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Congressional health plan is a bad prescription

Speaker of the House Paul Ryan (R-Wisc.), center,

Speaker of the House Paul Ryan (R-Wisc.), center, holds up a copy of the American Health Care Act during a news conference. Credit: Getty Images

The war over the federal government’s role in health care historically has played out between two diametrically opposed groups that battle in the messy middle. On the left are the single-payer adherents who believe everybody in the country ought to have benefits paid for by the government. On the right are those whose fundamental belief is that everybody in the country ought to pay for his or her own care.

Now these factions are coming together in opposition to the new Republican health care plan. They are joined by hospitals, including almost every provider on Long Island, and doctors, including the American Medical Association. That’s because this GOP plan makes a lot of crucial things worse and hardly anything that matters better.

n Medicaid would be decimated over time as states begin to get a set amount of money per recipient in 2020, rather than a reimbursement based on costs. Harsh enrollment limits would kick in as well. The combination would cost New York at least $4 billion a year, and unless benefits were severely cut back, that money would come out of other programs or result in higher taxes. New enrollees covered under Obamacare income guidelines would have to stay on the program without interruption to remain eligible, incentivizing continued government dependence. Medicaid has more than 70 million enrollees and about two-thirds of its spending is for elderly, blind and disabled people. More than half of all long-term nursing home care in the United States is paid for by Medicaid.

n The new plan would devastate Medicare by eradicating a fair tax. Nearly all wage earners pay 2.9 percent of their paychecks to Medicare taxes. The tax had always been solely on income earned through work, not from investments. Obamacare fixed this escape hatch for the wealthy by applying that 2.9 percent tax to investment income, but only for families earning more than $250,000. There is also an extra 0.9 percent tax on the passive income of super-high earners. The new bill would eliminate both taxes, saving the top 0.1 percent of earners about $165,000 a year per filer while moving the date Medicare will go bankrupt years closer. How would that help the middle class?

n The new plan would eliminate the individual mandate, replacing fines for those who don’t buy insurance with a 30 percent, one-year surcharge on people who once had insurance but let it lapse. That would guarantee that no one would ever re-enroll until he or she became very ill.

n The proposal would massively increase the cost of insurance for older enrollees. Now insurance companies are prohibited from charging older people more than three times what they charge younger ones who use less care. That ratio would increase to 5 to 1.

n No one is sure what the changes in coverage would cost the nation, because the Congressional Budget Office hasn’t analyzed it yet. But, GOP leaders hope to rush votes on the bill to applaud themselves for doing something, hoping no one reads the fine print. Experts estimate the tax reductions alone would cost the Treasury $594 billion over 10 years.

The Republican bill still faces negotiations in both chambers of Congress. It could improve, but at the moment, it’s hard to see how the bill could be much worse, and it’s puzzling that President Donald Trump would adopt it as his own and call it “wonderful.”

The plan, under which it’s estimated 6 million to 10 million people would lose coverage, does not repeal Obamacare or replace it. It just decimates the funding streams and the coverage by enriching the nation’s wealthiest people and penalizing its most vulnerable.— The editorial board


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