Health insurance policy was not a major topic during a presidential campaign dominated by talk of immigration, inflation, reproductive rights, and threats to democracy. The issue’s main appearance was during the September debate, when Trump made his much-ridiculed remark about having “concepts of a plan” to replace the Affordable Care Act.
Now it turns out that Republicans have chosen healthcare as one of their priority issues as they prepare to assume full control of Congress. The Washington Post reports that GOP lawmakers and Trump advisers are discussing significant cuts in Medicaid—both the traditional part of the program designed to provide coverage for those in poverty as well as the expansion to middle income families that made up part of Obamacare.
This would serve several purposes. First, the purported savings would make it easier to gain support for an extension of the 2017 tax cuts scheduled to expire at the end of next year. Extending the giant giveaways to corporations and the wealthy would add an estimated $4 trillion to the national debt. Offsetting some of that with Medicaid reductions would allow Republicans to depict themselves as fiscally responsible.
It would also fit into the campaign being spearheaded by Elon Musk to give the impression that the new administration is going to do something about government waste.
There is no indication, however, that either Musk or Congressional Republicans intend to target the real culprits behind any wasteful spending in the Medicaid system: improper and fraudulent billing by healthcare providers and the inflated prices of prescription drugs.
Instead, the crusade against Medicaid will apparently focus on the phony issue of work requirements. This is the same scheme used by conservatives for decades to undermine safety net programs: make exaggerated claims about abuse and use this to justify complicated new eligibility rules that are designed to eject large numbers of beneficiaries. In the case of Medicaid, this will be coupled with cuts in the subsidies that make premiums more affordable for those receiving coverage through the ACA exchanges. Millions of people would have to drop out of their plans.
Reducing government costs for traditional Medicaid and ACA subsidies is just one part of the Republican strategy. The other aim is to push people from government programs entirely and place them at the mercy of the private insurance marketplace.
Trump’s concept of a plan is not entirely fiction. He and other Republicans do have an alternative to Obamacare: junk insurance. Their idea is to replace the decent coverage mandated by the ACA with bare-bones policies that are inexpensive but which provide little in the way of actual financial protection.
This is nothing new. Starting in the 1990s, large insurers such as Aetna, now owned by CVS, began selling such policies to low-income individuals who did not get employer coverage and could not qualify for Medicaid. These policies had low premiums but sky-high deductibles and numerous exclusions. In cases of a serious accident or illness, they were all but worthless. The ACA curbed this predatory market by establishing a set of essential benefits that most plans would have to include.
During the first Trump administration, Congressional Republicans repeatedly sought to abolish or cripple the ACA and allow junk insurance to return. They now seem poised to work with Trump 2.0 to try it again.
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