Briefing Book

A Hidden Harm of the Obamacare Replacement

The GOP plan will force you to pay more just as its cuts make you sicker.

By Bob Kocher, MD

Tagged Affordable Care ActHealth CarePublic HealthRepublicans

The central premise of the Republicans’ American Health Care Act (AHCA) plan is to force Americans to pay more for their health care or, as Republicans would say, have “more skin in the game.” Put another way, the AHCA drastically increases the cost of health care for all Americans. By providing subsidies that are too small and exclude income adjustment, poor people will, at best, be able to buy plans with extraordinarily high deductibles and low actuarial values (e.g, $20,000 deductibles). It will be even worse for Medicaid beneficiaries, since the shift to per capita caps will force states to cut coverage as well as enrollment. As a result, this bill will leave millions of the most vulnerable people unable to afford premiums; if they do manage to gain “access” to insurance, cost sharing will be so onerous that they will not actually be able to receive care.

But it gets worse. Section 101 of the AHCA demolishes public health funding. Specifically, it strips $20 billion from the Prevention and Public Health Fund, which is a huge part of our public health investments. Public health is critical. These investments are designed to reduce disease burden and demand for health care in the future. Yet, collectively, they represent only 3 percent of U.S. health-care spending. This bill, therefore, represents the worst possible combination of cuts. Since Republicans are proposing to eliminate health insurance coverage for millions, and make care more expensive for all, allowing Americans to get sicker faster is a very bad strategy.

The Prevention and Public Health Fund is making a big difference. It is the money behind Alzheimer’s disease services for seniors, the Million Hearts program to prevent cardiovascular disease, stroke prevention, and notably, $325 million for childhood vaccinations. It is jaw dropping that Republicans would raid these funds considering their very high near-term and long-term return on investment.

It is also very likely that Health and Human Services will strip out the preventive care requirements of the Affordable Care Act that enable all Americans to get free access to cancer screenings, chronic diseases screenings, and vaccinations. While these investments add only a few dollars to insurance premiums, they go a long way toward lowering future costs through prevention and early identification of diseases, when they are at their most treatable—and when they are most affordable to treat.

Finally, we know that people without insurance are at least 25 percent more likely to die prematurely. If the AHCA translates into pre-ACA levels of such deaths, this would mean adding at least 20,000 avoidable deaths a year. If the AHCA is enacted, America will once again duke it out with developing countries for access to health insurance, watch our mortality rate increase, and fall further behind on chronic disease care by stripping out the public health investments that we need to bend the cost curve downward and reduce disease burden. This will be particularly poignant for poor people and older people who will face the highest cost-sharing increases and who are in the greatest need of well-functioning public health investments.

Read more about Affordable Care ActHealth CarePublic HealthRepublicans

Bob Kocher, MD is a Senior Fellow at the USC Schaeffer Center for Healthcare and Economic Policy, a Partner at the venture capital firm, Venrock and formerly Special Assistant to the President for Healthcare and Economic Policy.

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