Oh, sure, Ryan has offered some rhetorical explanations. He says Obamacare is “collapsing.” That it’s in a “death spiral.” That it’s a “struggle” for Americans. He says a “much, much better system” could be put in its place.
Ryan made all these points, and more, during a town hall meeting Thursday evening aired by CNN. The hour-long session didn’t yield an explanation for Ryan’s haste to take action that could upend insurance coverage for more than 20 million Americans. It did underscore, however, that his description of and position on the law are based on misconceptions, misrepresentations and lies.
Doubts about the wisdom of rushing into repeal — expressed not only by doctors, hospitals, health advocates, patients and even Republican governors — haven’t slowed the rush on Capitol Hill. On Friday, the House approved a budget resolution that will begin the process of stripping away some ACA provisions; the Senate passed its own version earlier this week. Nine Republicans crossed the aisle to oppose the measure, which otherwise passed on a party-line vote.
Here are some of the most glaring misstatements about the Affordable Care Act that came out of Ryan’s mouth during the Thursday town hall.
-- “The law is collapsing.” “We’ve got to rescue people from the collapsing of this law,” Ryan said. He didn’t specify what he means by “collapsing,” but by almost any measure of enrollment and cost this generalization has no basis in truth. Enrollment in private plans offered through the ACA exchanges for 2017 is running well ahead of the figure for 2016. Last year about 11 million people signed up for exchange plans; this year the total is projected to be 12 million. That’s not counting enrollees under Medicaid expansion, who number about 11 million.
--Premium increases. Ryan maintains that premium increases for ACA plans are unsupportable for American families. He expounded on this issue in response to a question from Jeff Jeans, a member of the town hall audience. (See accompanying video.) Jeans described himself as a small business owner and Republican who had been dead set against Obamacare — until he was diagnosed with cancer at age 49.
“Thanks to the Affordable Care Act, I’m standing here today alive,” he said. “I want to thank President Obama from the bottom of my heart, because I would be dead if not for him.”
But when Jeans mentioned that he lived in Arizona, Ryan thought he had a “gotcha.” Pulling a note card from his pocket, he reeled off the premium increases for Arizona and a few other states for 2017. “Arizona — this year, the premium increases for people on Obamacare, 116%,” he said. Oklahoma, Tennessee and Minnesota also had double-digit premium increases.
A few points need to be made here. First, premiums and deductibles were rising before the ACA, and in many cases, the post-ACA increases are lower than before. Moreover, the four states Ryan mentioned were those with the highest increases in benchmark silver plans — the figures Ryan was using -- for 2017. What he didn’t mention was that increases in many other states were much lower. Arkansas, Ohio and New Hampshire — 2%. In Massachusetts and Indiana, rates actually dropped.
One reason Arizona rates rose so much is that premiums in that state had been inordinately low; insurers were making up in 2017 for lost ground. In 2016, the average benchmark plan premium for a 40-year-old in Phoenix, according to healthinsurance.org, had been $207 per month, one of the lowest rates in the nation, bested only by New Mexico and Indiana. The 2017 increase will raise Arizona’s rates to among the nation’s highest, but the increase over the average is nowhere near what Ryan cited.
Most important, the premium increases don’t remotely reflect what most Arizona ACA enrollees — or those of the other states — will actually pay. That’s because ACA subsidies are designed to rise in tandem with premiums, or in some cases even faster. In Arizona, 76% of enrollees get a premium subsidy, and more than half also get a subsidy to help pay deductibles and co-pays. State-by-state statistics on subsidy increases for 2017 are here.
In Arizona, the subsidies for 2017 are rising 428% for a 27-year-old earning $25,000 and 270% for a family of four with a $60,000 income. For that family, the list price of insurance will average $1,529 a month, but the subsidy will slash that to $405, or $100 per person.
Ryan didn’t mention any of that.
--High-risk pools for preexisting conditions. Ryan understands that protection for people with preexisting medical histories is the most popular element of the Affordable Care Act. Republicans eviscerate it at their peril. He told the town hall audience that the GOP has “a better way” to guarantee coverage for those people: high-risk pools. Separating those with expensive conditions from the overall insurance pool will make insurance cheaper for everyone else, he asserted. Since “8% of all the people under 65 have that kind of preexisting condition,” sequestering them would “dramatically lower the price for the other 92%.”
“We had a really good one in Wisconsin,” Ryan said. “Utah had a great one. I was talking with a congresswoman from Washington today who was telling me how good their state high-risk pool is.”
A lot of misconceptions and untruths are packed into this spiel. It’s unclear where Ryan got his figure of 8% of Americans suffering from conditions that would relegate them to a high-risk pool, but it grossly underestimates the problem. The Department of Health and Human Services estimated in 2011 that 50 million to 129 million Americans under 65, or 19% to 50%, had some kind of preexisting condition and up to 20% of them were uninsured. The ratio rose sharply with age, so that as many as 86% of those aged 55 to 64 were at risk of being denied insurance because of their medical condition. In 2012, FamiliesUSA estimated that nearly 25% of all Americans under 65 could be denied coverage without the ACA protections.
America’s experience with state high-risk pools has been almost universally grim. Before the ACA’s enactment, 35 states had such arrangements. They were chronically underfunded and for enrollees they were expensive, with deductibles as high as $10,000 and premiums as high as double those for healthy individuals. Every state excluded coverage for as long as a year for the very conditions that made their users uninsurable on the open market. They typically imposed benefit limits too low to pay for treatment, time limits for enrollees, and waiting lists.
For these reasons and others, by 2000 the pools were covering only 8% of the uninsurable population, according to a survey by health economist Austin Frakt. (That may be where Ryan got his figure, but if so he made a glaring error.) Economist Harold Pollack calculated in 2010 that if a nationwide pool covered only 4 million people with a history of emphysema, stroke, cancer or a heart condition, it would cost more than $24 billion a year and would still need to impose waiting periods before coverage of a condition and other restrictions. Whether a Republican Congress fixated on budget-cutting would appropriate that kind of money is doubtful.
As for the success stories Ryan touted, he’s overstating the case. Wisconsin’s pool did better than most, with 23,000 enrollees in 2013, but imposed deductibles of at least $5,000, premiums of twice the standard rate, and a six-month waiting period for coverage of a preexisting condition. Utah Gov. Gary Herbert was already fretting about the rising cost of his state’s high-risk pool in 2010, when the Affordable Care Act was enacted and took the problem off his hands.
It’s unclear what Ryan is referring to in his mention of Washington’s high-risk pool. Like other states, Washington shut down its pool when the ACA’s guarantee of coverage for anyone with a preexisting condition kicked in. It’s still covering a few people who were enrolled before 2014, but that will end this Dec. 31. Before the ACA, the program was not popular. Premiums ran as high as $23,000 a year, and covered only about 30% of patients’ expenses. The rest was borne by surcharges on commercial insurers, meaning that everyone with an individual or group policy in the state was paying for the pool — a reminder for Ryan that the cost of covering preexisting conditions can’t be eliminated, only shifted around.
--The “death spiral.” At the town hall, Ryan reiterated the specious claim that because more unhealthy people are buying Obamacare plans and “healthy people [are] not buying it,” rates are “skyrocketing,” driving more healthy people away and leaving costly unhealthy customers in the pool in a vicious cycle.
Experts who have examined the ACA market say nothing of the kind is happening. The Council of Economic Advisers reported this month that there’s no evidence that premium increases have had an adverse effect on either enrollments in the individual market or the risk pool. Enrollment is rising, and signups of people in the 18-34 age range — the most desirable because most healthy category, have remained steady at about 28% of total enrollment. That’s not as high as the 40% share that would be required to make the pool totally self-sustaining, but it’s not declining either. And it contradicts Ryan’s claim that “younger, healthier people [are] just going without insurance.”
--What about replacement? Ryan was, typically, vague about what the Republican congressional majorities will propose to replace the ACA if it’s repealed. He said he didn’t want to get into “all of the legislative mumbo-jumbo,” but of course the nature of the replacement isn’t mumbo-jumbo to Obamacare beneficiaries — it’s their life-and-death concern.
One idea he did mention is expanding health savings accounts, which allow people to set aside tax exempt funds to pay medical costs. As we’ve mentioned before, HSA’s are giveaways to the rich and of limited use for lower-income people, who have trouble scraping together funds to put in an account and who won’t get much benefit from a tax exemption.
The most important question that Ryan dodged on Thursday, and again after Friday’s House vote, is what’s the rush? Repealing almost any part of the ACA will leave the individual insurance market in worse shape than it is now, and possibly worse than it was before the ACA. That’s especially true as long as no replacement plan is on the table. There are many routes to improving the Affordable Care Act without eroding public protections. If Ryan is truly intent on improving the lives of Americans dependent on the act, why does he have to shroud his intentions with misstatements and misrepresentations?