I wrote to you earlier this year when the AHCA was under consideration, and I do want to thank you for taking the time to reply. Just to remind you of my personal stake in this debate, my wife was diagnosed with cancer last year, and her treatments were covered under our ACA policy. If the ACA is phased out by 2020, I will be covered under Medicare. My wife, however, will not qualify until 2032. She is in remission now, but I haven't the least doubt that if the bill you are sponsoring became law and underwriting requirements were waived in SC, we would not be able to afford coverage.
It's clear that you and I have different ideas on how the nation's health care concerns would be best addressed, and I don't expect to win you over with appeals to your sympathy. I've long respected your reasoned and pragmatic approach to a number of issues, however, so there might be more in common in our viewpoints than either of us suspect.
I note that you and I were both law students at the University of South Carolina in the late 70's. I graduated in 1979, after you had just completed your first year. I'm sure if we ever got together for a beer we could share some fond memories about Prof. Lightsey's rambling lectures in constitutional law, Prof. Lacy's provocative UCC hypotheticals, Prof. Wedlock's impassioned advocacy for the accused, or Prof. Freeman's sobering insights on the code of ethics. While in law school, I spent much of my spare time at Russell House, writing for the Gamecock and deejaying at WUSC. One of my more interesting assignments was to interview your predecessor, Strom Thurmond, and his opponent, Charles Ravenel, during their campaign for the senate in 1978.
I was enrolled in the combined JD MBA program. One of my business classes in risk and insurance left me with a profound impression about a basic flaw in our health care system that has become more and more apparent in the years since. It's a pretty simple concept, but one that many people don't think about. From a consumer's perspective, the risks it makes the most sense to insure against are those with a very low probability of happening, but a very high cost if they do. From the insurer's point of view, it's the exact opposite. The insurer would like to cover risks that have a high probability but low cost, making it very easy to balance income from premiums against payouts for insured losses. The assumption that consumers behave rationally is demonstrably flawed as applied to insurance markets. There is actually research showing that people will choose capped policies with lower premiums and deductibles, suggesting that they think of health insurance as an investment rather than a transfer of risk. The prevalence of health insurance caps prior to the ACA is unmistakable evidence of how insurers are able to take advantage of consumers in an unregulated market.
As you might imagine, I have followed the news about ACA repeal legislation very closely. I can understand that people felt betrayed when Obama said, "If you like your health care plan, you can keep it," and it turned out to not be true. Quite a few statements by politicians hoping to repeal the ACA, however, have been equally egregious. According to information online about your proposed bill, it repeals the individual mandates, "Strengthens the ability for states to waive Obamacare regulations," and at the same time "Protects patients with pre-existing medical conditions." To actually believe this won't turn out to be as big a lie as the one Obama told is truly wishful thinking.
Sec. 106 of your bill clearly allows states to waive the most significant protections of the ACA, essentially removing all limits on medical underwriting that don't involve outright discrimination, and specifically allowing insurers to vary premiums based on "health status-related factor" (i.e., pre-existing conditions). States would also be able to waive requirements for essential benefits and medical loss ratios. I note that when requesting a waiver, the state must describe how it "intends to maintain access to adequate and affordable health insurance coverage for individuals with pre-existing conditions if such waiver is approved." In reality, that provision is little more than a fig leaf to give cover to claims that the bill maintains protection for persons with pre-existing conditions. It's hard to believe that the lack of detail is anything but intentional, allowing waiver applications to provide their own interpretation of what constitutes "access", "adequate", and "affordable". Indeed, since the term is not used anywhere else in the bill, even the definition of a "pre-existing condition" is left to states in their waiver applications.
I have seen estimates that as many as 4 million people lost their insurance as a result of the ACA. Estimates of the number of Americans with pre-existing conditions are at least ten times higher. Obama's catchy soundbite turned out to be Politifact's "Lie of the Year." Do the math.
An often repeated promise of proposals to repeal the ACA is that it will return control of the doctor-patient relationship to the patient. It would be more accurate to say that control would be returned to insurance companies. I have signed up for insurance four times now through healthcare.gov, and the only question I've had to answer about my health is whether I smoke. I still remember what it was like getting individual insurance before the ACA. Presumably, the individual mandate is a major part of the idea that the ACA gives control to the government. Some even go so far as to say that healthy people shouldn't be forced to pay for health care for sick people, even though that is exactly how insurance is supposed to work. I would offer a different response to those who would choose to forego insurance: they are effectively freeloaders. They refuse to take responsibility for the risk that they might become sick, believing that if they are unable to pay their medical bills, the emergency room will still have to care for them and the bankruptcy court will cancel their debt.
Regarding the idea of "strengthening" states' ability to waive regulations, it would be more to the point to say the proposed repeal bill weakens the patient protections guaranteed by the ACA. In its current form the ACA already allows states to apply for waivers. To be approved, waiver applications must not cause benefits to be cut, premiums to increase, or people to lose coverage. These seem like reasonable requirements to me. Several states have submitted applications, so it's not as though the requirements are impossible to meet.
I fear your bill would simply be a return to the days of insurance caps and medical underwriting, long recognized as a formula that allows health insurers to skim off the young and healthy, leaving the sick behind. If allowing coverage caps and eliminating requirements for essential benefits resulted in any lowering of premiums, I believe such a change would be temporary at best. As more people become uninsured, either by choice or because they can't afford the premiums, many of them would not get the care they need and would end up in emergency rooms. Uncompensated care would increase, eventually becoming a significant drag on the rest of the economy.
I recently completed a course in health care analytics, which covered some of the latest research on how to improve health care quality while holding costs down. Many who know a lot more about health care economics than you or me believe the most significant factor contributing to our high health care costs is our reliance on fee for service. When providers are paid to keep people well rather than performing numerous tests and procedures that offer little benefit, costs will go down. The ACA took steps in that direction with the Hospital Readmissions Reduction Program. I have seen nothing in the ACA repeal proposals that is truly calculated to bring down costs, save the tired mantra about competition and the free market.
Not just for my sake, or for that of millions like me who themselves or whose loved ones have pre-existing conditions, but for your own legacy and perhaps the political future of you and your party, please withdraw your bill.