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The Big Lie About Health Care

So Paul Ryan and Mitch McConnell stood up yesterday, in their latest act of unbridled arrogance and complete disregard for the American people, and said they are going to replace Obamacare with a plan that will increase choice for health care “consumers” and at the same time increase affordability. (Trump has promised that he would provide  “insurance for everybody”.)

Of course they were lying.

When you’re doing something truly despicable that will inflict needless suffering on countless millions of people, make sure you lie about it – the bigger the lie the better – so you confuse enough under-informed people (your victims) not only about what you are doing but about your true intent.

This strategy (let’s call it the Trump strategy, although he’s not smart enough to have invented it) requires that you remain blind to the actual ramifications of your actions so that 1) you can live with yourself and 2) you can pretend the consequences won’t come back to bite you.

What they actually propose to do will have exactly the opposite result from what they claim: their  Obamacare replacement plan will greatly reduce the choices of health plans that actually provide health care, and the choices will be reduced precisely because all the plans that actually cover expenses in any meaningful way will become strikingly more expensive and unaffordable.

They also claimed their plan would increase competition. I guess they meant among the four or five large insurance companies who dominate the health insurance market across the entire nation, several of whom are trying to merge with each other to further reduce the competition (which mergers will no doubt soon be approved by the new Republican non-regulators).

I’m going to make a wild-assed guess and predict that within not too many years this plan will make health care drastically worse for upwards of 150 million people in the USA. How’s that for making America great again?

Hyperbole? Let’s do the math. 70 million people on Medicaid who will quickly feel cuts in their benefits from the proposed changes in the Medicaid funding formula. 20 million on the exchanges – details are still vague, but I assume the exchange plan enrollees somehow will be dumped into the non-exchange individual insurance market- will see their premiums go through the roof and will be forced to drop coverage or settle for catastrophic coverage only, which of course will not include any coverage for preventive care as was mandated in Obamacare. I advise young people to drop their coverage as soon as you can. With your $10 an hour jobs you won’t be able to afford it anyway. You’ll still be able to buy it later if you get really sick, and the proposed 30% premium penalty you have to pay to re-start lapsed coverage will surely be less than the money you save by not paying premiums and far less than the medical bills the insurance companies will have to pay on your behalf. You can use your savings to pay your penalty if you ever need it, which is unlikely for most of you.

Once those 20 million people are thrown off the exchanges and all the young people drop or reduce coverage, the people who are already ill with the handful of chronic diseases that account for most health care costs will be the only ones left on the plans that actually cover anything, and the premiums for them will rise even faster, forcing more people to drop out, pushing up rates still faster. It’s called the Death Spiral in the insurance industry. In fact this plan is going to completely blow up all the individual insurance markets and seriously damage the group/employer markets, especially the markets for small employers who have to buy fully-insured plans because they don’t have enough employees to self-insure and at least partially escape the clutches of the insurance companies. Ryan and all his advisers know this. It was all thoroughly discussed in the process of foisting Obamacare on the American people. They just pretend it’s not going to happen. Or at least they want you to believe it’s not going to happen.

The reduced revenue from the federal subsidies combined with losses on their plans with spiraling premiums will force insurers to raise prices for all their other clients to preserve the profit margins they became accustomed to under the corporate give-away that Obamacare really was (when the only sensible choice was Medicare for everyone). And that in turn will induce employers to cut benefits even further than they already have and shift even more costs to employees.

So how many more tens of millions of people is that? I don’t know for sure. I guess about everyone who’s not on Medicare. So that’s at least 150 million people. I was just being conservative (pardon the expression) in my estimate.

But don’t worry, the Republicans say. You’ll still be able to afford coverage because we’ll give you tax credits instead of subsidies for the already ridiculously overpriced plans. Hahahaha. Tax credits for people who don’t have the money to pay for the insurance in the first place and don’t pay any federal income taxes anyway cause they’re so poor (45% of the population). Hahahahaha. And they actually expect people to believe this gibberish. People know the ridiculous prices they pay for insurance already. And even a rich person, who let’s say is paying $12,000 a year now for an insurance plan (if he or she is lucky), will get a tax credit of up to $4,000 a year. But when that premium quickly jumps to $18,000, and then $24,000, even the rich won’t be so happy with their new Trump-arranged deal.

Of course they also propose to eliminate all the taxes on individuals and industry that helped pay for Obamacare, so at least rich people and a few corporations will get a break. Sound like something you’ve heard from Republicans before. Charge the lower and middle classes more money so you can throw more money at the corporations and the miniscule number of rich people who own almost all of their stock.

This is not a serious attempt to solve the problem. It’s an ideological mishmash of ideas designed (ineptly) to achieve ideological goals that have nothing to do with the actual business of health insurance, and that directly contradict the well-known experience of the insurance industry itself. In fact, it is not possible for Republicans to replace Obamacare with anything that works better, because any of the possible improvements directly contradict the Republican ideology.

Let’s call this Republican replacement plan Abominablecare. Has a familiar ring to it, doesn’t it?

I strongly suggest that all you insurance companies and large employers who don’t want to be torpedoed by Abominablecare immediately contact your favorite bought and sold Republican legislators and tell them to scrap this nonsense post haste.

Tell them it’s only going to get in the way of the bigger agenda, which is giving you more undeserved tax breaks and regulatory relief. A health care plan is a small price to pay, after all, for the freedom to fleece the American public on every other product and service they have to buy from you to survive. Give them some doc visits so you can jack up the rents you charge for housing, phone, TV and internet service, gasoline, heating oil, public transportation (where it still exists), and education. And since you’re already paying them off to allow you to ramp up the pollution of our air, water and food by removing all the regulations that protect us, maybe it will keep your victims quiet if they at least can go to a hospital for treatment when they fall ill at increasingly early ages. O yeah. They’ll die sooner too, by the tens of thousands. Maybe that’s how the Republicans actually plan to bring down the cost of health care.

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Jeff Sher is a journalist specializing in the health care industry. He lives in San Francisco.

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