Obamacare Is In Danger, What Does That Mean For You?

Win McNamee/Getty Images News/Getty Images
Share

After seven years, of unclear promises, we finally saw Monday afternoon the Republican plan to replace Obamacare. The bill is in somewhat of a spot of trouble. The American Health Care Act (AHCA) is facing opposition not only from Democrats who are upset that it will cut taxes for the rich while cutting healthcare for the poor,  as well as from many Republicans who are upset that it preserves the Affordable Care Act's basic structure.

That structure — giving subsidies to encourage Americans to buy health insurance, regulating the insurance industry to require coverage of pre-existing conditions, and incentives to healthy people to buy into the market, spreading the risk and costs around — are still in place, but they're all changed to benefit different people. As with any government policy, especially healthcare, there are winners and losers to this bill. Depending on who you are, you may benefit from the changes in the AHCA, or lose out. Whether you are currently employed, where you live, how old you are, and, of course, what gender you will affect how you benefit or hinder your insurance coverage under the AHCA.

I've outlined some of the factors below to help you prepare if this less than popular proposal goes into effect:

Do You Get Health Insurance From Your Employer?

The AHCA gets rid of the employer mandate, which required businesses of a certain size to provide full-time employees. For the most part, a lot of businesses were already doing that pre-2010 (when Obamacare was passed), so chances are this won't change things that much. The Brookings Institution estimates about two million Americans could lose health insurance if the mandate is repealed. Many Republicans have long argued that repealing the employer mandate could lead to more hiring and more hours for workers, as companies would no longer be forced to start offering health insurance if they make a part-time employee full time, or hire enough employees to qualify for the mandate.

But for the most part, this change is not expected to affect the vast majority of the nearly 156 million people who get insurance through their job. For the rest of this piece, I'm going to focus solely on how the changes will affect the half of the country that doesn't.

How Old Are You?

Two of the biggest changes between Trumpcare and Obamacare are based on how healthcare is priced for older people and younger people. The subsidies under the AHCA would be based on age, whereas under the current Affordable Care Act they're based on income (with some changes based on costs of plans, which I'll address below). Under the Republican plan, younger people would get less money, regardless of how much money they have, and older people would get more, regardless of how much money they have. This is based on the fact that health care becomes more expensive as people get older — people develop more permanent conditions, and many illnesses affect older people. You can see that on the above chart from the Kaiser Family Foundation, a nonprofit that provides healthcare analysis.

But this isn't actually a good deal for old people.

First of all, for those under 250 percent of the federal poverty line ("FPL" in the chart above), who received subsidies under Obamacare, they'll still receive less than they did under that system. Poor old people will come out terribly.

But more importantly, AHCA changes the rules for how health insurers can charge consumers. Under the ACA, health insurers could only charge older people a maximum of three times what they charge young people, which increased costs for young people in order to ensure that older people don't have to pay more. Under AHCA, that changes to five-to-one, raising the costs significantly for many older Americans.

The AARP has taken a stance staunchly opposed to this change, calling it an "age tax" and running ads against it.

But hey, if you're young and healthy, your costs will probably go down. Not bad!

And if you're under 26, and therefore still able to be covered under your parents' plan after the changes from this healthcare plan, this won't actually affect you at all until you get older.

Where Do You Live?

The Kaiser Family Foundation chart I included before shows a difference under the Affordable Care Act in the amount of subsidies paid out between Reno, Nevada and Mobile, Alabama. This is because subsidies under Obamacare are calculated as a percentage of the cost of coverage in your area, not a flat amount nationwide. Under the AHCA, subsidies are based solely on age.

This matters because health costs can be massively different in different communities. I live in Brooklyn, New York. There are several world-class hospitals within a five mile radius. There are literally millions of patients and thousands of doctors, meaning that getting specific patients the specific care they need is relatively cheap and easy due to economies of scale.

There's something strange going on here — Trumpcare seems to target Trump voters for cuts in federal funding. For many, voting for Trump was, strangely enough, voting to personally pay more for healthcare.

Meanwhile, in rural Alaska, where much of the state is comprised of large swaths of uninhabited wilderness punctuated by minuscule villages that aren't even accessible by road, it is notably more difficult to get residents quick access to medical care, as much of it depends on helicopter airlifts to the nearest adequate medical center. The costs of ensuring quick and effective medical care in these two areas are vastly different. Obamacare was tailored to address this discrepancy, with subsidies reflecting the costs of plan in an area. Trumpcare doesn't care.

So, if you live in a relatively affluent city, you're probably going to be fine. Your healthcare costs may even go down. If you live in a rural area, you could see your costs go up massively.

There's something interesting at play with regards to the changes affecting older, and rural Americans. These are precisely the people who voted most for Trump. There's something strange going on here — Trumpcare seems to target Trump voters for cuts in federal funding. For many, voting for Trump was, strangely enough, voting to personally pay more for healthcare.

Are You A Woman?

The biggest change with regards to gender many expected from the Republican health care bill actually didn't materialize — the Obamacare regulation that said insurers couldn't charge women more than men remains intact. If you want to buy birth control and you have health insurance, it's still covered without a co-pay.

But the AHCA still could lead to big impacts on women's health outcomes, in ways that may make many women unhappy. The plan refuses tax credits to any insurance plan that includes abortion, and cuts of any reimbursement to a health clinic that provides abortion. That's right, the AHCA defunds Planned Parenthood.

The impact of this could be massive — not only will access abortion be cut off from millions, especially those who can't afford it, but defunding Planned Parenthood and similar women's health clinics could limit access to women's health care these places offer. When Texas cut funding for Planned Parenthood in 2011, the maternal mortality rate in the state doubled.

How Much Money Do You Make?

If you're low-income enough to be on Medicaid, nothing happens... yet. Trumpcare doesn't technically cut Medicaid, as some in the GOP have been calling for. But it provides a blueprint for slowly shrinking the program.

It would "freeze" enrollment in Medicaid expansion in 2020, stopping new people from signing up from the program, but letting people stay on it until they leave the program. This will slowly shrink the rolls.

But, as conservative health care commentator Philip Klein notes, there's a very real possibility that Congress will end up pushing this back in the future. 2020 is an election year, and having to explain why people are losing access to healthcare on the campaign trail isn't fun for members of Congress or the president.

Also in 2020, the AHCA would shift the structure of Medicaid from its current system, where a combination of federal and state funds guarantee medical coverage, regardless of cost to a per-capita system, where states are given a certain amount of money from the government based on how many people they enroll in Medicaid. Republicans argue that this allows states to experiment in different ways to keep health care costs down, but some health care experts contend that they would amount to cuts to the program, notably reneging on a central early promise from Trump's campaign for president.

On the other side of the spectrum, if you are very very very wealthy, this bill is awesome for you. One of the biggest set of changes from Obamacare to Trumpcare is tax cuts in the health industry. According to the Committee for a Responsible Federal Budget, those tax cuts amount to $594 billion. Almost all of these tax cuts would go to the very top earners in America. There are many people who have much to gain or lose from this bill, but the people who have the most to gain are certainly the ones who probably worry about affording their health insurance least.