Data and Research Manager

8 years ago

Trump voters would be among the biggest losers in Republicans’ Obamacare replacement plan

The following article by Noam N. Levey was posted on the L.A. Times website March 12, 2017:

Americans who swept President Trump to victory — lower-income, older voters in conservative, rural parts of the country — stand to lose the most in federal healthcare aid under a Republican plan to repeal and replace the Affordable Care Act, according to a Times analysis of county voting and tax credit data.

Among those hit the hardest under the current House bill are 60-year-olds with annual incomes of $30,000, particularly in rural areas where healthcare costs are higher and Obamacare subsidies are greater.

In nearly 1,500 counties nationwide, such a person stands to lose more than $6,000 a year in federal insurance subsidies. Ninety percent of those counties backed Trump, the analysis shows.

And 68 of the 70 counties where these consumers would suffer the largest losses supported Trump in November.

In nearly 1,500 counties nationwide, such a person stands to lose more than $6,000 a year in federal insurance subsidies. Ninety percent of those counties backed Trump, the analysis shows.

And 68 of the 70 counties where these consumers would suffer the largest losses supported Trump in November.

Meanwhile, higher-income, younger Americans — many of whom live in urban areas won by Democrat Hillary Clinton — stand to get more assistance in the Republican legislation.

Faring best would be the nation’s wealthiest residents, who would see a substantial tax cut with the elimination under the House GOP bill of two levies on high-income taxpayers. These taxes — on individuals making more than $200,000 and couples making more than $250,000 — were included in Obamacare to help offset the cost of assisting lower-income Americans.

The disproportionate impact of the House Republican plan threatens to undercut one of Trump’s core promises that he would replace Obamacare with a plan that would take care of all Americans.

It could also become a serious political liability for Republican lawmakers, some of whom can ill afford to alienate the party’s electoral base at a time when Trump remains deeply unpopular among Democrats and independents.

“Republicans may seem very happy to slap their constituents in the face while picking their pockets,” said Mark Mellman, a veteran Democratic political consultant who has worked extensively in red states. “But I think they will rue the day they did this.”

Only a small share of the electorate receives Obamacare subsidies, but the loss of the aid could deprive tens of millions of a critical lifeline.

“People don’t realize that all it takes is one lost job and your goose is cooked,” said John Thompson, 59, an evangelical Christian from North Carolina.

Thompson says he voted Republican for three decades. He was let go from his work in 2013, however, and he found the only way to get health coverage was through Obamacare, whose insurance marketplaces opened in 2014.

“It literally saved my life,” said Thompson, who was diagnosed with cancer shortly afterward. Thompson is now back at work. But the Obamacare aid made him rethink his support for a political party devoted to taking the healthcare assistance away. “People like me are going to get screwed,” he said of the Republican healthcare plan. “That’s just the reality.”

The Times analysis is based on county election results compiled by the Associated Press and a report by the nonprofit Kaiser Family Foundation of the projected value of insurance subsidies in 2020 under current law and under House Republicans’ proposed alternative.

The House Republican plan is already facing fierce criticism from many patient advocates, including the AARP, whose membership includes not only seniors on Medicare but many Americans between 50 and 65.

“Older Americans need affordable healthcare services and prescriptions,” said AARP Executive Vice President Nancy LeaMond. “We are very concerned that this plan goes in the opposite direction, increasing insurance premiums for older Americans and not doing anything to lower drug costs.”

The potential impact of the House legislation is making many Republican lawmakers uncomfortable, including senators from states such as Ohio, West Virginia, Alaska and Arkansas, which have large numbers of low-income white voters who have benefited from Obamacare.

For years, Trump and other Republicans have relentlessly attacked the healthcare law for saddling some consumers with unaffordable healthcare.

But many of the areas where Trump won big have been helped most by Obamacare’s system of subsidies, which were designed to assist Americans who earn too much to qualify for government Medicaid but can’t afford to buy health insurance on their own.

The assistance helps consumers making up to four times the federal poverty level — or about $48,000 a year. About 8 million Americans who buy coverage on insurance marketplaces such as HealthCare.gov currently receive subsidies.

Larger subsidies are available for people making less money and for people living in regions of the country where health insurance is most expensive.

In Alaska, which has the nation’s highest insurance costs, a 60-year-old resident with a $30,000 income qualified this year for $21,048 in federal aid to get health insurance, according to HealthCare.gov.

That kind of assistance makes a huge difference. For example, a health plan from insurer Premera Blue Cross Blue Shield that would normally cost a 60-year-old shopper in Anchorage $1,867 a month actually costs just $113 after Obamacare subsidies.

Older, lower-income consumers can get similar savings in many rural parts of the country, largely because health insurance tends to be much more expensive in these regions as there is less competition among medical providers and insurers.

“It is kind of the reverse of what people might think,” said Cynthia Cox, an analyst with Kaiser who worked on the tax credit data.

Obamacare subsidies in urban areas have tended to be lower.

In Boston, for instance, the same 60-year-old with a $30,000 annual income qualifies this year for just a $2,520 annual federal subsidy to buy health coverage, according to Massachusetts Health Connector, that state’s marketplace.

The House Republican plan would upend this system. There would be no extra aid for low-income consumers or for residents of regions with high insurance costs.

Instead, the House plan offers a flat subsidy to people based on how old they are. Americans who are younger than 30 would get $2,000. That subsidy would increase up to $4,000 for people who are 60 or older.

This new system would result in huge losses for lower-income, older residents of many rural regions, Kaiser’s analysis shows.

In 27 Nebraska counties — all of which backed Trump — a 60-year-old shopper with a $30,000 income would see financial aid drop by $12,950 a year under the House Republican legislation.

The annual subsidy in 22 counties in Oklahoma, another Republican stronghold, would plummet by $11,970. Trump won all but one of the counties by more than 28 percentage points.

Also hit hard would be rural counties in swing states such as North Carolina and Pennsylvania that provided a critical boost to Trump in November.

In Berks and Lancaster counties, west of Philadelphia, subsidies would drop by $9,500. Trump narrowly won both Pennsylvania counties.

And in western North Carolina, which helped power Trump’s victory in that state, subsidies would fall by more than $10,000.

Trump and other Republicans say that these voters will nevertheless reap the benefits of the GOP alternative.

The president last week pledged an Obamacare replacement that would “lower costs, expand choices, increase competition and ensure healthcare access for all Americans.”

The House Republican plan would benefit older, lower-income consumers who currently get relatively small subsidies and live in a few parts of the country including areas in and around Boston and New York City, Kaiser data show.

That 60-year-old Boston shopper who would qualify for a $3,450 subsidy in 2020 under Obamacare would get a $550 bump to $4,000 under the House plan, according to Kaiser’s analysis.

The Republican legislation also would help middle-income Americans who make more than $48,000 a year. These people currently don’t qualify for assistance under Obamacare. But under the GOP plan, consumers with incomes as high as $114,000 could get subsidies (though the subsidies are smaller for people making between $75,000 and $114,000).

John McDonough, a former Democratic Senate staffer who helped write the current healthcare law, says the proposed system misses the fundamental point of targeting assistance at the neediest consumers.

“The problem facing Americans who have limited financial resources is they simply can’t afford health insurance,” he said.

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