A Plan Set Up To Fail

The structure of the Affordable Care Act comes out of a straightforward analysis of the logic of coverage. If you want to make health insurance available and affordable for almost everyone, regardless of income or health status, and you want to do this through private insurers rather than simply have single-payer, you have to do three things. 

1.Regulate insurers so they can’t refuse or charge high premiums to people with preexisting conditions
2.Impose some penalty on people who don’t buy insurance, to induce healthy people to sign up and provide a workable risk pool
3.Subsidize premiums so that lower-income households can afford insurance.

 The GOP proposal basically accepts the logic of Obamacare. It retains insurer regulation to prevent exclusion of people with preexisting conditions. It imposes a penalty on those who don’t buy insurance while healthy. And it offers tax credits to help people buy insurance. Conservatives calling the plan Obamacare 2.0 definitely have a point.

But a better designation would be Obamacare 0.5, because it’s really about replacing relatively solid pillars with half-measures, severely and probably fatally weakening the whole structure. 

First, the individual mandate – already too weak, so that too many healthy people opt out – is replaced by a penalty imposed if and only if the uninsured decide to enter the market later. This wouldn’t do much.

Second, the ACA subsidies, which are linked both to income and to the cost of insurance, are replaced by flat tax credits which would be worth much less to lower-income Americans, the very people most likely to need help buying insurance.

Taken together, these moves would almost surely lead to a death spiral. Healthy individuals, especially low-income households no longer receiving adequate aid, would opt out, worsening the risk pool. Premiums would soar – without the cushion created by the current, price-linked subsidy formula — leading more healthy people to exit. In much of the country, the individual markets would probably collapse.

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Any plan that combines "Republican" and "care" is lying.  

They don't.

They won't.

And they will never admit that we're all in this together and need to stand up for each other.

Absolutely, Jerry. 

"we're all in this together and need to stand up for each other."

~ Jerry Wesner 

Republicans are trying to put forward something that will convince the distracted that "See, we can give you health care too."  But the cost will doom it; many can't afford to join; others will bet that they'll stay well.  Then, when it collapses, they can say "See?  Government shouldn't get involved with health insurance!"

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