Written by Aaron D. Fox, MD, MS, past NPA Copello Health Advocacy Fellow, New York City
After Rep. Tom Price, a former orthopedic surgeon, was nominated to be Secretary of Health and Human Services, commentators – including leaders of the American Medical Association – highlighted how his experience as a physician made him a good candidate for role. But physicians have historically been on the wrong side of health care reform (remember, the AMA opposed the creation of Medicare), and Dr. Price’s experience in practice may give him an idea about the needs of physicians, but his ideas certainly don’t have the best interest of sick or low-income patients in mind. As a primary care physician, I’m worried about what will happen to my patients, who already struggle affording their medications, if the Affordable Care Act (ACA) is repealed. Reading Dr. Price’s plan for replacing Obamacare (HR2300: Empowering Patients First Act), has made it very clear to me that Dr. Price values reducing government spending and protecting the incomes of health care providers more than “empowering” patients. Here are the things we should all be worried about:
1. All of the gains of Medicaid expansion could be lost. Arguably, the most important aspect of the ACA was expanding Medicaid (the public health insurance program for low-income individuals) in states that chose to take advantage of newly available federal funding. It’s estimated that 12.3 million Americans gained coverage through Medicaid or the Children’s Health Insurance Program. States, like Kentucky, which expanded Medicaid have had both health benefits and economic benefits. This means check-ups and management of chronic diseases for people who may not have previously had access to care. But what worries me most is that we’re in the midst of an opioid overdose epidemic, and Medicaid is often the only way that low-income individuals can afford treatment. If Medicaid expansion is lost with ACA repeal, and people with opioid use disorder lose access to treatment, it could cost many lives.
2. A $1200 tax credit will not make health insurance affordable. On page 1 of the overview of Dr. Price’s plan, the amount of the proposed tax credit jumps right out at you: $1200 for those between 18 to 32 years of age. The section is ironically titled, “Tax incentives for Maintaining Health Insurance Coverage (Makes it financially feasible for all to purchase coverage they want for themselves and their families – not that Washington forces them to buy).” I read this provision along with four other physicians and we all burst out laughing. What kind of health insurance can you buy for $1200? Young people may not consume much health care, but what about maternity care? Mental health care? Type I diabetics? The tax credit goes up to $3000 for those who are 50 and older, but before the ACA, health plans available to individuals averaged about $4500 dollars, covered less than Obamacare plans, and individuals with pre-existing conditions couldn’t even get insurance. I have a hard time believing that tax credits will make insurance “financially feasible.”
3. High-risk pools will not protect sick patients. Before the ACA, people with pre-existing conditions could not purchase health insurance in the so-called “individual market.” Health insurers either wouldn’t offer plans to people who would need regular medical care or the plans would be prohibitively expensive. This is why we needed the ACA’s protections! The Kaiser Family Foundation has estimated that 27% of adults less than 65 years old (the age when people become eligible for Medicare) have a pre-existing condition that would make them uninsurable again if the ACA was repealed and we returned to the same standards of pre-ACA medical underwriting. Because people with pre-existing conditions couldn’t purchase health insurance, states were left to create “high-risk pools” to subsidize insurance for those with high needs. However, the pools were expensive, only covered a fraction of those in need, and premiums were often unaffordable for low-income individuals. If someone with diabetes can’t afford the premiums in a high-risk pool, and they develop a complication, how will they get treatment before it’s too late? Bringing back a system that previously didn’t work for “high-risk” patients is the opposite of patient empowerment.
4. The limitations on Employer-Provided Health Care Coverage could have broad impact. One of the least popular parts of the ACA is the “Cadillac Tax” for high cost, employer provided health plans. It hasn’t actually kicked in yet, but starting in 2018, plans with a value of more than $29,100 for families or $10,800 for an individual will be stuck with a 40% excise tax. This was intended to hold down health care costs by creating a disincentive to firms offering very comprehensive insurance. You see, employers don’t pay taxes on their contributions to employees’ health benefits, therefore they may offer comprehensive insurance as part of compensation packages (instead of higher salary, which they’d need to pay tax on). This becomes a problem for health care spending, because if health insurance pays for everything, people may consume more health care than necessary. All of this may make sense to health economists, but employees and unions negotiated for these comprehensive health benefits and were unhappy with the excise tax, which will they’d end up paying in the end. Well, Dr. Price’s plan lowers the limits for tax exclusions of employer-provided health insurance to $20,000 for a family and $8000 for an individual, making additional contributions to health benefits taxable as income. President Obama was criticized for saying that if you like your insurance you can keep it. Dr. Price better not try to do the same.
5. Protecting health care providers’ salaries. Physicians work very hard and are often saddled with a huge amount of debt. However, the average orthopedic surgeon made more than $500,000 in 2015 (which was 10X the median household income). Even lower paying specialties like family medicine or pediatrics made more than $200,000. For Dr. Price to spend any real estate in his “Empowering Patients First Act” on protecting physicians’ salaries is a slap in the face to Americans who struggle to find stable employment. There are provisions to remove limits on charges that Medicare beneficiaries can be billed by health professionals, but it’s not clear why this is necessary.
6. Health Savings Accounts (HSAs) are not health insurance. There are several provisions incentivizing savings with HSAs. This isn’t a bad thing, but HSAs are not health insurance. You buy health insurance because you cannot always predict when you will get sick with a major illness. Even if you raise the maximum pre-tax contribution into health savings accounts, people will still go bankrupt if they develop cancer or have a major accident. If this is the patient empowerment part of the bill, I’m still unimpressed.
7. “Death Panels” for malpractice claims. In 2009, Sarah Palin claimed on Facebook that her parents or baby with Down Syndrome would need to go before “Obama’s ‘death panel’ so his bureaucrats can decide…whether they are worthy of health care.” This was the Politifact lie of the year; nonetheless, critics continued to complain about the ACA creating government bureaucracies that stand between patients and their doctors. As a physician, I’ve always felt like it was health insurance companies that were standing between me and my patients, but that’s a separate issue. The point is that there were never government death panels and there never will be. But the “Empowering Patients First Act” does create a new government bureaucracy called “Health Care Tribunals” with special judges to hear malpractice lawsuits. This won’t dictate standards of medical care, but it could reduce patients’ abilities to receive compensation when they are harmed by inadequate or inappropriate medical care. According to the proposal, first, a panel of experts (at least half of whom are health care providers) would review a case and decide whether there was “gross negligence.” Health care providers, who remember their own errors, tend to be reticent in calling out the mistakes of others. But creating a legal standard of demonstrating “gross negligence” is more problematic, because it may end up setting a burden of proof that is too high for most patients to receive compensation. It’s telling when anti-government legislators are willing to develop additional bureaucracy to protect their own special interest, but there are better ways to foster necessary tort reform without harming patients.