FRIDAY, JANUARY 6, 2017
Donald Trump says Republicans should repeal the Affordable Care Act immediately, and replace it with new legislation “shortly thereafter.” House Speaker Paul Ryan claims Republicans will try to repeal and replace the law “concurrently.”
No chance. At least not if they want to avoid the specter of over 20 million Americans stranded without health insurance.
Repeal of Obamacare without replacement by an equivalent or better program will deny life saving care to millions – tens of thousands of whom will die of preventable or treatable conditions.
But Republicans can’t and won’t replace Obamacare, for three big reasons.
First, Republicans say they want their replacement to be “market-based.” But Obamacare is already market based – relying on private, for profit health insurers.
That’s already a problem. The biggest health insurers – Anthem, Aetna, Humana, Cigna, and United Health – are so big they can get the deals they want from the government by threatening to drop out of any insurance system Republicans come up with. Several have already dropped out of Obamacare.
Even now they’re trying to merge into far bigger behemoths that will be able to extort even better terms from the Republicans.
Second, every part of Obamacare depends on every other part. Trump says he’d like to continue to bar insurers from denying coverage to individuals with preexisting conditions.
But this popular provision depends on healthy people being required to pay into the insurance pool, a mandate that Republicans vow to eliminate.
The GOP also wants to maintain coverage for lower-income Americans, but they haven’t indicated how. More than 80 percent of Americans who buy health insurance through Obamacare receive federal subsidies. Yet Republicans have no plan for raising the necessary sums.
Which gets us to the third big reason Republicans can’t come up with a replacement.
Revoking the tax increases in Obamacare – a key part of the repeal – would make it impossible to finance these subsidies.
The two biggest of these taxes – a 3.8-percentage-point surtax on dividends, interest and other unearned income; and a 0.9-percentage-point increase in the payroll tax that helps fund Medicare – are also the most progressive. They apply only to people earning more than $200,000 per year.
Immediately repealing these taxes, as the GOP says it intends to do, will put an average of $33,000 in the hands of the richest 1 percent this year alone, and a whopping $197,000 into the hands of the top 0.1 percent, according to the Tax Policy Center.
The Center on Budget and Policy Priorities estimates that the 400 highest-income taxpayers (with incomes averaging more than $300 each) would each receive an average annual tax cut of about $7 million.
It would also increase the taxes of families earning between $10,000 and $75,000 – including just about all of Trump’s working class voters.
Worse yet, eliminating the payroll tax increase immediately pushes Medicare’s hospital fund back toward the insolvency that was looming before Obamacare became law.
Ultimately, the only practical answer to these three dilemmas is Medicare for all – a single payer system. But Republicans would never go for it.
So without Obamacare, Republicans are left with nothing. Zilch. Nada.
Except the prospect of 20 million people losing their health insurance, a huge redistribution from the working class to the very rich, and tens of thousands of avoidable deaths.
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