Bioethics Forum Essay
Health Reform and Competing Visions of Justice
On May 4, 2017, just over one month after abandoning a previous version of the bill, the U.S. House of Representatives voted by a 217-213 margin (with one abstention) to adopt the American Health Care Act (AHCA). During the coming weeks and months, most of the political commentary will focus on the strategies that were used to generate sufficient support within the House of Representatives, its prospects in the U.S. Senate, and its implications for the 2018 midterm elections. These are important considerations, but it is crucial to reflect on the competing visions for the good society represented by the AHCA and the Patient Protection and Affordable Care Act (ACA). By radically reducing government support for health insurance, the AHCA promotes a remarkably different vision of what justice requires compared with the one offered by former President Obama and the Democratic Party. The ACA has moved the U.S. closer to the international standard of universal coverage, but the AHCA would leave millions of Americans without health insurance.
The bill does not repeal the ACA, as President Trump and the Congressional Republicans promised, but it would eliminate major provisions of what people think of as Obamacare. In addition to eliminating ACA taxes used to finance reform and most of the ACA insurance expansions, the AHCA allows insurers to charge older enrollees higher premiums and phases out the law’s premium tax credits. (For a careful review of the bill’s provisions, see Tim Jost’s post on the Health Affairs Blog.) What is particularly striking about the House Republicans’ plan is that, along with changes to the ACA, it reduces the federal government’s support for the original Medicaid program by giving states the option to accept either a Medicaid block grant or a per capita cap on federal support. This reduced support would fundamentally alter the role of the federal government in the Medicaid program and it is the primary reason the Congressional Budget Office (which has yet to score the current bill), indicated that the previous version of the AHCA would reduce the deficit even while cutting about $900 million in taxes. Overall, the bill would dramatically reduce federal government spending on health insurance. Furthermore, as many have documented, it would redistribute the remaining government health spending from older and sicker to younger and healthier Americans.
To generate sufficient support among Republicans who objected to the original version of the AHCA, the House added several amendments, some of which were designed to appease the conservative Freedom Caucus (e.g. allowing states to waive the community rating requirements that prohibit insurers from basing premiums on health status) and others designed to address concerns of members who want to minimize the loss of protection under the new law (including creation of a program that would add $15 billion to a new federal high risk pool for people with costly conditions). It is unlikely that the House bill will receive sufficient support to pass in the U.S. Senate. Most observers believe that any bill adopted by the Senate will be remarkably different than the House version. Nevertheless, after failing to generate sufficient support among House Republicans for a previous version of the AHCA, the adoption of this bill by the House was a short-term political win for Speaker Ryan and the Trump administration. It also reveals stark differences in the underlying philosophies embraced by the Republican leadership and the Democrats.
The ACA has not achieved universal coverage and it does not include any effective cost control measures. Despite these limitations, it built upon the existing patchwork system of American health insurance and has moved the U.S. much closer to a social insurance model for health insurance, which spreads risks across a population and across the life course, so that people who are healthier and wealthier subsidize people who are less healthy and poorer. In contrast, the AHCA moves the U.S. back to a commercial model of health insurance, in which the premiums are based on actuarial risk, and people who enjoy good health pay less for health insurance. In fact, by reducing the federal government’s commitment to Medicaid, the AHCA moves the U.S. further down this path than it was before the adoption of the ACA in 2010.
As I have argued previously, the health reform debate reflects competing visions of fairness and the good society. It is a debate between those who believe that health care is a right and those who want to treat it as just another commodity. The details of the proposals change continually and are likely to change even more once the AHCA moves to the Senate — but at its core, this continues to be a fight about whether health insurance in the U.S. should be based on social insurance principles.
Michael K. Gusmano is a research scholar at The Hastings Center and an associate professor of health policy at Rutgers University School of Public Health.