A Republican plan to replace the Affordable Care Act would raise health insurance costs in Nebraska faster than in most other states, according to a new report, and advocates say rural areas would be hardest-hit.
The analysis was released last week as some members of Nebraska’s congressional delegation faced loud public opposition to the GOP plan at town hall meetings.
Critics of the plan say Nebraska would see larger-than-average increases because it has a disproportionate share of older and low-income residents, many of whom received tax credits through the federal health insurance marketplace. The new congressional plan reduces the tax credits that many receive to offset their expense and eliminates cost-sharing reductions for low-income individuals.
“Our greatest fear is that we’ll see people dropping their health insurance,” said Mark Intermill, a lobbyist for AARP Nebraska, a leading advocate for the current health care law known as Obamacare. “I can’t overstate the significance of this for Nebraskans. … It’s frightening that they might not have care.”
Lower-income individuals in Nebraska could see an $8,100 increase in their costs by 2020, and older residents could pay an additional $13,500, according to the analysis by the left-leaning Center for American Progress. Only five states would see larger increases — Alaska, North Carolina, Oklahoma, Arizona and Wyoming.
Nationally, the group’s analysis found that individuals who make less than 250 percent of the federal poverty level would see their costs jump $4,800 by 2020. Americans between the ages of 55 and 64 would see an increase of more than $8,300.
State officials say they haven’t estimated how many people the bill might affect. Nationally, the nonpartisan Congressional Budget Office estimates 24 million Americans who receive Medicaid or buy insurance through a government-facilitated marketplace would lose coverage by 2026.
The Affordable Care Act prevents insurance companies from charging older customers more than three times what they’d charge younger customers. Under the GOP plan, companies could charge five times as much, and states would have the option to let them charge even more.
Before the ACA, Nebraska did not impose any such requirements on insurers, said Bruce Ramge, director of the state Department of Insurance.
Advocates are also concerned about proposed per-capita caps on the Medicaid program, touted as a way to reduce the federal government’s costs and give states more flexibility. The caps wouldn’t account for changes in the cost per enrollee beyond a predetermined growth limit, according to the nonpartisan Kaiser Family Foundation.
Intermill said the proposal would essentially penalize Nebraska for having a strong economy and being frugal with Medicaid dollars.
The caps are based on the state’s Medicaid funding in fiscal year 2016 — a time when the federal match rate was at a historic low because the state economy was booming. Because the match rate was low at that time, Intermill said the state could receive roughly $180 million less than it otherwise might have. Nebraska also hasn’t spent as much on Medicaid services for older people as other states, so the base rate is lower, he said.
Intermill said a provision in the bill to repeal one of the Affordable Care Act’s taxes would destabilize Medicare’s finances. Nebraska has a larger share of low-income elderly residents than other states, particularly in rural western areas.
Nebraska officials haven’t yet reviewed how the GOP proposal would affect the state’s insurance market, Ramge said. A spokesman for Gov. Pete Ricketts said the administration “has been working with other governors to provide feedback to the Trump administration” but did not elaborate.
Members of Nebraska’s congressional delegation faced angry crowds last week at town hall meetings.
Republican U.S. Rep. Jeff Fortenberry last week took questions in Lincoln from about 1,200 people, most of whom voiced opposition to the GOP health plan.
Fortenberry noted the bill would save an estimated $337 billion by 2026 and argued the ACA is flawed.
“We can’t sustain the current system,” he said.
At a town hall gathering on March 17 in Omaha, U.S. Sen. Ben Sasse said the GOP proposal was likely to change before it passes, but he insisted the status quo isn’t acceptable.
The bill is especially worrisome to Matt Mason of Omaha, who struggled to get health insurance for his Type I diabetes treatments after he finished graduate school.
Mason relied on state-subsidized coverage before the ACA took effect, and had to purchase a separate policy for his wife and two children. By the time President Barack Obama signed the law in 2010, rising costs had forced Mason to take a plan with a $10,000 deductible. The health care law allowed his family to share one plan.
Mason, 48, said his health care costs have still risen, but congressional Republicans “seem like they’re stepping on the accelerator rather than fixing the problems.”
“This whole way the government is treating this terrifies me,” he said. “It does not seem like a methodical, intelligent treatment of a very real problem. I’m left watching one of the most important things to my life and my livelihood treated like a stray dog they want to put down.”
Lisa Schwetschenau, of Omaha, fears the proposal could open the door to her losing coverage for some of her multiple sclerosis treatments. The 48-year-old relies on her husband’s employer-based insurance plan for physical therapy and used it to get mental health treatment.
Schwetschenau said she’s worried the GOP proposal would eliminate the employer mandate to provide coverage and let states pick the “essential benefits” that plans must cover. Both her physical therapy and mental health treatment are considered essential benefits under the ACA.
“I feel very vulnerable at the moment,” Schwetschenau said. “There’s no guarantee that they’ll have to provide it on an ongoing basis. My husband’s employer could come back one year and say it’s too expensive, and they won’t provide it anymore.”