The Affordable Care Act saved her not just from cancer, but from financial ruin, Mosby told me. Her employer, a small Lake Tahoe resort, did not offer insurance. “I’d tried to get it personally and was knocked down,” she told me. “You had migraines? Preexisting condition. You’ve ever had a toothache? Preexisting condition. So I signed up for Covered California,” the state’s Obamacare marketplace. Her insurance had kicked in when the Affordable Care Act came into full effect on January 1, 2014. The treatment she needed shortly thereafter—including surgery and intensive chemotherapy—ended up costing more than a million dollars, paid for almost entirely by her plan. “It was the most astonishing blessing,” she told me.
Much of the debate around the GOP’s proposals has centered on how the bill will determine whether Americans have access to health care. But economists and policy analysts fear that any of the options under consideration by Republicans in the House and the Senate would not just strip away coverage and care from millions of America’s most economically vulnerable families. It would financially imperil them too. “There’s been an appropriate focus on how many more people will be uninsured,” said Larry Levitt of the Kaiser Family Foundation, a nonprofit that performs health-policy research. “In some ways, lost in the shuffle has been the dramatic changes these replacement bills would make in how much financial exposure low-income people would have.”
One way or another, economists and health-policy experts say that the Republican plans would place millions of lower-income Americans into dire financial circumstances. In a recent analysis, the Congressional Budget Office and the Joint Committee on Taxation estimated that the subsidized plans that former Medicaid enrollees would be able to buy would carry $6,000 deductibles—making the coverage unaffordable for a person earning, say, $18,000 a year. “As a result, despite being eligible for premium tax credits, few low-income people would purchase any plan,” the CBO concluded.
The result both for the insured and the uninsured would be more people going bankrupt, amassing debt, dipping into their savings, selling assets, and otherwise facing financial ruin when dealing with calamitous health problems—health problems, it is worth noting, that often destroy earning power at the same time as they require costly treatments. The bills under consideration “would reverse the gains we’ve made on cost protection,” said Sara Collins of the Commonwealth Fund, a health-care research foundation. “It would roll back the progress we’ve made with low-income families without addressing the underlying cost problems for people in the [exchanges].”
The House and Senate bills would increase financial hardship for lower-income families in several ways, experts said. First, rolling back the Medicaid expansion the ACA provided for would strip low-cost coverage from millions of people—coverage that has proven to be a powerful financial safety net. A 2013 study of Medicaid in Oregon showed that enrollment in the program cut the chances of having a medical bill sent to a collection agency by 25 percent, slashed in half the probability of having to borrow cash or delay paying other bills due to medical costs, and, researchers wrote, “virtually eliminated out-of-pocket catastrophic medical expenditures.” The Obama-era law added some 11 million Americans to the program, and the evidence is that those enrollees saw similar results: People who gained coverage had an average of $600 to $1,000 less in non-medical debt, an amount that rose to $1,400 to $2,300 for people who needed to be hospitalized or went to the emergency room. A new study by researchers at the Consumer Financial Protection Bureau and Penn State found that the Medicaid expansion reduced medical debt and non-medical debt, while also improving credit scores and lowering the bankruptcy rate.