Katie Hill: From frying pan to fire?
Advocates for Planned Parenthood Los Angeles rally in front of Congressman Steve Knight's Santa Clarita office on May 4, 2017 after the House of Representatives passed the American Health Care Act.
By Signal Contributor
Friday, May 5th, 2017

Our own Representative Steve Knight, R-Palmdale, voted along with his party Thursday to repeal and replace the Affordable Care Act (ACA) with their own proposal, the American Health Care Act (AHCA).

I’ll be the first to admit the ACA was not perfect. Premiums are still rising, deductibles were too high, and health insurers were pulling out of public exchanges, making it hard for middle-class and working families to get the care that they needed.

Even in a Republican Congress that would be unwilling to move toward universal health care, we had an incredible opportunity to provide relief to families struggling with flaws in the ACA.

Our representatives could have looked at the cost control measures. Currently, there is a built-in incentive for insurance companies to want to pay more for services to hike up their gross revenues.

The ACA requires that insurers spend 85 percent of their premiums on medical costs for large group plans. If you’re an insurance company and you take in $1 billion in premiums (United Healthcare takes in at least 100 times that annually), you need to spend $850 million in medical care, leaving only $150 million for your administrative costs and any profit for shareholders.

So they are essentially encouraged to pay more in medical costs – drugs, hospital bills, MRIs – and pass the cost on to consumers through premium hikes. If you spend double on medical care, and double your premiums, you can take double the profits.

We need a way of incentivizing the exact opposite behavior in insurers if we are ever going to tackle the uncontrollable rising costs of health care overall.

Other solutions are possible as well. Members on both sides of the aisle could have worked to encourage more transparency and regulation in pharmaceutical pricing (but wait; those guys are big political donors, so that’s not going to happen till we deal with campaign finance reform).

We could have offered parents a tax credit to put their kids aged 18-25 on their own separate health insurance instead of their parents’ plans, which are often more robust than a healthy young person needs anyway, to get healthier young people into the exchanges.

We could have invested in innovations in mental health and drug treatment services, early intervention, and prevention to stem costly ER visits and lifelong problems and combat the opioid epidemic.

What does the AHCA do instead?

It takes Medicaid funding away from schools that rely on it to support special needs children (source: New York Times).

According to the AARP, under the AHCA, people aged 50-64 could pay up to five times as much for health insurance. (Source: CNN)

Congressman Knight justified his vote by saying those with pre-existing conditions would be protected. On one hand, that’s partially true. The bill does say that those with pre-existing conditions cannot be denied health insurance.

However, it does not put a cap on how much those with pre-existing conditions can be charged (Source: Politifact).

This puts us back at square one. Sure, those with pre-existing conditions still technically have access to health insurance, but is access really enough when you have to choose between putting a roof over your head and getting the care you need?

The AHCA deals the harshest blow to women.

Health insurance companies can hike up rates on women with pre-existing conditions, which now include being pregnant, planning on becoming pregnant, having a C-section, or experiencing post-partum depression.

What’s more, Congress passed this bill without a plan to pay for it. There’s a proposed $8 billion subsidy for high-risk patients that would be so crucial to many families with chronic illnesses, but the bill does not outline where we are going to get that money.

Like you, I’ve heard Steve Knight’s reasons for supporting this bill. His supporters seem to genuinely believe that it will lower premiums and protect those with pre-existing conditions.

However, when you have everyone from the AARP to doctors to even the health insurance companies coming out and saying this is a bad bill, when you haven’t had the time to get an analysis of what costs would be passed along to the taxpayers, and when you haven’t even had the chance to read the bill in its entirety before going to vote, I think it’s bad judgment to pass a bill with life-or-death implications for millions of Americans just to score partisan political points.

In 2010, my husband’s lung collapsed during a short period (before the ACA took effect) when he couldn’t get insurance. He was hospitalized for 11 days, had to have major surgery, and we ended up $200k in debt.

Thankfully, we were young and didn’t have a house that we could lose and we had the help of our families. But it hurt us financially for years – and we were lucky in comparison to so many affected by a lack of health insurance before the ACA.

We can’t go back to a time like that. The AHCA is bad policy, and just plain morally wrong.

 

About the author

Signal Contributor

Signal Contributor

Advocates for Planned Parenthood Los Angeles rally in front of Congressman Steve Knight's Santa Clarita office on May 4, 2017 after the House of Representatives passed the American Health Care Act.

Katie Hill: From frying pan to fire?

Our own Representative Steve Knight, R-Palmdale, voted along with his party Thursday to repeal and replace the Affordable Care Act (ACA) with their own proposal, the American Health Care Act (AHCA).

I’ll be the first to admit the ACA was not perfect. Premiums are still rising, deductibles were too high, and health insurers were pulling out of public exchanges, making it hard for middle-class and working families to get the care that they needed.

Even in a Republican Congress that would be unwilling to move toward universal health care, we had an incredible opportunity to provide relief to families struggling with flaws in the ACA.

Our representatives could have looked at the cost control measures. Currently, there is a built-in incentive for insurance companies to want to pay more for services to hike up their gross revenues.

The ACA requires that insurers spend 85 percent of their premiums on medical costs for large group plans. If you’re an insurance company and you take in $1 billion in premiums (United Healthcare takes in at least 100 times that annually), you need to spend $850 million in medical care, leaving only $150 million for your administrative costs and any profit for shareholders.

So they are essentially encouraged to pay more in medical costs – drugs, hospital bills, MRIs – and pass the cost on to consumers through premium hikes. If you spend double on medical care, and double your premiums, you can take double the profits.

We need a way of incentivizing the exact opposite behavior in insurers if we are ever going to tackle the uncontrollable rising costs of health care overall.

Other solutions are possible as well. Members on both sides of the aisle could have worked to encourage more transparency and regulation in pharmaceutical pricing (but wait; those guys are big political donors, so that’s not going to happen till we deal with campaign finance reform).

We could have offered parents a tax credit to put their kids aged 18-25 on their own separate health insurance instead of their parents’ plans, which are often more robust than a healthy young person needs anyway, to get healthier young people into the exchanges.

We could have invested in innovations in mental health and drug treatment services, early intervention, and prevention to stem costly ER visits and lifelong problems and combat the opioid epidemic.

What does the AHCA do instead?

It takes Medicaid funding away from schools that rely on it to support special needs children (source: New York Times).

According to the AARP, under the AHCA, people aged 50-64 could pay up to five times as much for health insurance. (Source: CNN)

Congressman Knight justified his vote by saying those with pre-existing conditions would be protected. On one hand, that’s partially true. The bill does say that those with pre-existing conditions cannot be denied health insurance.

However, it does not put a cap on how much those with pre-existing conditions can be charged (Source: Politifact).

This puts us back at square one. Sure, those with pre-existing conditions still technically have access to health insurance, but is access really enough when you have to choose between putting a roof over your head and getting the care you need?

The AHCA deals the harshest blow to women.

Health insurance companies can hike up rates on women with pre-existing conditions, which now include being pregnant, planning on becoming pregnant, having a C-section, or experiencing post-partum depression.

What’s more, Congress passed this bill without a plan to pay for it. There’s a proposed $8 billion subsidy for high-risk patients that would be so crucial to many families with chronic illnesses, but the bill does not outline where we are going to get that money.

Like you, I’ve heard Steve Knight’s reasons for supporting this bill. His supporters seem to genuinely believe that it will lower premiums and protect those with pre-existing conditions.

However, when you have everyone from the AARP to doctors to even the health insurance companies coming out and saying this is a bad bill, when you haven’t had the time to get an analysis of what costs would be passed along to the taxpayers, and when you haven’t even had the chance to read the bill in its entirety before going to vote, I think it’s bad judgment to pass a bill with life-or-death implications for millions of Americans just to score partisan political points.

In 2010, my husband’s lung collapsed during a short period (before the ACA took effect) when he couldn’t get insurance. He was hospitalized for 11 days, had to have major surgery, and we ended up $200k in debt.

Thankfully, we were young and didn’t have a house that we could lose and we had the help of our families. But it hurt us financially for years – and we were lucky in comparison to so many affected by a lack of health insurance before the ACA.

We can’t go back to a time like that. The AHCA is bad policy, and just plain morally wrong.