The Republican health care bill limping through the U.S. House is a nonstarter for Florida. Its impact on seniors, children, low-income residents and workers in the state's large tourism industry poses a great risk to public health and the state's economy. And the specter of instability for the state's safety net hospitals could cause a dramatic pullback in critical care in the major urban areas of the nation's third-largest state. This is a plan that favors the healthy and wealthy on the backs of the neediest.
A report by the nonpartisan Congressional Budget Office released last week estimates the American Health Care Act would result in 14 million fewer people with health care coverage next year and 24 million fewer by 2026. Most of that change would come from repealing penalties associated with the individual mandate in Barack Obama's Affordable Care Act to buy insurance, and from changes in subsidies for individual policies and in Medicaid enrollment. In 2026, an estimated 52 million people would be uninsured, or 19 percent of the population under age 65, compared to 28 million who would lack insurance that year under current law, or about 10 percent of the non-elderly population. The pain would be particularly acute here in Florida, the leading ACA state, with 1.7 million people enrolled.
The legislation would reduce federal deficits by $337 billion over the 2017-26 period. And while average premiums would typically increase prior to 2020, the CBO estimates they would drop thereafter, and by 2026, average premiums would be about 10 percent lower than under current law.
But the savings would come from cuts to Medicaid and new pricing and benefits schemes that would especially impact Florida's elderly and low-income populations. Under a new age-rating rule, insurers could charge older enrollees five times more for coverage — rather than three times more as currently allowed — thus subsidizing insurance for younger, healthier enrollees at the expense of older residents. The AARP estimates that 454,000 older Floridians, those in their 50s and 60s, would see premiums rise.
A 21-year-old making $26,500 a year would pay premiums of $1,450, down from $1,700 under the Affordable Care Act, while an older person with the same income would see rates climb to as much as $14,600 from $1,700 a year. While the CBO estimates a broad increase in the number of uninsured, people between 50 and 64 years old and with lower incomes would be hit especially hard. By 2026, premiums would be up to 25 percent lower for a 21-year-old and 10 percent lower for a 40-year-old, but 25 percent higher for a 64-year-old. That's not good economics for a state like Florida with its large retiree population.
Some 4.3 million children, pregnant women and disabled and low-income Floridians who depend on Medicaid would be hurt, too. Because states would pay for a greater share of each enrollee's costs, CBO expects that no additional states would expand Medicaid, thus limiting enrollment and spending. While the impact would be modest in the short term, CBO estimates that on an average annual basis, 5 million fewer people would be enrolled in Medicaid by 2026 than the number under current law.
And the cuts would hurt low-income and working people across the board. For many low-income people, the tax credits in the plan would be smaller than the tax credits under current law. According to the CBO, a 21-year-old earning $21,100 today would be eligible for a premium tax credit in 2026 of about $3,400 under current law; that would fall to $2,450 under the House bill. And again, seniors would be hard hit. An analysis by the Kaiser Family Foundation estimates the value in lost tax credits to a 60-year-old earning $60,000 a year would be $1,690 in Pasco County and $1,380 in both Pinellas and Hillsborough counties. Average subsidies under the bill would be below what's available under current law, and they would grow more slowly, too, amounting by 2026 to about 50 percent of what is currently available.
While the Republican bill staves off some cuts to hospitals that serve large populations of uninsured patients, the cuts in Medicaid and the rising ranks of the uninsured will test safety net hospitals. Many of these facilities are critical-care providers of last resort, and they are struggling already with thin profit margins and the need to reduce costs and shift expenses to paying patients. This legislation is bad for Florida virtually across the board. It does not recognize the needs of a large and growing state or the human and economic benefits of having a healthy population.