By Robert Reich
Republicans are
preparing to repeal the Affordable Care Act, and have promised to replace it
with something that doesn’t leave more than 20 million Americans stranded
without health insurance.
But they still haven’t
come up with a replacement. "We haven’t coalesced around a solution
for six years,” Republican Senator Tom Cotton admitted last week. “Kicking the can
down the road for a year or two years isn’t going to make it any easier to
solve.“
They won’t solve it.
They can’t and won’t replace Obamacare, for three big reasons.
First, Republicans say
they want their replacement to be “market-based.” But Obamacare is already market
based – relying on private, for profit health insurers.
That’s already a
problem. The biggest health insurers – Anthem, Aetna, Humana, Cigna, and United
Health – are so big they can get the deals they want from the government by
threatening to drop out of any insurance system Republicans come up with.
Several have already dropped out of Obamacare.
Even now they’re
trying to merge into far bigger behemoths that will be able to extort
even better terms from the Republicans.
Second, every part of
Obamacare depends on every other part. Trump says he’d like to continue to bar insurers from
denying coverage to individuals with preexisting conditions.
But this popular
provision depends on healthy people being required to pay into the insurance
pool, a mandate that Republicans vow to eliminate.
The GOP also wants to
keep overall costs down, but they haven’t indicated how. More than 80 percent of Americans who buy health insurance
through Obamacare receive federal subsidies. Yet Republicans have no plan for
raising the necessary sums.
Which gets us to the
third big reason Republicans can’t come up with a replacement. Revoking the tax
increases in Obamacare – a key part of the repeal – would make it impossible to
finance these subsidies.
The two biggest of
these taxes – a 3.8-percentage-point surtax on dividends, interest and
other unearned income; and a 0.9-percentage-point increase in the payroll tax
that helps fund Medicare – are also the most progressive. They apply only to
people earning more than $200,000 per year.
Immediately repealing
these taxes, as the GOP says it intends to do, will put an average of $33,000
in the hands of the richest 1 percent this year alone, and a whopping $197,000
into the hands of the top 0.1 percent, according to the Tax Policy Center.
It would also increase
the taxes of families earning between $10,000 and $75,000 – including just
about all of Trump’s working class voters.
Worse yet, eliminating
the payroll tax increase immediately pushes Medicare’s hospital fund back toward the insolvency that was looming before
Obamacare became law.
Ultimately, the only
practical answer to these three dilemmas is Medicare for all – a single payer
system. But Republicans would never go for it.
So without Obamacare,
Republicans are left with nothing. Zilch. Nada.
Except the prospect of
more than 20 million people losing their health insurance, and a huge
redistribution from the working class to the very rich.
ROBERT B. REICH is Chancellor's Professor of Public Policy at
the University of California at Berkeley and Senior Fellow at the Blum Center
for Developing Economies. He served as Secretary of Labor in the Clinton
administration, for which Time Magazine named him one of the ten most effective
cabinet secretaries of the twentieth century. He has written fourteen books,
including the best sellers "Aftershock", "The Work of
Nations," and"Beyond Outrage," and, his most recent, "Saving
Capitalism." He is also a founding editor of the American Prospect
magazine, chairman of Common Cause, a member of the American Academy of Arts
and Sciences, and co-creator of the award-winning documentary, INEQUALITY FOR
ALL.
