Shhh. Don't Tell Ben Stein - ACA Didn't Reduce Access to Care, But AHCA Will

Did Obamacare reduce access to care? That’s one of the arguments being made today by members of Congress who have rushed to judgment by voting for an inadequate replacement plan.

It may surprise you that they call it “AHCA,” which sounds just like “ACA.” But it shouldn’t. Polling data always showed that “ACA” was a lot more popular than “Obamacare,” because many people did not know they were the same thing.  Republicans are hedging their bets – next election they hope they can tell a confused public that they were opposed to Obamacare but for AHCA.

But back to the question.  Did Obamacare reduce access to care?

That’s the argument made by the American Spectator, which counts among its editors the conservative, math-challenged, icons Jeffrey Lord, Ben Stein, and Grover Norquist. They argue that this is evident because of the 71 rural hospital closures since 2010 – approximately one per month.

That’s pretty astonishing. Seventy-one rural hospital closures in six years may not represent a lot of beds, but many served as safety net providers in underpopulated rural areas.

But what was happening with hospitals before Obamacare?

Between 1990 and 2000, long before Obamacare became law but during a time when fee-for-service was increasingly replaced by managed care, 208 rural hospitals closed.  That was almost two per month, and represented 7.8 percent of rural hospitals.

That’s not all. During that same decade 296 urban hospitals – representing 10.6 percent of all urban hospitals – also closed.

So maybe the 1990s was just an off-decade for hospitals. It wasn’t. Between 2000 and 2010, more than 300 hospitals also closed.

If anything, Obamacare preserved access by reducing the number of rural hospital closures.

That’s not all. The most vulnerable rural hospitals today are in states that did not expand Medicaid as part of Obamacare.

That makes sense. The primary reasons hospitals close is because of low patient census or business decisions (i.e., lack of revenue). By insuring millions more, Obamacare gave hospitals more patients with funds to pay for their health care.

All this is threatened by the new American Health Care Act (AHCA) that is barreling through Congress without a fiscal note.  There’s a reason for this – when the analysis comes back, rumor has it that AHCA will dump up to fifteen million people from the insurance rolls.

That means that if AHCA “Trumpcare” "repeal and replace" bill passes more hospitals and other healthcare providers will start shuttering up their doors and windows again.

It didn’t have to be like this. 

Two of the reasons private health insurance is so expensive are that Medicaid historically doesn’t pay what it costs to provide care and uninsured people can’t pay anything. 

If you make more people uninsured and put even less money into the Medicaid program, the price of private insurance will go up.

And that’s exactly what this confusing new AHCA will do. It will immediately shift $200 billion of federal Medicaid costs over ten years to the states, by using 2016 as the base year for the new Medicaid payment schedule, adjusted by an inflation factor that underrepresents the true cost of the program.

It will reduce the federal share of the Medicaid expansion, eventually forcing states to cap the number of enrollees.

It will not give states greater flexibility to manage their Medicaid programs, but will require states that want to innovate to go through a laborious waiver process.

And as people lose their private insurance, instead of taking them into the Medicaid program, the federal government will create a brand new $100 billion program – already one-fifth the size of the total Medicaid program from the get-go – to create high-risk pools for the sickest people. And get this – not only will those costs grow over time – but over the first six years of the program, the federal government will shift half the cost of it to the states.

Sounds like Medicaid redux, doesn’t it?

The reality is that Medicaid needs reform. It is a big part of the reason that we find ourselves in the jam we’re in.  But this isn’t close to the way to reform it. Giving states flexibility to keep their populations healthier and wealthier is.

But don’t tell Ben Stein, Grover Norquist, or Jeffrey Lord that. They’re all too smart, too wrong, and too confused, for their own good.