. This, however, does not mean that the Affordable Care Act caused a lower-than-expected growth in costs for those on private insurance plans. As Vox states, government analysts admit that the Affordable Care Act is “far from the main contributor” to lower-than-expected costs. More relevant causes are the lower-than-expected Medicare and Medicaid costs. National statistics show a startling jump in costs for family health insurance plans in recent years. Furthermore, many insurers have used the Affordable Care Act’s requirement that they cover all Americans (including the sick) as an excuse to significantly increase rates, deductibles, and out-of-pockets across the board. Employers have used the “Cadillac tax” provision of the ACA (which imposes a fine for health care plans costing employers more than $10,200 for individuals) as an excuse to shift costs further to workers – something they already wanted to do. The provision was meant to encourage employers to find less expensive, quality health plans, but it actually accomplished the opposite by providing companies and government employers an excuse to cut benefits.
Because of growing costs of care, individuals are becoming less likely to use their health insurance, as they seek to save on costs to combat insurers’ price gouging. With large increases in cost, an obvious question arises: why celebrate citizens securing health insurance if many are too broke to afford the care itself? As USA Today reports, “employer-provided family insurance plans have seen significant spikes in cost in recent years, pushing many Americans to avoid seeing their doctor altogether. [Employer-health] coverage long considered the gold standard of health insurance now often requires workers to pay so much out-of-pocket that many feel they must skip doctor visits, or put off medical procedures, avoid filling prescriptions and ration pills – much as the uninsured have done.” The newspaper references a recent Commonwealth Fund survey, which finds that four in every ten working adults avoid care at some point because of concern with cost and inability to pay. And growing costs under employer plans are real. For example, the percent of workers paying deductibles under employer insurance increased from 55 percent of workers in 2007 to 80 percent in 2015, according to the Kaiser Family Foundation. High-deductible plans, which shift deductible costs from employer to employee, grew significantly in recent years. According to a Mercer study, from 2014 to 2015 alone, the number of U.S. employees covered by such plans increased from 18 percent to 23 percent. USA Today reports that average deductibles for Americans increased in the eight years from 2007 to 2015 from $584 to $1,217, a 108 percent increase.
As much as Obama supporters want to believe the Affordable Care Act is the solution to America’s growing health care crisis, the evidence suggests this is not the case. Neither Democrats nor Republicans have presented any viable solution to the health care debacle, because neither party is willing to offer a universal health care, single-payer based system that will challenge the growing power of the health insurance industry. Until a real alternative to for-profit health care is developed, little is going to stem the rising tide of health care costs. No presidential front-runner – neither Hillary Clinton nor Donald Trump – offer any realistic plan for tackling the health care problem. Trump makes vague references to universal health care, while also paying lip service to Paul Ryan’s health care proposal. Clinton opposes a single-payer plan, instead celebrating “Obamacare,” and offering to build on it to ensure greater coverage for citizens and lower costs. Clinton’s goals are a pipedream so long as a for-profit health insurance is left in place across the nation. Trump’s rhetoric is superficial eye candy in light of his refusal to offer a concrete single-payer proposal. As health care costs continue to grow unsustainable in the next decade, the pressure will only become greater for a real solution to America’s health care nightmare.