Wednesday, March 08, 2017

County-level data finds that many rural areas would be hurt most by GOP health-insurance plan

Analysts say House Republicans' bill to replace the Patient Protection and Affordable Care Act could cost millions of people to lose health insurance and would largely hurt people in areas where coverage is high, predominately rural areas where there are few hospitals or few insurers, Abby Goodnough and Reed Abelson report for The New York Times.

While official numbers are not available on the number of people who would lose coverage, "a report from Standard & Poor’s estimated that two million to four million people would drop out of the individual insurance market, largely because people in their 50s and early 60s—those too young to qualify for Medicare—would face higher costs," reports the Times. "Other analysts, including those at the left-leaning Brookings Institution, have estimated larger coverage losses." (Kaiser Family Foundation county map of tax credits under ACA vs. the American Health Care Act in 2020. Blue areas are where tax credits are smaller under House plan. For an interactive version click here)
"Starting in 2020, the plan would do away with the current system of providing premium subsidies based on people’s income and the cost of insurance where they live. Instead, it would provide tax credits of $2,000 to $4,000 per year based on their age," reports the Times. "But the credits would not cover nearly as much of the cost of premiums as the current subsidies do, at least for the type of comprehensive coverage that the Affordable Care Act requires, analysts said. For many people, that could mean the difference between keeping coverage under the new system and having to give it up."

"The proposal would also eliminate another important element of the subsidies, the financial assistance available for low-income people with their out-of-pocket costs, such as deductibles and co-payments," reports the Times. "While many of the plans now sold through the Affordable Care Act marketplaces have large deductibles, the cost-sharing reductions available protect lower-income people from medical bills that could otherwise run into the thousands of dollars. Analysts say the lack of out-of-pocket assistance is likely to make any plan much less attractive to low-income people."

"Legislation could also fundamentally weaken the insurance market by doing away with the so-called individual mandate, which requires people to have coverage or pay a tax penalty," reports the Times. "While it would be replaced by a 30 percent surcharge when someone buys a policy after dropping coverage, the surcharge could be weaker than the current mandate, and younger people might continue to gamble on not having coverage until they get sick. The result, said Donald H. Taylor Jr., a health policy professor at Duke University, is that people who buy coverage are sicker, causing the cost of premiums to soar."

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