AHCApalooza

Update: 2017-03-08
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Sarah, Ezra, and Matt discuss how to pronounce the big new Republican health law, plus analyze its content and the puzzling politics surrounding its introduction.

Following script is auto-generated by Speech to Text Technology:

sponsored by text or sound of right now a texture comes less weeds to get fourteen days of free access to your favorite magazines we saw sponsored by me and we spent a good twenty percent off your first order at me and use the com sites weeds and club w personalized Wine Club now called wink at twenty dollars off as complimentary shipping right now to try week dot com slash wounds the following podcast contains explicit language because this is that we've ever was needed to have its own eye you wanted to call it cha but there's like no justification for that ha ha ha you know maybe a seed to exist in a set of hair as he as of making health care grade again you cannot pronounce or public health gave LSU went to Hebrew school it's just the point gets caught with the parentheses around how the issue of the womb I knew the night soon from funny to pass taking the the you look into another visit to the weeds boxes Ozzie has been amply network has joined in by my colleagues Ezra Klein and Sarah clip we're going to due to overwhelming demand I mean all our episode notes so you know this is you know why some of my co hosts here for instance is talk about the staff so we didn't get into some classic tweed stuff in this episode it's going to be all caught on chow do I choose to Obamacare repeal and replace episode we got through it all but you know if he ever interested in something a little less boring our colleague boxes own Tom Vander work is launching a new podcast that you might wanna check Todd is an ex and cultural critic and he's somebody who really gets that the underpinnings of culture looks at it as a reflection of America's sub conscious and is also very technically interested in how it works how shots are framed all of that so he's got this great new podcast called I think are interesting but you can find wherever fine podcast is sold his first interviews Brian Murphy the creator of Glee creator a bunch of other great things that injection a lot of news but it's also just a fascinating look at how creative a lot of if everything's thinks about the construction of culture thinks about what ideas are being played out in it and what actually works and it doesn't I listen to this I've been listening to some the upcoming episodes to I've recorded an upcoming episode with him and it's great seizure listen to it's called I think are interesting we've another thing to plug box conversations conversations conversations with box I love conversations so this is the second box covers visions we did a first one and it is combination about I think a hundred two hundred and fifty just really interesting people coming together for two days of talks and on conference sessions I love the first one I met so many interesting people so many weeds listeners and it will be on April twenty six in April twenty seventh here in Washington D C If you want a website or go to conversations dot Vox dot com You can apply to be part of it I will taping of the weeds are really that is right that accurate decorated and well we to it so i everytime a ton of our readers I learned alot from people who do things nothing related to health care actually my favorite sessions are ones that have nothing to do with my day job and I think a lot of weeds listeners would really enjoy being part of it so go to conversations of the com to apply and hope we will see if you view that and I'll add one more thing of the switches it is taking place on about Donald James hundredth day of the broad theme is sort of policy in the Trump Paris it's going to be very weeds the conference we would love to have a bunch of there that sells meaningful to beat listeners of the show we also try to keep this a real conversation so we keep it small so good conversations the box dot com to apply search I think are interesting reading a podcast to download his podcast and now let's get into the weeds first really hoping that Sarah can help walk us through like what in like a pretty straight way what does this do like what was happening with the chicken houses just because a lot going on our break this into pieces of the buildup for the day let's begin with subsidies subsidies ok so the subsidies they stick around reduced in very different form so helps understand a CA I would also be found on the a cause so much off to them or their hands of the times of Jamaica was thrown into a campaign about the city doesn't spell that the hits I was but it's more fun to just think about it just does with his business making health care fun again yet what happens to the health care subsidies in a shoe in the Republican healthcare plan there are insurance subsidies to make health insurance more affordable however different than the subsidies under Obamacare in the law tested subsidies this means that the people who earn the least get the most help to end the kind of structured in a way where they say if you a certain amount you only have to spend X percent of your income on health care so I think if you're earning around twenty thousand dollars which is a great around between two hundred and fifty two nd percent of the poverty line you only have to spend about three percent of your income on healthcare and government is kicking whatever the rest as it doesn't matter how big the actual premium as it's just tethered your income is defined amount you can today be tethered to the actual cost of health insurance yes I think is important there have been tied to this second benchmarks over right don't really know it so you get a subsidy that would essentially make a mid level health insurance plan affordable so you write as it's not like you have any plan for this present of your income they say it would cost you three percent of your cars that say didn't come to get those mid level plan we expected to pay that much what Chip and the stats of the Obamacare subsidies work they phase out at four hundred percent of the party line about forty eight thousand dollars for an individual or think ninety six thousand on a saver family of four and enough of these numbers are burned after seven years of doing math so the bigger subsidies means tested their much bigger for poor people they don't exist for rich people Republican shift to something quite different they essentially have a flat tax credit for most people they say that everyone who earns less than seventy five thousand dollars for guests is probably somewhere around like seven or eight hundred percent of the poverty line they get the same exact amount doesn't matter view and twenty thousand forty thousand sixty thousand dollars People are getting the same tax credit and it doesn't matter what health insurance plans in the area yes this is a key visit to the Jews they do vary by age so older people get more because health insurance costs more when you're older but one of the key flaws in this plan is that health insurance costs a lot of money unless a Alaska words really expensive to deliver health care enuf to use lot of helicopters or even like a rural area it's just there's less hospitals are more bargaining power in Jensen's of caustic more actually and in a weird way it sees high cost areas like New York and DC that and of lower healthcare costs because there's much more choice it's easy to get to the doctor there's more competition between hospitals so the tax credit to the Obamacare plan their only adjusted by age under seventy five thousand dollars is no geographic adjustments no income adjustment and seventy five thousand dollars they start to phase out I believe by ten percent over each thousand dollars you earn until the end when every kind of like run out of the tax credit and how big is what what is the maximum tax credit and about as American taxpayers four thousand dollars for people who are over sixty four thousand yeah yeah and how much for younger people you know if they think it's to the Lowe's two thousand people under thirty what can you buy for the year twenty seven year old in Chicago well you by looking for us Urban Institute is an exact study like vessel in the Bloomberg there she looked at this question like How far to his credit sketchy oh if you're like twenty or twenty one you can actually you can buy that mid level plan are talking about even buys cars solar plan on the marketplace and by that with just a tax credit spending our money so if you're the youngest that this works out decently well for you and I am one of the kind of weird things as with the tax credits are by decades of twenty to twenty nine at the same tax credit thirty to thirty nine year olds on so forth so once you hit each new decade you kind of are able to afford a little more and then you keep getting age rated as you go up the decade so you can for lesson last until you get your fortieth birthday and to you at your fiftieth birthday and then up in the sixties you can afford something that I would really call the insurance they Urban Institute estimated you could afford a plan with a twenty five percent actuarial value which means I average a cover has twenty five percent of your health care of the members' health care costs which is the most actors were not considered a health insurance I don't think CL consider that health insurance like this is a very very bare bones catastrophic plan so it depends really like how old you eyes are the key term is also where you live is going to be important to oh I think people who live in an urban be able to afford more than people who live in rural areas the support from voters if older lower income will likely live in a whirl I would not be in Vegas shape yes I mean you're kind of person I think the person who does best and this is like twenty one year old who lives in New York City and the person who does worse than this is like a sixty three year old two who lives in like for all Alaska Air Midwest that's kind of like that to change and you will know this not the voters you think that Trump administration realizes this fact the question I mean I think to be fair it's kind of a weird way where the policies of the two parties favor don't really line up at their base because you could say within the Democrats realize that they were making in turns really expensive for young people and that's their basic they made all the drones expensive at twenty one year old who lives in New York unlike why would they do that so I think is happening on both sides and the reason they did that is because as a principled about health insurance to be less expensive for older people there willing to make that tradeoff and using the opposite here we have a governing philosophy that insurance the government should not subsidize insurance is much that it should make it cheaper for young people to bring to make the whole rescue a healthier to make it more like the market before Obamacare and that really cuts against the people who typically support that kind of thing because I've seen on my tweets this morning a lot of people showing these maps that are going around and those all show that older people tend to get higher subsidies under this plan rather than younger people which is true why is it that even older people are getting more subsidies there for less an excellent question Matt so it has to do with another change that has made a mess I'm in CA and it is right now Obamacare lets insurers charge older people three times as much as the youngest enrollees and the idea here is really just constrain the costs for older Americans are saying earlier older Americans tend to cost about five times as much but that makes all the expenses of the demonstration said we want to cover those six year olds were locked on the market before we're going to make young people pay le Mars older people pay last times with it the aha wants to continue doing this on the healthcare bill Republicans they want to it you see exactly at nine a m coming from them the Republican health care bill wants to move to five to once a new trial this really is five times as much as the youngest so what you have is five to one aide Redang where older and older the premiums old strollers or five times as great as the youngest but to live to one subsidies to the subsidies or older only twice as big as the subsidies are young people spending on health insurance for old people goes up but old people are actually able to afford last shower yet are getting a bigger credit for their premiums going up much much more than the credit well will track with a curious design so this thing brings a different there's another piece of this perfectly for poor folks who were not on the tax credit subsidies are but were being covered by Medicaid at least in the state said in a Medicaid expansion so what is what is not to give him a hero in health care and Medicaid so they um they heard a lot of feedback from governors are expanding Medicaid there's fifteen Republican governors who run Medicaid expansion states who really want to keep the program so what they do is a key Medicaid expansion in tact for three years through January the first twenty twenty and at that point Medicaid expansion Roman freezes you can sign any more people up you can keep the people you have on but the idea is some animals get to turn inform some of them will roll off the program because their income changes and eventually the program will shrink there's decent evidence that when you freeze enrollment it's a very fast shrink its not like the kind of slow lingering thing I think in Arizona they did this with our kids health insurance program is not just a really steep decline such one side of it the other side of that is change the entire Medicaid program where they would like to convert it to a per capita caps a stem right now the way Medicare works or Medicaid works is that the government has an open ended commitment to covering people's medical bills if you're on Medicaid the federal government has a certain percentage of bills the state has a certain Santa doesn't matter for bills or one thousand ten thousand million dollars the government is committed to covering those bells under this Republican plan they would kind of figure out and then figuring out is actually a hugely important process we can talk a bit more about that later it was a Here's how much we think is reasonable to give you for each person on Medicaid give states that lump sum and they would have to kind of that make sure this live within their means we don't really know what would happen if you had that million dollar patient to kind of wiped out every all the payments like what you would do then and so that's part of this bill I don't really understand super well right now because we ex because I don't think we have great data on the size of that amount and how quickly would grow which are these wonky details we know it would grow by the Consumer Price Index that was the official name of the Consumer Price Index matter medical inflation index which in my opinion is a much less reasonable choice than it sounds like it's more generous than just the CPI but it still seems anyways I don't really know how exactly would grow these payments and that's a hugely important part to figuring out is a huge cut to Medicaid is a small Coyote is it not cut it and it seems like some of the initial data suggests most of the Medicaid cuts on the expansion side not on the cap and cap side but that's what I'm waiting for little the Medicaid population is pretty heterogeneous right seems like you have a lot of like children of low income parents whose health care costs are probably not that high in the scheme of things the author of a lot of low income elderly people in long term care situations whose so I mean it seems like when we get down to this ride is going to be a big question like internal to Medicaid rate if you're funding is based on a per person though is categorize you get her kids per disabled per able bodied adult so they do not categorize it by the type of people you either Medicaid or does not create incentive to kick the long term care off people often get these really cheap kids on things magazines are just a tremendous source of journalism I got my start working for magazines and in turn Dev Rolling Stone I've worked at a small magazine for years at Nevada the Atlantic at the same time digital technologies which is incredible convenience to be in the readings on iPhone or iPad to have it on me all the time instead of fussing around with paper and texture is the solution to that it's it's the publishers of like almost all the leading magazines in the world have come together they made this happened they've got everything that time the Atlantic Newsweek hundreds of others I like to well it's an architecture magazine it sort of frees my mind for these other kinds of things reading music amongst own business and technology in Fast Company and texture goes beyond delivering the magazine itself to make it easy to find enjoy articles you want to read the daily recommendations exclusive interactive features videos more it's normally two hundred magazines which is like a core easy good deal right now you've got a fourteen day free trial that extra dot com slash weeds that's fourteen days to try texture for free the detection dot com slash weeds texture dot com slash weeks ok so on Medicaid expansion is hell and you can actually add new people hell you could you could I forget so could come in and as of right now in Kansas and Maine There's actually like some initial steps toward Medicaid expansion I actually think this bill is a huge incentive to expand Medicaid right now and get a ton of people signed up in a weird way that all of this bill could entrenched Medicaid expansion more than Obamacare does then in twenty twenty they don't stop covering those people but you cannot add any new people on under those terms someone someone falls off for good and then they move Medicaid to this somewhat undefined in terms of the exact dollar amounts but the Medicaid per capita cap which we expect right again they not been super clear about any This is a lot does work out and there's no Congressional Budget Office score the bill yet but we expect is going to be a large long term caught in the recent has to be a very large long term cut is contained in the Texas portion of the bill yes if you do not do big Medicaid cut this next part really fucks everything up yes so there is there appears to be a curious lack of revenue this bell which is how do you pay for at the Republican health care bill wants to keep a version the subsidies they want to keep Medicaid expansion around for a few years both of those things are expensive on the Affordable Care Act included a number of new taxes and cuts to Medicare that oil would finance this whole expansion and initially Republicans wanted to raise some revenue by capping the exclusion for employer sponsored coverage so right now attacks on the entrance to get work they wanted to tax anything above the ninetieth percentile of plans it turns out that this has been like a quest for years has come up so many times and everytime any legislator politician raises that employers freak out and lobby like Allen the politicians legislators initially retreat inside was a terrible idea that's exactly what happened with this bill where the cap on the employer sponsored tax exclusion was in until the very final draft and then it falls out and say what they do is they keep the Obamacare taxes around till January first twenty eighteen I do not understand how that raises this one your taxes raises enough revenue and there's also some state budget trickery going on with keeping the Cadillac stacks around starting in twenty twenty five push that out the push outs and so to me either and I am very curious to see the CBO score and where the money is coming but hit the US is taking this build face value real quick it cuts all the Obamacare taxes on on party on the rich yes so the Joint Committee on taxation to score and it is six hundred billion dollar tax cut over ten years which given where these taxes are coming from is a very very regressive tax cut yes so in addition to spending a lot of money this bill also drop six hundred billion dollars out of the federal coffers again we don't have a score on the bill will be lovely to score but which we should talk about later but I just I really want to drive this home because I think it important for understanding on board talking about the six hundred billion dollar tax cut in this bill is a thing this bill is doing for the wealthy mostly for the wealthy has nothing to do with providing healthcare for people but it is happening here and it drives a lot of other questions that are going to have to get insurance regulations which are fascinating which insurance regulations are kept so a lot of insurance regulations or cat more than I think we initially expected from earlier drafts the ban on preexisting conditions the ban on lifetime limits on annual limits inherent letting young adults stay on their parents' plan up to age twenty six essential health benefits those had fallen out an earlier draft another the back fer for uncertain reasons reasons we could talk about but this is the requirement that health insurers can cover ten different sets of veterans' benefits including maternity care medical services prescription drugs and usually Republicans want to take up part of the bill out because they felt about his owner as it drove up the cost of health insurance by having all these expensive insurance mandates so all of those regulations on insurance remain and I think the big ones a change of the individual mandate is no longer there is a place that this provision called continuous coverage which is a surcharge on people who don't maintain continuous coverage the ideas at the same as the individual mandate you're trying to create an incentive for healthy people to buy insurance when they don't think they need at the individual mandate at bi annual find that you pick the government the Republican plan does it with a thirty percent surcharge when you re enter the individual market that have to pay for here there is a debate happening right now about whether this would induce the spiral whether this policy is I'm strong enough to get healthy people to buy insurance on and you can read a piece on Vox about that very debate so can I just made half the sauce down enough for me to think it's super important so the way the insurance mandate works is that if you don't buy insurance I believe right now you get fined the fine has a complicated mechanism behind it but I think it's two point five percent of income every year you don't have insurance this would say and that's it that's the annual things that get you into the pool every single year what this would say is let's say from let's say that I was twenty one and I didn't buy insurance I bought a twenty two I would have a thirty percent surcharge one year yes let's say I was twenty one I didn't buy into it I got sick at thirty five if I would have a thirty percent surcharge for one year yes by not having an annual structure this allows for a gets a possible scenario where people wait a lot longer but not pay any more fine for waiting till they got sick to get health insurance Republicans been saying over and over again that Obamacare it's having this processor market I'd only read The Sparrow scenario yet in Obamacare but it's definitely true the man does tweak dreams have been going up this is a problem that is way obvious to me the salt and Mimi were not solved the selection problem and bubbles escape who will take pretty seriously as a consultant for the healthcare industry he has this post on he's not a fan of Obamacare he says that Obamacare is an anti selection machine and this is even worse so we'll say there is this is a very active in talking to people who think differently about it you think that the individual mandate is quite weak and because of that but that's kind of your baseline or that that's the mechanism you've been using and it's a very lo fi and over over time so it is a smaller fire in each year but it does add up like you're saying I think one interesting thing they learned talking to former Senate aide who was working on the Republican side in two thousand nine they had CBO score provision like this and CBO thinks that work the same CBO thinks that penalties they essentially induce the same sort of behavior that doing continuous coverage and seven dual mandate would not create coverage law sometimes people in insurance industry and it is telling to me that they are not super worried about this provision of anyone has anything to lose them and the spiral it is the health insurance companies who would get stuck with these bills that the premiums don't cover and they they like them and a batter but they say like this is the second best option like this is not the hell we're going to die and so is interesting to hear that from the people who really have a big horse in this life sorry the bigger problem from a desperate point of view it seems to me goes back to the fact that the premiums don't scale with the cost of the plane ride so if you're thinking about where we most concerned by consumers right now have very very very little choice white but because his Obamacare does more subsidies the more expensive the local plans are is a pretty good incentive to be like the one provider in an area if you can be whereas under under Ah cha rate you can't just like Be them anomalous and jack prices up and earn a windfall because people won't have credits that cover your windfall profit suddenly the light one to zero margin seems much more plausible than it is with before yet the sounding of the jets pilots like a collapsed insurance my camera no one wants to sell a third of a group that's that's when you die I mean it's like not a death spiral heart attack or not it would be very bad day I think there's a kind of near death experience built into the AC A's structure like once you the last ensure standing you actually like are in pretty good shape and almost no matter what because at a minimum there's this low income population who's getting your plans basically at no cost to themselves but there's nothing like that there's no like bottom line safety net reason that like anyone should be providing insurance in rural portions of hours I mean this is raising numbers unlike SNP ratings agency yesterday they put out an estimate that uncovered will decline to four million people in the marketplace and even get the baby right up to the analyst doesn't think the continuous coverage thing is a huge issue he thinks it'll be a smaller but stable market I think you're right that when the government subsidies scaling back a lot that fewer insurers want to anticipate fewer people want to participate in and pay for all the time to be very interested when we get coverage estimates I've seen a lot of health care wonks estimating fifty ten to twenty million the recipe came out I think including the Medicaid estimates for its sixth man but that ended twenty was a draft that was if I was reminded that this is what lor now than people think about this draft might be wrong and this will just be awesome to see I want to talk about what other insurance regulation actuarial value changed oh yeah laugh our hair really getting into it but this is again I think yet so they change so actuarial value is the wonky term for the average amounts that health insurance plan covers for its enrollees so if a plan as an entry of actuarial value of seventy percent it means that on average among all its patients it covers seventy percent of the bills and the individuals paying thirty percent of their medical bills and it's it's a good way to do apples to apples health insurance comparison because sometimes it's really hard to understand how much is plain cover between the co pays and co insurance deductibles and premiums like how much I actually paying right now Obamacare requires all health insurance plans to have an actuarial value of at least sixty percent consider it a health insurance plan it has to cover sixty percent on average of its members' costs the Republican plan would get rid of that requirement as you could lower that there's no actuarial value standard some states are probably pass one states used to have them before the Affordable Care Act passed but this could be a way the essential health benefits are technically included that they could become financially out of reach of patience let say you have a really catastrophic health insurance plan with like forty or thirty five percent actuarial value so that may mean you know you've up plan that covers maternity care a lick of or substance abuse treatment but has a hundred I hope each time you are the Doctor has a huge out of pocket deductible so this could be another really big change from how the healthcare law works now is the Republican brand does keep Obamacare out of pocket maximum which I think is about six thousand or so dollars right now I am but a lot of money that these you have to create an actuarial value that Tom didn't require does and feels more than six thousand dollars but you could give would still go pretty low with happening now which is that and we talk about why this is happening and that they're keeping a bunch of the regulations on what plans have to cover but not what percentage of benefits the covers and others to think that appoint a different direction see have to cover all the essential health benefits including This was the Republicans' big attack on Obamacare forever the essential health benefits are crazy and they're driving up the cost of everything you had men paying for maternity care and have nothing to do with childbirth sow commanded to pay for maternity care but the cup and then cap lifetime limits and caps of the out of pocket caps n but you can have a plan that covers as little as you want this is the last This action will benefit change is the final thing Republicans can do it's really the only thing they're doing on average for everyone right because the age rating makes it cheaper for young the more expensive meal this is the only thing they're doing to make all health insurance conceptually cheaper
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