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insurance industry
Why the GOP Healthcare Plans Won't Fill the Prescription
Individual Choice, Cherry-Picking the Pool, and Screwing Cancer Survivors
The Republicans in Congress, along with Trump on alternate days, are pushing plans that are supposed to give choice to individuals and somehow take it away from insurers. It’s not clear what they think they are saying. They seem to still envision that people will buy insurance, as they do now in the Obamacare exchanges, but somehow that they will have more control in the Republican option.
There is one story they could envision, which would make it much easier for insurers to skew their pool. The Affordable Care Act (ACA) restricted what sort of plans could be offered in the exchanges in order to limit the ability for insurers to avoid high-cost individuals.
It would be possible to relax these restrictions to allow insurers to cherry pick their enrollees. For example, they could offer high-deductible plans, say $15,000 in payments, before any coverage kicked in.
The Republican healthcare plan is a rerun of the bluff and lie strategy they have been doing for more than 15 years.
No person with a serious health condition would buy this sort of plan since they know they would be paying at least $15,000 a year in medical expenses, and then a substantial fraction of everything above this amount, in addition to the premium itself. On the other hand, a low-cost plan with $15,000 deductible might look pretty good to someone in good health, whose medical expenses usually don’t run beyond the cost of annual checkup.
The Republicans can look like the great promoters of individual choice by allowing insurers to market these high-deductible plans. The problem is that healthy people will all gravitate to high-deductible plans, leaving only the people with serious health issues—the 10%—to buy plans with more modest deductibles.
These plans will then be ridiculously expensive since insurers are not going to insure people at a loss. If they have a pool with four or five times the average per person healthcare costs, they will charge a premium that is four five times the average cost, plus a margin for administrative costs and profits. This means that cancer survivors, people with heart disease, and other serious health conditions will be screwed, given the option of ridiculously expensive insurance or none at all.
Been There, Done That
The most painful part of this story is that we have all been around the block many times on this story. Unless Trump and the Republicans are extremely ignorant, which can never be ruled out, they are simply lying and hope that the media will let them get away with it. They have no brilliant plan to lower healthcare costs. They are simply proposing a scheme that will lower premiums for healthy people by screwing the ones who need healthcare most.
It amounts to lowering costs by not providing care. It’s like reducing the cost of food by not letting people eat. But if the point of a healthcare system is to provide people with the healthcare they need, the Republican proposals are nonstarters.
As a practical matter, contrary to what the Republicans and the media say, healthcare cost growth did slow sharply after Obamacare passed. That may not have been entirely due to Obamacare, but that is the reality. Too bad the Democratic consultants tell Democratic politicians not to talk about it.
The Real Source of High Costs
We do pay way too much for healthcare in the United States, but it is not because of Obamacare. We pay twice as much for our drugs, medical equipment, and doctors as people in other wealthy countries. These high payments persist because they are supported by powerful lobbies.
Some of us had hope that the Trump administration might take some steps to reduce these prices, especially in the case of drugs, since RFK, Jr. had railed against corruption in the pharmaceutical industry. Unfortunately, his tirades were limited to an evidence-free crusade against long-proven vaccines, which are not even a major source of profit for the industry.
Donald Trump talked about reducing drug prices 1,500% (really), but this mostly amounted to getting his name on a drug discount website for a small group of patients. We were spending 6.4% more on drugs in September of this year than in the same month in 2024. (September is the most recent month for which data are available.)
Trump has shown no interest in doing anything to lower the cost of medical equipment. And he has said nothing about lowering doctors’ fees, although some reshuffling of the Medicare reimbursement schedules may reduce overpayments to specialists and better pay for family practitioners. His immigration policies are going the wrong way here, making it even more difficult for foreign-trained medical students and doctors to practice here.
And there are the insurers themselves, which gobble up close to 25% of the money they pay out to providers in the form of administrative costs and profits. A recent study found that If we add in the cost imposed by insurers on hospitals, doctors’ offices, and other providers, they take up close to a third of healthcare expenses.
Trump has shown no interest in reining in the insurance industry apart from his silly talking point about giving people money directly to… wait, wait, buy their own unregulated insurance. That will do nothing to reduce the money flowing into the industry’s pockets.
The Republican healthcare plan is a rerun of the bluff and lie strategy they have been doing for more than 15 years. Given the right-wing control of much of the media, it could work for them politically. The tragic part of the story is that millions could end up without the healthcare they need.
It’s Time to Be Honest About What Caused the Texas Floods: Fossil-Fueled Climate Change
A Year of Climate-Driven Catastrophes, With More To Come
The floods in Hill Country, Texas are only the most recent in a devastating string of climate disasters across the U.S. in the last year alone.
In September 2024, Hurricane Helene killed more than 200 people in North Carolina and drenched the Southeast with 20 trillion gallons of rain—50% more than would have fallen without climate change, according to experts.
This January, wildfires swept across Los Angeles, killing 30 people in what were some of the most destructive fires in the city’s history. Fueled by extreme heat, record winds, and historic drought—conditions exacerbated by climate change, the fires were a reminder of the human causes and consequences of global warming and the disasters it fuels. The smoke may lift, but the consequences will linger, reshaping lives and landscapes for years to come.
Every moment we stay silent about climate change, we sink deeper into a fossil-fueled future defined by disaster.
In March, a deadly tornado outbreak tore through much of the Midwest and South, killing 42 people. It was the largest tornado outbreak ever recorded for the month of March, again, made more likely by a warming climate.
Just two months later, in mid-May, a severe tornado outbreak struck the Midwestern and Southeastern United States, spawning 60 tornadoes and claiming 27 more lives.
Tornadoes emerge from powerful thunderstorms, and climate change is making these storms more frequent and more intense. As the atmosphere warms and holds more moisture, the conditions that fuel tornadoes—like those seen in March and May—are arriving earlier, occurring more often, and leaving behind more destruction.
Despite the relentless and deadly reminders of climate change, the U.S. administration remains in denial. Just last week, they replaced hundreds of scientists and experts working on the federal government’s flagship climate impacts report with known climate skeptics.
The Texas Floods, The Cost of Climate Denial
Just a month before the floods, NASA released new research showing a sharp rise in the intensity, frequency, duration, and severity of extreme weather events—including floods—over the past five years. The Texas floods are another example of the devastating extreme weather events fueled by rising temperatures and human-caused climate change.
The fatal Texas flooding began with torrential downpours that overwhelmed the Guadalupe River and its tributaries. In a matter of hours, more than 10 inches of rain fell, causing the river to rise nearly 29 feet in less than an hour. This kind of extreme rainfall has become far more likely in our warming world.
As Andrew Dessler, a climate scientist at Texas A&M University, put it, “Climate change is like steroids for the weather—it injects an extra dose of intensity into existing weather patterns.” Global temperatures have already risen 1.5°C, on average. Warmer air holds more water vapor, enabling bigger downpours and more intense rainfall. At least 1.8 trillion gallons of rain fell over the impacted area.
Arsum Pathak, director of Adaptation and Coastal Resilience at the National Wildlife Federation, explained it simply: “The atmosphere is like a giant sponge. As the air gets warmer, which is what’s been happening because of climate change, the sponge can hold a lot more water. And then when there’s a storm, the same sponge can squeeze out way more water than it used to.”
In Texas, warmer temperatures mean storms like this one are now up to 7% wetter than during similar storms in the past. The region has experienced a 21% increase in total precipitation on the heaviest rainfall days since the 1950s. These are no longer theoretical risks; they are lived realities.
Playing the Blame Game
Many politicians and officials have been quick to blame the severity of the flooding on the federal administration’s weakened civil service and cuts to disaster response agencies. It is true that hollowing out of the National Oceanic and Atmospheric Administration (NOAA) and Federal Emergency Management Agency (FEMA) has left communities less prepared and protected. But we cannot lose sight of the bigger picture.
Don’t let the preparedness debate distract us from the real question: Why do we need this level of preparation in the first place?
Climate change.
In all the chatter about preparing for extreme weather, “climate change” has barely been uttered by federal, state, or local officials from either political party. Indeed, like challenges to preparedness, efforts to raise climate change as a contributing factor have been met with tired accusations of “politicizing a tragedy.” But as Nobel laureate Paul Krugman rightly argues:
Now is exactly the time to put officials on the spot… if we don’t make an issue of how this happened… nothing will be learned and nothing will change.
Texas Gov. Greg Abbott dismissed the idea of blame, calling it a word for “losers” before pivoting to football metaphors. But unless climate change becomes part of the game plan, Texans—and all Americans—will continue to lose.
It’s All About Climate Change
To ignore the fact that global warming amplified this flood is to invite the next storm—wetter, hotter, and deadlier. Every moment we stay silent about climate change, we sink deeper into a fossil-fueled future defined by disaster.
The Fossil Fuel Industry is Driving Disaster
The science is undeniable. Greenhouse gases are at their highest concentration in at least 800,000 years, and fossil fuels are their primary driver. 2024 was the warmest year on record, with the global average near-surface temperature 1.55°C above the preindustrial average. The last decade was the warmest ever documented.
Who Pays?
The deadly floods in Texas will cause an estimated $18 billion to $22 billion in damage and economic loss. But it won’t be the fossil fuel companies footing the bill. It will be ordinary Texans‚ families already grieving lost loved ones and livelihoods.
The Insurance Industry Contributes to Climate Change, But Avoids Its Consequences
As the waters recede, many flood victims will discover they won’t be insured for the damage. Standard homeowners’ insurance doesn’t cover flooding. Separate flood insurance, often prohibitively expensive, isn’t always required, and only a fraction of Texans carry it.
Across the 21 counties included in Gov. Abbott’s disaster declaration, only 10% of homeowners carry federal flood insurance. In Kerr County, the worst-hit area where 95 people died, just 2% of homeowners hold federal flood insurance. In neighboring Kendall County, it is less than 5%.
The tragic loss of life in Texas was undoubtedly fueled by climate change—and climate change is driven by the fossil fuel industry.
Homeowners can purchase a separate flood insurance policy from a private insurance provider, but it is expensive, and the coverage is limited. It’s not yet clear how many Texas flood victims held separate private flood insurance as an add-on to their homeowners policy.
The residents facing the greatest climate-related vulnerabilities, including those living in RVs, mobile homes, or informal housing, face even greater risks. Several RV and mobile home parks in Central Texas were swept away by floodwaters, highlighting how those with the fewest resources are often forced to live in the most dangerous places.
And yet, the insurance industry—an industry that invests billions in fossil fuel companies and underwrites fossil fuel projects—continues to fuel the climate crisis while shielding itself from its financial impacts. Insurers raise premiums, limit coverage, or leave disaster-prone areas altogether, but they remain heavily invested in the fossil fuel economy that’s driving these disasters.
The Path Forward: Accountability and Action
The tragic loss of life in Texas was undoubtedly fueled by climate change—and climate change is driven by the fossil fuel industry. The fossil fuel industry must be held accountable for its contribution to the floods in Texas—and other fossil-fueled climate catastrophes.
Insurance companies must also be called to account. They cannot claim to be managing climate risk while actively financing and underwriting the industries that create it. State insurance regulators should require insurers to divest from fossil fuel companies and stop insuring fossil fuel projects. And responses to the climate-driven insurance crisis should prioritize the needs of residents on the front line of fossil-fueled climate disasters, not insurers’ bottom line.
Extreme weather events will continue to escalate until we confront their root cause. State and local leaders hold the keys to both prevention and recovery. It’s time for them to face reality and protect the people they serve.
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