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GOP Health Care Plan Would Cause 24 Million to Lose Health Insurance by 2026

GOP Health Care Plan Would Cause 24 Million to Lose Health Insurance by 2026

A new report released on March 13, 2017, by the non-partisan Congressional Budget Office (CBO) finds that the GOP Plan “The American Health Care Act (AHCA)” would be devastating for Californians. According to the CBO analysis, 14 million people nationally would lose their health coverage in 2018, increasing to 24 million in 2026. The GOP Plan would cut federal Medicaid funding by $880 billion over the next 10 years resulting in a 17.6 percent decrease in federal spending for the program forcing states to make hard choices about whether services to children, seniors, persons with disabilities or pregnant women will be cut. 

Rather than rushing to pass legislation that would wipe out health care for 24 million people, California’s Congressional Delegation should find solutions that build on the progress we’ve made. Any replacement plan should expand coverage, reduce health care costs, and maintain protections so that Californians have the health care and economic security we need. We have glimpsed the future in California with better health for our communities under the ACA and we refuse to roll back progress.

To view the full CBO report, visit the Congressional Budget Office website. The GOP plan is now consolidated into one bill, read the full text here

Highlights of the March 13th CBO score:

  • 24 million people will lose access to affordable health care coverage. The House Republicans’ proposal to repeal the Affordable Care Act (ACA) would lower the number of Americans with health insurance by 24 million over the next decade. The impacts will be immediate with 4 million people losing their health insurance coverage in 2017 and 10 million more by 2018 primarily as a result of the repeal of the individual mandate. The CBO expects some will forgo insurance without the penalty, others would forgo insurance because of the anticipated immediate rise premiums. Moving forward, the number of uninsured is expected to rise to 21 million in 2020 and then 24 million in 2026. This additional 10 million uninsured is due to changes in Medicaid enrollment as states could decide to eliminate their Medicaid expansions and begin to implement the proposed per-capita-cap on enrollee spending (a set amount of funding per enrollee regardless of the actual cost of care).
  • States will have to make tough decisions about coverage for the vulnerable. The biggest impact will be in Medicaid where the federal government expects to cut spending by $880 billion over the next ten years. In California 3.7 million childless adults will be at risk of losing their comprehensive health care coverage. A many as 14 million Medi-Cal enrollees including pregnant women and children, seniors and persons with disabilities will be at risk of losing their coverage, or facing significant reductions in services if the Republican’s plan to restructure the Medicaid program is approved.
  • California’s low-income and seniors will see large increases in their health care premiums in 2019 and beyond. The CBO analysis finds that the proposed GOP Plan tax credits reduce assistance by 40% of what is currently offered under the ACA.[1] Financial assistance would range between $2,000 and $4,000 and are based upon age rather than income, meaning that low-income individuals could lose thousands of dollars in financial help to pay for coverage. Currently, 90% of the 1.5 million Californians enrolled in Covered California get financial assistance based on their income to help them afford coverage, an average tax credit is $440 a month or $5200 per year – thousands less that what the GOP is offering. In addition, older Americans will be expected to pay more because the proposal allows for plans and insurers to charge more based upon age, which means people over age 50 may pay perhaps five times more than someone who is 21 years of age.  The combination of increased premiums and less financial help means many older and low-income consumers will not be able to afford coverage.
  • The GOP plan will lead to higher health insurance premiums for Californians who purchase their coverage in the individual market. Premiums are expected to rise 15-20% in 2018 and 2019 due to repeal of the individual mandate. This will potentially lead to an unbalanced mix in the insurance markets as less healthy people will enroll. While premiums are projected to go down after 2020, this will be in part because insurers would shift costs to consumers meaning higher copays and deductibles.
  • Excludes Certain Immigrants from ACA Tax-Credits, by changing ACA eligibility rules from lawfully present to qualified immigrants. This change will unjustly exclude certain immigrants who are currently eligible for subsidies under the ACA, putting at risk many who are survivors of crime, fleeing violence and persecution, and who have urgent medical needs.
  • The requirement to have “continuous coverage” will deter at least 2 million primarily healthier people from purchasing coverage. According to the CBO, roughly 1 million people would be induced to purchase insurance in 2018 to avoid having to pay the surcharge but after 2018, roughly 2 million fewer people would purchase insurance because of the surcharge. The people deterred from purchasing coverage would tend to be healthier leading to an uneven mix within the insurance pool, and possibly leading to higher costs for everyone.
  • Funding for prevention is at risk. The GOP Plan would repeal the Prevention and Public Health Fund by 2019, which funds prevention, wellness, and public health activities to promote healthy eating and active living, tobacco control, and vaccinations. The CBO estimates that direct spending is reduced by $9 billion over the 2017-2026 period, which means that California could lose $300 million in prevention funding over the next 5 years.
  • Eliminating funding for Planned Parenthood health care costs. The GOP Plan prohibits funding for Planned Parenthood -- a deliberate assault on women’s reproductive freedom and many low-income and rural communities who receive many of their primary care services through Planned Parenthood clinics.

The CBO analysis finds that older Americans and low-income individuals will be most impacted by the GOP Plan, while healthier and higher income people will gain the most. While the federal government would save upwards of $337 Billion over the next 10 years it will be at the expense of women and children, lower income, and older communities.

[1] The AHCA provides $361 billion ($673 billion under the ACA) for a 40% reduction overall in premium and cost-sharing assistance for low-income Californians.