ACA Not Good Enough for All Americans

Too many Americans still can’t afford health insurance even after passage of the Affordable Care Act and four million have lost their subsidies on the through Exchanges over the last four years. A recently released study by the Kaiser Family Foundation shows that particularly older and rural folks find it hard to afford individual insurance whether on the Affordable Care Act Exchange markets or not.

Part of the problem is that Exchange subsidies cut off federal assistance for premiums at incomes at 400 percent of the poverty line, or nearly $49,000 for an individual and just over $100,000 for a family of four. Rather than phasing out by reducing the subsidy gradually the subsidy just disappears, lending the phenomenon the name "subsidy cliff." The Kaiser study uses this example: "On average across the U.S., a 40-year-old making $45,000 would pay $227 a month (6% of their income) for a subsidized bronze exchange plan, whereas the same person making $50,000 would pay $340 a month (8% of their income) for the same plan without a subsidy."

And if you’re older it goes from bad to worse: "a 27-year-old making $50,000 would pay 7% of their income in premiums for the average lowest-cost plan nationally, whereas a 60-year-old making the same income would pay 17% of their income in premiums. Even at an income of $70,000 (577% of the poverty level), a 60-year-old would have to pay 12% of income for a low-cost plan on average."

Rural areas get hit even harder since health insurance there is even more expensive. The Kaiser study provides this example of a 60-year-old in almost any county in Nebraska, earning $50,000 and paying between 30 percent and 50 percent of their income in premiums. And that's for the least expensive, ACA-compliant plans.

There are several ways to deal with the problem. One way is to eliminate the subsidy cliff by adjusting the subsidy so that the premium paid by the insured is never more that 6% of their income. That’s an expensive solution. A better way would be to expand Medicare to cover people 50 and older. Even better is the Medicare For All Act of 2019 introduced last week by Representatives Debbie Dingell, Pramila Jayapal, and co-sponsored by over 100 other members of Congress.

Our current healthcare system in the United States is ineffective, inefficient and outrageously expensive. Around 70 million Americans are uninsured or cannot afford the costs of their co-pays and deductibles. The quality of our healthcare is worse than other industrialized countries with lower life expectancy in the U.S. than other nations, and a much higher infant mortality. The U.S. spends more money per capita on healthcare than any other industrialized nation in part because we waste hundreds of billions of dollars every year on unnecessary administrative costs like insurance CEO salaries in the millions of dollars, while healthcare industry executives measure success in profits, instead of patient care.

When the Franklin Roosevelt administration created Social Security conservatives fought it but the lives of millions of older Americans were improved immediately and seniors have continued to benefit from it 80 years later. When Medicare was passed under the leadership of Lyndon Johnson conservatives fought it, Ronald Reagan even made speeches calling it socialism, but again millions of older Americans lives were improved and seniors today recognize their lives would be much worse without it. Conservatives are fighting Medicare for All but it will improve the lives of tens of millions of Americans and save us and our country billions of dollars at the same time.

Published in the Seguin Gazette - March 8, 2019