By Randy Hoak
The new revised health care bill known as the American Health Care Act (AHCA), which passed the House last month, may be hazardous to our health. In an effort to educate people regarding the contents of the AHCA, the following information is helpful in understanding how the legislation would affect millions of people.
Reduces Revenue for Medicare. Reducing Medicare’s revenue creates the likelihood that Medicare will be unable to pay full benefits several years sooner than currently projected. That could lead to benefit cuts and open the door to a voucher system, putting seniors at risk and ending guaranteed benefits for future enrollees.
Doesn’t reduce cost of prescription drugs. Since 2006, prescription drug costs have doubled. The new health care bill wouldn’t help lower costs, but would provide $200 billion in tax breaks to pharmaceutical companies, insurance companies, and other special interests.
Reduces Medicaid funding by $839 billion. More than 17 million low-income seniors, children, and adults with disabilities rely on Medicaid. Millions of low-income seniors and people of all ages with disabilities may lose access to critical services, including home and community based services. New Yorkers would be hit especially hard because the state has one of the most extensive Medicaid programs in the nation.
Millions will lose health insurance. The Congressional Budget Office (CBO) estimates that 24 million people will lose their health care coverage within a decade.
Jeopardizes essential health benefits. The new legislation permits states to receive waivers allowing insurance companies to eliminate coverage for critical essential benefits, such as emergency services, hospitalization, prescription drug coverage, mental health services, chronic disease management, and preventive care.
Imposes an age tax. States would be permitted to allow insurers to charge older adults five times what younger people pay for health insurance. The AHCA would also, in most cases, reduce tax credits that help older adults afford coverage. The CBO estimates the combination of these changes—the “age tax”—could increase premiums by about $13,000. States could also receive a federal waiver allowing insurers to charge more than five times what younger people pay. New York state’s “community rating” law currently prohibits disparities in premiums based on age, and the revised AHCA tax credits will therefore have a mixed impact on New Yorkers. However, the AHCA would create greater uncertainty for the future of New York’s law.
Allows insurers to charge much higher premiums for preexisting conditions. 25 million people ages 50 to 64 with a preexisting condition, such as diabetes, are now protected from paying more for insurance than those without a preexisting condition. The new legislation would put the 40% of those age 50-64 with a preexisting condition at risk of unaffordable premiums. The AARP’s Public Policy Institute predicts premiums could reach $25,700 annually by 2019 under the AHCA. New Yorkers with pre-existing conditions are currently shielded from excessively high premiums, but that could change.
Every American should educate themselves regarding the proposed new federal law.
About the Author: Randy Hoak is Associate State Director of AARP for Western New York. Previously, Mr. Hoak was the Erie County Social Services Commissioner. He and his family reside in Hamburg.