The Graham-Cassidy Health-Care Bill Is A Clear Danger to People With Preëxisting Conditions

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The Graham-Cassidy Health-Care Bill Is A Clear Danger to People With Preëxisting Conditions

John Cassidy, The New Yorker

As the Senate gets closer to an expected vote, next week, on the health-care-reform bill championed by Senators Lindsey Graham and Bill Cassidy, Republicans—Donald Trump included—are still claiming that the measure keeps in place protections for people with preëxisting conditions, while Democrats, health-care experts, and Jimmy Kimmel are insisting that it doesn’t. (My colleague Ian Crouch has more on Kimmel.)

The draft legislation doesn’t overtly repeal the Affordable Care Act’s ban on insurers denying coverage to people with preëxisting conditions, and it doesn’t explicitly abandon the A.C.A.’s community-rating regulations that prohibit insurers from charging people with serious illnesses much higher premiums. The bill would, however, allow individual states to obtain waivers from these rules if they persuaded the Department of Health and Human Services (H.H.S.) that they could “maintain access to adequate and affordable coverage for individuals with pre-existing conditions.” Since the bill doesn’t define what “access to adequate and affordable coverage” means, critics say that it is effectively sanctioning a return to the days before the A.C.A., when sick people in many parts of the country found it extremely difficult and costly to get health coverage.

Usually, in these types of disputes, the nonpartisan analysts at the Congressional Budget Office act as the arbiters. When “scoring” a health-care bill such as Graham-Cassidy, they go through each of its major proposals and provide numerical estimates of its likely effects. In this instance, though, the Republicans are exploiting the fact that the C.B.O. hasn’t had time to do a detailed analysis of their bill—it is expected to produce just a truncated report before next week’s vote.

But the matter shouldn’t be allowed to rest there. As Sara R. Collins, a health-care-insurance expert at the Commonwealth Fund, pointed out in a blog poston Wednesday, the C.B.O. analyzed a very similar waiver proposal in May, and its findings were damning. The agency concluded that about fifty-five million Americans would end up living in states that would opt out of the A.C.A. community-rating rules. In these states, the C.B.O. analysis said, “over time, less healthy individuals (including those with preexisting or newly acquired medical conditions) would be unable to purchase comprehensive coverage with premiums close to those under current law and might not be able to purchase coverage at all.”

The C.B.O. analyzed this proposal as part of its scoring of the American Health Care Act, the bill that House Speaker Paul Ryan pushed through the House earlier this year. Some Republicans complained that the A.H.C.A. didn’t go far enough to dismantle Obamacare, and in May, Tom MacArthur, a New Jersey Republican, proposed an amendment to the bill that enabled states to obtain waivers from the A.C.A.’s community-rating rules as long as they set up subsidized high-risk pools or reinsurance programs to cater to people with preëxisting conditions. The amendment set aside up to fifteen billion dollars a year to finance the state-run schemes.

In analyzing this proposal, the C.B.O. conceded that there was a good deal of uncertainty about how many states would seek a waiver from the community-rating rules. To decide what each state would do, it looked at their “past behavior regarding the nongroup market (including the rules that existed or exist in state law) as well as current market conditions.” On this basis, the C.B.O. estimated that states containing about a sixth of the population would obtain waivers. Since there are about three hundred and thirty million residents of the United States, this means that about fifty-five million people would be affected if they were sick, or got sick.

And this might well turn out to be an underestimate. Before the A.C.A. passed into law, in 2010, only seven states prohibited insurers from basing their prices on health status: Maine, Massachusetts, New Jersey, New York, Oregon, Vermont, and Washington. Thirty-three states had no restrictions at all on so-called medical underwriting. It is perfectly possible that more of these states could revert to their previous stance than the C.B.O. anticipates, especially since the Graham-Cassidy bill is so vague about the sorts of measures they would have to take to obtain a waiver.

How much more would people with preëxisting conditions in these states be forced to pay if these waivers were granted? The C.B.O.’s analysis didn’t say. But other research suggests that premiums would be prohibitively high, even for people who enrolled in subsidized high-risk pools. Before the A.C.A. was introduced, thirty-five states operated these pools, which are targeted at people with actual or potential health problems. Research by the Commonwealth Fund showed that the premiums for these plans were up to twice as high as those offered in the regular market, on average. Moreover, the policies only covered about half of over-all costs. And in fourteen states they came with annual deductibles of ten thousand dollars or higher.

High-risk pools had other drawbacks. Some of them imposed lifetime spending caps, a huge problem for people with chronic conditions that demand expensive care. And most of them refused to cover, at least for a time, the illnesses that made their enrollees high-risk in the first place. “Nearly all state high-risk pools excluded coverage of pre-existing conditions for medically eligible enrollees, usually for 6-12 months,” a report by the Kaiser Family Foundation noted. The report went onto note, dryly, “This made coverage less attractive for people who needed coverage specifically for their pre-existing conditions.”

Supporters of the Graham-Cassidy bill argue that things would be different now, because the high-risk pools would be better financed than they used to be, and everybody with a preëxisting condition would be able to obtain affordable coverage. But they haven’t provided any persuasive analysis to back up this argument, and history suggests that it is fallacious. Even in subsidized risk pools, insurance is expensive, incomplete, and hard to come by. Jimmy Kimmel is right: the Graham-Cassidy bill represents a grave threat to the sick and their families.

• John Cassidy has been a staff writer at The New Yorker since 1995. He also writes a column about politics, economics, and more for newyorker.com.
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