Leaked Draft of ACA Replacement Reveals Massive Cuts to Subsidies, Medicaid

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Leaked Draft of ACA Replacement Reveals Massive Cuts to Subsidies, Medicaid

Just as polls reveal Obamacare and Medicaid expansion are more popular than ever, GOP moves closer to slashing subsidies and raising taxpayer costs—adding fuel to brewing protests nationwide

A protest sign at the Women's March in Los Angeles on January 21, 2017. (Photo: Larissa Puro/flickr/cc)

A leaked draft of a House bill to replace the Affordable Care Act (ACA) was published Friday by Politico, and it reveals that Republicans are moving towards slashing subsidies and ending the Medicaid expansion—moves that are vastly out of step with the opinions of the American public.

The draft (pdf) reveals that Republicans are hoping to "take down the foundation of Obamacare, including the unpopular individual mandate, subsidies based on people's income, and all of the law’s taxes. It would significantly roll back Medicaid spending and give states money to create high risk pools for some people with pre-existing conditions. Some elements would be effective right away; others not until 2020," per Politico's Paul Demko.

The bill would also eradicate the Medicaid expansion that some states enacted when the ACA was first passed in 2010. This means that states that took advantage of federal funds to expand Medicaid would no longer have access to such funds.

Echoing state-level GOP attempts to withhold funds from Planned Parenthood, the law also appears to explicitly ban federal funding for the women's health organization, Business Insider notes: "Under the bill, no funding from the federal government given to the states could be given to any organization that 'provides abortions' except in the cases of rape, incest, or the life of the mother."

Moreover, the legislation would help private insurance companies profit even more than they already do, as it gives in to insurers' desires to force elderly people to pay more for healthcare. It would "charge older customers up to five times as much as their younger counterparts," Demko notes.

"The proposal also includes penalties for individuals who fail to maintain coverage continuously," writes Demko. "If their coverage lapses and they decide to re-enroll, they would have to pay a 30 percent boost in premiums for a year."

And instead of subsidies based on income to help low-income people afford costly premiums, the law would give tax credits based on age. A person under 30 would receive a tax credit of $2,000, while someone over 60 would receive double that amount. "A related document notes that HHS Secretary Tom Price wants the subsidies to be slightly less generous for most age groups," Demko reports.

The subsidies will be funded by capping "the tax exemption for employer sponsored insurance at the 90th percentile of current premiums," Demko notes, a plan similar to the proposed "Cadillac tax" pushed by President Barack Obama and opposed by unions and progressives nationwide.

Overall, the plan would cover fewer people than Obamacare—contrary to President Donald Trump's promises. "We're going to have insurance for everybody," Trump told the Washington Post just last month. "There was a philosophy in some circles that if you can't pay for it, you don't get it. That's not going to happen with us."

In fact, the draft demonstrates that the Republican party is woefully out of step with public opinion when it comes to healthcare. The disparity was particularly noticeable as it was released on the same day as polls that showed support for the ACA has never been higher.

A Kaiser Family Foundation poll discovered that a stunning 84 percent of respondents want to keep the Medicaid expansion, and a Pew Research Center poll also revealed majority approval for the ACA for the first time in the law's history. Earlier this week, a Politico poll also found support for the ACA growing.

The swelling support for the ACA has coincided with the looming fulfillment of the Republican Party's long-touted promise to repeal and replace the law.

The disparities between the GOP's plans and public sentiment, which has fueled tensions at Republican politicians' town halls across the country, could also add urgency to "Hands Off Our Healthcare" rallies in support of publicly-funded healthcare happening nationwide Saturday. 

Interested in fighting back against the GOP plan to dismantle health care? Find a rally near you here.

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