Who Loses the Most If Obamacare Is Repealed?

President-elect Donald Trump campaigned on a pledge to deliver “a full repeal of Obamacare,” and with Republicans soon to control both chambers of Congress, there’s little to stop him from making good on it. Though Trump has already begun to walk back his vow to ditch the Affordable Care Act (ACA) altogether—he recently told the Wall Street Journal that he would consider keeping popular provisions like the prohibition on coverage denials for people with pre-existing conditions —even a partial repeal could bring major harm to millions of Americans who might not realize the benefits they’ve been getting from the law.

The GOP’s criticism of Obamacare has largely focused on rising premiums on insurance offered in the marketplaces—the “exchanges”—where uninsured Americans can buy coverage. But the ACA covers much more than premiums and the exchanges. Here’s who stands to lose the most if Trump follows through on his promise:

Americans in states that voted for Trump.

The biggest impact of an ACA repeal would be the loss of health insurance coverage for an estimated 20 million Americans, including about 11 million who’ve bought policies through the ACA exchanges.

Of these, about 9.4 million receive tax credits to help them afford coverage, according to the most recent figures available from the Centers for Medicare and Medicaid Services (CMS). On average, these subsidies total $291 per month and disproportionately benefit red state consumers. In fact, 68 percent of the beneficiaries of coverage subsidies live in states that voted for Trump.

According to CMS, the ten states with the largest shares of people getting federal help with their premiums are Mississippi, Florida, Louisiana, Wyoming, Alabama, North Carolina, South Carolina, Alaska, Nebraska, and Arkansas. In each of these states, all of which voted for Trump, about nine in ten enrollees receive subsidies to pay for coverage.

A repeal of the ACA would likely mean that the vast majority of these consumers become uninsured, unable to afford coverage without the subsidies and without access to lower-cost plans in the exchanges. Replacing the current tax credit with a deduction—as Trump proposed during the campaign—would also be of little help, given that only 32 percent of Americans itemize deductions on their tax returns.

People with pre-existing conditions.

As many as 129 million people—or more than a third of Americans—have some type of pre-existing health condition, according to the White House.  “People would be surprised about what would count as a pre-existing condition,” says JoAnn Volk, Senior Research Fellow and Project Director at the Georgetown University Center on Health Insurance Reforms. “It could be asthma or a bum knee from playing high school basketball.”

Even if Trump and the Republican Congress chose not to repeal the provisions protecting consumers with pre-existing conditions, this concession may ultimately prove hollow. That’s because insurers rely on the requirement that everyone buy coverage and on the extra revenues provided by coverage subsidies to help keep premiums lower. Trump and the GOP Congress are likely to scrap both the mandate and the subsidies, which means fewer healthy people would be buying insurance to subsidize those who get sick.

While insurers could still be required to offer a policy to someone with a pre-existing condition—so-called “guaranteed issue”—the price could be prohibitively high. Under current law, insurers can’t discriminate against consumers with pre-existing conditions by charging them higher premiums. But this, too, would be economically impossible for insurers if the mandate and tax credits disappear. Premiums could skyrocket. “And there will be no subsidies to make it affordable,” says Volk.

People facing a catastrophic illness.

The ACA includes a variety of protections for Americans facing catastrophic health care costs stemming from things like car accidents, cancer, or chronic conditions such as hemophilia. For example, the law bans companies from imposing lifetime or annual dollar limits on what insurance will cover, a provision the White House says benefited 105 million Americans when it went into effect in 2014. The ACA also prohibits insurers from canceling coverage if a beneficiary falls sick or for a mistake on an insurance application.

Before the passage of the ACA, one expensive operation might have been enough for an insurer to drop someone from a plan. That protection could go away if the ACA is altered or repealed.

Anyone who loses or changes jobs.

While two-thirds of American workers have access to employer-sponsored health insurance, this security disappears if someone is laid off or fired, quits work to go to school, or is in between employers. Before the ACA, many of these workers had no affordable option for insurance.

“The whole idea of [the ACA] was to create a marketplace for people who don’t have employer-sponsored insurance to get health coverage,” says Ron Pollack, Founding Executive Director of Families USA, which supports the ACA. “Where would people get their coverage if they don’t have employer-sponsored health care?”

Ending the exchanges would mean a return to the pre-ACA days when many Americans went uninsured in between jobs, with all the attendant risks of extreme financial insecurity at a particularly vulnerable time. And for some people who do have employer-sponsored benefits, it could mean “job lock”—not pursuing new opportunities for fear of losing coverage.

Lower-income Americans.

Another major benefit of the ACA was the option for states to expand Medicaid eligibility to all families with incomes below 133 percent of the federal poverty line. Under the law, the federal government would pay for 100 percent of the costs of this shift through 2016 and 90 percent of the cost thereafter.  As of 2015, according to White House data, 8.6 million people in 28 states and the District of Columbia had gained coverage from Medicaid expansion in their states. While states could continue to cover these individuals in the event of an ACA repeal, it’s unlikely that many states will have the budgetary resources to do so, thereby throwing millions of low-income working Americans back into the ranks of the uninsured.

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In addition to these benefits and consumer protections are other everyday perks, such as the elimination of out-of-pocket costs and co-pays for preventive care. Most Americans who have insurance no longer pay for immunizations, contraceptives, reproductive counseling, and certain screenings for cancer. And for people on Medicare, the ACA now provides for free annual physicals as well as no out-of-pocket costs for cancer screenings and other preventive services.

Benefits such as these could make the repeal or alteration of the ACA much tougher than Trump or Republicans in Congress might expect.

“It’s one thing to withhold a benefit or coverage from somebody who’s never had it,” says Families USA’s Pollack. “But it’s a very different proposition to take away something that people have gained and that they consider their lifeline.”

 

 

Anne Kim

Anne Kim is Senior Writer at the Washington Monthly.