How The Republican Plan To Scrap Obamacare Helps Some, Hurts Others The GOP leadership's plan to repeal and replace the Affordable Care Act would generally be better for younger, healthier and richer people.
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The Winners And Losers In The Republican Health Care Plan

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The Winners And Losers In The Republican Health Care Plan

The Winners And Losers In The Republican Health Care Plan

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Medical and consumer groups alike are warning that millions of people could lose their health care if Republicans make good on their promise to scrap the Affordable Care Act. But as their legislation makes its way through Congress, President Trump is saying pay no attention to the critics. Trump tweeted this afternoon that the end result will be, quote, "a beautiful picture." NPR's Scott Horsley reports what that picture looks like depends on where you're standing.

SCOTT HORSLEY, BYLINE: Every insurance system relies on a basic bargain. People pay in during good times so they can draw out when times are tough. With health insurance, people in good health subsidize those who are less so. And since none of us knows when we might get sick, we play along.

Obamacare adds two more subsidies to that basic formula. Young people are asked to pay more for insurance so older people can pay less, and the wealthy pay additional taxes to help cover costs for the poor. By undoing those subsidies, the Republican replacement plan would shift costs from young to old and rich to poor. The forecasting firm S&P Global estimates on balance, 6 to 10 million people might lose insurance coverage. But S&P director Deep Banerjee says more young people would likely sign up.

DEEP BANERJEE: We expect gains from individuals in the age group of 21 to 35 but losses from individuals in the age group of 45 to 64.

HORSLEY: That's because the Republican plan allows insurance companies to offer stripped-down policies that would be cheaper and more attractive for young people even as the price of policies for older customers goes up.

A typical 21-year-old, for example, might be able to find coverage for around $2,600 dollars a year, most of which could be paid for with a $2,000 tax credit from the government. But a 64-year-old trying to buy insurance might have to pay five times as much, and the maximum tax credit in the GOP plan of $4,000 would cover less than a third of that.

BANERJEE: Two-thousand dollars for someone in their 20s does go a long way, which is why we think there will be more people in that age group who can afford it and will sign up. But the 3,500 or 4,000 for somebody in the 50s and 60s really doesn't go a long way.

HORSLEY: So young people win, and older people lose under the GOP plan. There are regional variations as well. Unlike Obamacare in which subsidies are based on actual insurance costs in a given area, tax credits in the Republican plan are the same all over the country. That's good for people living where health care and insurance costs are low, trouble everywhere else.

The American Medical Association and the American Hospital Association have come out against the Republican plan. Both groups say they're worried about what would happen to the 20 million people who got coverage thanks to the Affordable Care Act.

KAREN TEITELBAUM: People who are just getting used to having care may feel that they don't have a choice now in terms of primary care physicians and good prenatal care.

HORSLEY: Karen Teitelbaum is CEO of Sinai Health System which operates four safety-net hospitals in Chicago. Before the Affordable Care Act, about 15 percent of her patients were uninsured, and the system spent $50 million a year on charity care. Both those figures have been cut in half thanks to Obamacare. Teitelbaum says Sinai's been able to invest the savings in preventive health measures and improve treatment for mental illness, programs that could be in jeopardy under the GOP plan.

TEITELBAUM: We're going to have to perhaps cut back on services if the plan really rolls back coverage for those most in need because those are the very people that we see.

HORSLEY: So safety-net hospitals and their patients could be losers. Big winners include the wealthy. Obamacare is funded in part with extra taxes on people making more than $200,000 a year. Roberton Williams of the nonpartisan Tax Policy Center says scrapping those taxes would put tens of billions of dollars back in the pockets of the wealthy.

ROBERTON WILLIAMS: It's almost all the very richest tax payers. And the bulk of the money is coming from people in the very top 1 percent, people with incomes over about $700,000 a year.

HORSLEY: Republican House Speaker Paul Ryan wants the House to pass the repeal and replace bill within weeks. Scott Horsley, NPR News, the White House.

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