HR2300 is the incoming Secretary of Health and Human Services, Rep. Price (R-GA), PPACA replacement bill. It does lots of things. One of those things is it replaces income based subsidies with age based subsidies.
Sec. 101. Refundable Tax Credit for Health Insurance Coverage
Provides for refundable, age adjusted tax credits with amounts tied to average insurance on individual
market adjusted for inflation.1
o $1,200 for those between 18 to 35 years of age
o $2,100 for those between 35 and 50 years of age
o $3,000 for those who are 50 years and older
o $900 per child up to age 18
Besides being grossly inadequate in size, there is another problem with these subsidies. These subsidies will have massive geographic disparities. Individuals who live in low cost medical markets with large and healthy risk pools will see their subsidy cover a far higher percentage of their premium costs for a given actuarial value. Individuals who live in high cost medical markets will pay a lot more out of pocket for their premiums. Below is a map of every county on Healthcare.gov excluding Alaska. The pricing is the least expensive Silver plan with no subsidies for a forty year non-smoker. The range is significant. The least expensive Silver in the data set is thirteen counties in Texas at $199.28 per month. The most expensive non-Alaska coverage is three counties in Arizona at $754.74.
The subsidy in the price plan will let the Texas 40 year olds buy 70% AV coverage for less than $20 a month out of pocket. Given quite a few other moving parts in HR0-2300 I can’t get a firm estimate but this is a good ballpark estimate. However the subsidy for the three Arizona counties for a forty year old would be sufficient to buy 25% AV coverage and the individual is paying $500 out of pocket every month.
We’ve talked about county level inequities within PPACA through Silver Gapping and Silver Hacking
More importantly, people in Perry County who are getting subsidized will see the ACA working really well. They have good, cheap health insurance. However their cousins across the state are getting a raw deal compared to the great deal that they get in Perry County. This is especially true as we move up the income scale which means moving up the likely voter scale and influence scale.
The people in the cheap Texas counties will see the Price plan as a great deal, especially higher up the income scale as the current subsidies fade out and then fall off a cliff. The people who make under 400% FPL in Arizona will be getting a raw deal.
Thanks for this rotten information. Makes me sad, but I will help spread the word about why Price is a rotten choice with even worse plans.
I serious doubt we’ll ever see this kind of thoughtful analysis in the Times or from any MSM source. WASF.
Interesting. Basic guaranteed income for old, wealthy people with job-based insurance?
Thanks for the info, Richard. I’ll pass this along.
I just want to keep the insurance I have. Ugh.
Ghost of Joe Liebling's Dog
@Mathguy: We’ll see it in the Times after the bill’s passed. That way the next time the issue is raised in Congress we’ll have this valuable information.
(A CBS News producer explained to me that “it’s our job to explain these things now” when I asked about the post-election coverage they were giving to things they hadn’t previously touched. “So that we’ll have this information before the next election?” I asked. “Yep!”)
This is age discrimination, right?
@Baud: Since tax credits are used to lower one’s tax liability does that mean that medical coverage tax credit will be applied at the end of the year for a possible refund sometime in January or February covering expenditures that were made a year earlier by people who couldn’t afford to make those expenditures in the first place?
@rikyrah: Not any more than charging an 18 year old male more for automobile insurance then charging a 50 year old female
Some discriminations are useful and allowed.
That 50 and older group is a pretty broad band of ages and needs. By the time I hit 70+, the rates will probably be equivalent to “Sign up for one year and get your first month free!”
Major Major Major Major
I would have expected the opposite, a plan to prop up the rural parts of the country at the expense of liberals and minorities–but then again, that would resemble helping the poor.
I know I’m a bit paranoid, and a lot cynical, but won’t something like this make universal health really unpopular with the people who get stiffed? As in, make sure government doesn’t work so we can run on a platform of “government doesn’t work.”
Details, details. Who needs messy details? Just get rid of that bad Obamacare, OK? I guess that is the correct response.
He’s only the next secretary of HHS if the Senate confirms him. We need to keep working to make that not happen.
those Arizona counties are a really eclectic mix, heavy reservation representation and retirees and libertarian rancher types. Makes me wonder how they came up with how THOSE people ended up getting the shittiest end of the stick.
Massachusetts will revert to Romneycare and my state will probably roll out Browncare or Newsomcare, but both states will eventually be hurt by blockgranted and declining Medicaid payments.
So, do most people. Sadly, that’s not what Trump/Price/Ryan will be offering.
This reflects the GOP’s need to punish poor people.
The last time the GOP sunk its teeth into health care legislation they created the mess that is Medicare Part D with its infamous and totally idiotic “doughnut hole.” You have to be really stupid to come up with something like that, but the Republicans seem to have a lot of similarly terrible ideas.
I think their usual calculations decide what the largest number of really screwed people can be without electoral repercussions. In the US, with its ignorant and stupid electorate, that number is distressingly large, which gives the GOP wide latitude to create horrible legislation.
Those subsidy numbers are so low that I almost don’t need to see any of the rest of the details before assuming that the plan is ass. Not that I was thinking for a second that a Republican PPACA replacement bill wouldn’t be ass, but it’s nice to be able to skip the deep dive.
They will almost certainly have another huge problem — the rate of inflation set for subsidies will be well below the rate of inflation for healthcare costs in general. Year after year the subsidies will buy less and less. To the GOP that isn’t a bug, it’s another wonderful feature.
And don’t forget old people. We don’t know yet how badly the GOP will deal with us. If they voucherize the whole program — present and future recipients — then states that create their own _?_care programs will be further devastated by the sickest and most expensive age cohort. All the numbers I’ve ever seen for the voucher show it to be wholly inadequate, not only at first (like their subsidies), but getting worse over the years as the vouchers’ rate of inflation is set well below the rate of healthcare inflation. These are stupid and very dangerous people.
Doesn’t the name Jerrycare seem like the obvious choice?
Gavincare sounds elitist.
And the AARP was a huge (yuuuge!) cheerleader for passing Medicare Part D because its prescription program stood to gain large profits. Which is why this 55+ year old will NEVER join the AARP.
Scarily informative map — btw, Hawai’i is also missing from it. Not sure what would happen here under such a scenario but my guess is it won’t be positive.
@SC54HI:My map is only so big. Looking at Hawaii they are plug in the middle at about $375 for the case example.
@Baud: The refundable bit caught my eye too, a while back. Universal, without means testing, whether you need it or not – that what you want in a government program. Social security has no means testing and Medicare only does it around the edges, and their very universality makes these programs popular and (probably) untouchable. All this stuff about paying for rich kids’ college or, in this case, rich people’s medical care is nonsense – as long as the taxes that pay for it all are progressive. Heck, you could argue whether the ACA would have been better off with non-means-tested subsidies coupled with an explicit progressive payroll tax. But the “optics” seem to never allow Dems to propose non-means-tested programs.
3Jane Tessier-Ashpool (a/k/a Lorinda Pike)
My husband had the courtesy to wait until he was enrolled in Medicare to acquire throat cancer. One treatment – not the entire three-month regimen – but ONE DOSE of his chemo billed at $3,200. That, times twelve, was just for the chemo. Forget radiation three time a week, two oncologists, and his throat doc. Without his being on Medicare, we would be on the street right now. And we have little debt, own our home, and have a decent savings account for “emergencies” like when the paid-for vehicle blows a gasket or something. We have been responsible, and have tried to do everything right. That would ALL be gone now.
How the hell do these people think that a convoluted “tax credit” is going to pay for healthcare?
And why this aging has never joined AARP. My earliest objection to AARP was that it championed benefits or programs for the elderly even when those were bad for the country as a whole. Just because I became elderly doesn’t mean I don’t still object to that kind of nonsense.
So basically this is a tax credit for anyone in the individual market who can afford to buy insurance and has nothing to do with making health care accessible to everyone. Hey, if some poors “choose” not to buy insurance they can’t afford it’s their “choice” to miss out on the benefit, but it was so unfair that the benefit phased out for higher incomes before. Now it’s fixed! Republicans are greedy, horrible people. And how much is this going to cost while exacerbating the meaninglessness of being an American?
Just for my own sanity check – are those tax credit numbers annual? Because here in the Epicentre of Fraudulent Liberal Voting, aka California, until last month, my 53 yo husband and I (52 yo) had a Covered California silver plan with a monthly premium of about $1300 ($650 each). Since we were both out of work for most of the year, our monthly, subsidized, premium was $150 each. So am I correct in calculating that under this “plan”, we’d each have to pay $400 each? ($650-($3,000/12) = $400).
I must be missing something. Because how in the world is it possible that any non-wealthy 70 yo old could afford coverage? I just looked on the marketplace and the Kaiser HMO Bronze plan for a 64 yo is $760/mo with a $4,800 deductible. So they’d have to pay $500/mo? How much for a 70 yo? The average Social Security benefit is $1,300 month, how does ANYONE without a lot of assets come up with enough money?
In my previous question, I was (probably wrongly) assuming that Medicare was converted to the same level of tax credits as HR2300. But the question’s still valid for someone under 65 without significant income/assets…
Isn’t this biased towards the rural counties? I suppose that’s the point.