In an effort to blunt the American Health Care Act’s disastrous effect on older Americans, House Republican leaders are adding a provision that would set aside $75 billion to do ... something unspecified.
Really. According to Politico, the new version of the bill will not say at all what to do with the $75 billion. Instead it will just “instruct the Senate” to come up with a plan to use the money to help people between the ages of 50 and 64.
This is a very unusual way to legislate and reflects House Republicans’ desperation to push through basically anything as soon as possible and pass the buck to the Senate.
The underlying issue is that the Affordable Care Act provides people earning less than 400 percent of the poverty line with sliding-scale subsidies to purchase health insurance. The less you earn, the more help you get. The ACA also limits insurance companies’ ability to charge older customers higher premiums than they charge to younger ones.
AHCA changes the subsidies around, ensuring that everyone who makes less than $75,000 a year gets a subsidy that’s based on age. The older you are, the more help you get. This leaves the neediest families out of luck — the subsidy isn’t enough to buy an insurance plan if you’re just barely above the poverty line regardless of your age, so they would end up going uninsured and get nothing from the government at all.
But even though older people get more generous subsidies, they are worse off than before too. That’s because AHCA allows insurers to charge older people as much as five times what they charge younger ones, so older people’s premiums will skyrocket far beyond anything the subsidy can deliver.
The result is a health insurance system that really only works for relatively young, relatively affluent people.
Older people are the Republican base, however, so a bill that badly damages their financial interests is a political problem for many House Republicans. Coming up with an actual fix to this problem is not conceptually impossible. But it would require a pretty substantial rethink of the underlying architecture of the AHCA, which is designed, on a deep level, to better serve the interests of people who don’t need much help while doing less to serve the interests of those who do.
But Paul Ryan is determined to have the House vote on this bill on Thursday, which means they don’t have time for any big rethink or prolonged negotiation. So what they’ve come up with instead is, apparently, this $75 billion magic asterisk. The House will pass a bill with what amounts to a blank spot, and then members can say they repealed Obamacare and toss the hot potato of working out the details to their colleagues in the Senate.
