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DAVID KRUSE

By Staff | Mar 24, 2017

Wasn’t it a hoot that Nancy Pelosi didn’t want to vote on the GOP heath care plan until the costs and numbers covered were determined? That was a turnaround to voting on the Affordable Care Act when she said that they needed to pass it in order to find out what was in it.

I opposed Obamacare when passed because the insurance companies were in favor of it. That told me that it would do nothing to rein in soaring health care costs. It would just feed the lion.

Ironically the insurance companies were wrong. They thought that the ACA would bring them so many new customers that they could afford things like no exclusion for pre-existing conditions, coverage of children to 26 and no lifetime caps on coverage, but they were wrong, and have been bailing out of the exchanges.

Too many healthy people opted to decline coverage and the penalty was not enough to cover the cost. It did nothing to dampen spiraling health care costs and in fact, added to the inflation.

Farmers (self-employed) were probably the single targeted group hurt the most by Obamacare. Personal policy premiums soared, most of the assurances such as grandfathered polices disappeared through loopholes and farmers and self-employed ended up paying Obamacare taxes as insult to injury. Premiums soared and deductibles did, too, so we paid more for less coverage.

No company or group is helping farmers with their premiums. Low income farmers qualify for the exchanges, but health insurance costs make it much more difficult for a living income to cover needs. The number of acres farmed needed to cover health insurance premiums surged as farm incomes declined to where health care costs became a major family cost of living issue.

Farmers are looking for off-farm jobs again for the health care benefits.

The one thing that the GOP health care plan has going for it is that farmers/self-employed will not have to pay twice for health care (no taxes). I think that they will still have access to health care at the premiums they have been paying, but they will not have to pay the taxes on top of it.

The taxes are repealed on an early 2018 timeline. Tax relief is still a year away if enacted. Medicaid changes don’t kick in until 2020. I agree with many criticisms of the ACA.

I thought that critic Jim Jordan, one of the conservatives, hit it on the head when he said that the ACA provided insurance but higher deductibles killed coverage. It was affordable insurance with unaffordable deductibles so that health care coverage was not as extended for as many as was advertised.

Insurance doesn’t equate to coverage. So far, the GOP has not been what I would call transparent about their replacement bill. They tout that it provides “access”. We all have access to go to heaven but not all of us may get there. Access doesn’t necessarily equate to coverage.

What conservatives hated most about the ACA was the individual mandate. The GOP version replaces the mandate with something that conservatives care little more for – tax credits. The Wall Street Journal outlined the credits saying, “Under the House GOP proposal, the refundable tax credits would be tied to age, with people under 30 eligible for a credit of $2,000 per year, increasing steadily to $4,000 for those over 60.

The size of a tax credit would grow with the size of a family, but would be capped at $14,000. To assuage the concern among conservative lawmakers that the credits would be available to wealthy Americans, the tax credits would start to shrink for individuals making more than $75,000 or households making more than $150,000.

For every $1,000 in income over $75,000, the tax credit would be reduced by $100.

The Republican tax credits, ranging from $2,000 to $14,000 for families, would be refundable, meaning even people with no tax liability would receive payments. The question is whether these conservatives will nix this effort based on ideology? The voters want solutions to problems and Trump’s lack of ideology was one of the reasons they elected him.

Will the GOP plan pay for itself? No. Will the GOP cover as many people? Doubtful.

The bill will struggle to live up to the salesmanship accompanying it.

This plan would appear to be less onerous to farmers/self-employed than the ACA was but it will create its own set of winners and losers.

They are so enthralled with focusing on how to hang on to the tail of the lion they have not figured out how to stay out of its jaws.

The U.S. health care system is on a path to consume a threateningly unhealthy amount of consumer disposable income unless cost is addressed. I am not confident that Medicare is sustainable. Just because Donald says he will not touch Medicare doesn’t mean the day is not nearing when there is no other choice but to touch it.

Many in the GOP know that and are ignoring the President’s pledge by looking at changes.

The AARP opposes the GOP replacement bill because they believe that it will harm the group of 50 to 64-year-olds who are pre-Medicare. The AMA, hospital association and insurance companies all oppose the GOP replacement proposal. That must mean that it is not that bad of a plan.

These entities supported the ACA, which I noted meant it wasn’t a good bill and one of the reasons that I opposed it. With a two-vote GOP majority in the Senate and 22-vote majority in the House, politicians will do what they do best which is attempt to wrangle something they want in return for their support.

What is pushing the GOP is that they were not elected to fail. They put health care up first on the agenda for a reason. It was easier than what comes next.

If they can’t govern heath care, the GOP brand fails and self-destructs. That will be strong motivation for them to come together.

David Kruse is president of CommStock Investments Inc., author and producer of The CommStock Report, an ag commentary and market analysis available daily by radio and by subscription on DTN/FarmDayta and the Internet.

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