When Pam Howard and her husband started their business in Jacksonville in 1999, they took a chance not just with their money, but with their health.
The couple bought health insurance for their kids, but not for themselves.
“Then I got really sick and we lost our home and car, we lost everything,” Howard, 58, said referring to the costly medical bills. “And after the bankruptcy, I couldn’t get anything through insurance because I had a pre-existing condition.”
Howard now has insurance she bought on the insurance exchange through the Affordable Care Act, but she worries that she won’t be able to afford it under the House Republicans’ plan to repeal and replace Obamacare.
Howard isn’t alone in her worries. Since its unveiling last month, the Republican replacement plan has picked up critics on both the left and right. The Congressional Budget Office predicted the plan would cost 24 million people their health insurance. And state officials in Alabama, many of them critics of the ACA, have expressed concern that the Obamacare replacement would upend state budgets.
No reset button
The Republican healthcare bill wouldn’t return the country to the way things were before Obamacare, but it would change the financial math for the people who got insurance through the ACA.
Right now, Alabamians who don’t have employer-provided health insurance can buy it on a federally run exchange. Federal subsidies pick up part of the cost, and people who still don’t buy will face a tax penalty.
Under the new plan, people will get tax credits of $2,000 to $4,000 to buy insurance. People won’t be required to buy, but if they go without coverage for a while they’ll be penalized with higher prices for the first year when they buy insurance again.
“The people who are the most negatively affected arelow-income older adults in high-cost areas, which are usually rural,” said David Becker, a professor of health care policy at the University of Alabama at Birmingham.
Becker said young people are already cheaper to insure, and they’re most likely to take the risk of buying insurance plans that offer less coverage.
Under the House plan, tax credits would increase as people age, with a 27-year-old getting $2,000 per year while a 60-year-old would get $4,000. But everybody across the country gets the same tax credit, no matter how much insurance costs in their state. Under the ACA, subsidies are adjusted based on the customer’s income and the cost of a plan.
“It’s estimated that Alabama subsidies would be about $4,000 per person less under this plan than under the ACA,” said Don Williamson, director of the Alabama Hospital Association.
When the Kaiser Family Foundation earlier this month did an analysis of the House health plan’s impact, the group used Mobile as its model of a community with high health costs. Under their analysis, a middle-income 40-year-old would be better off by about $400 per year under the Republican plan.
But a middle-income family of four and a middle-income 60-year old would come out worse. So would low-income Mobile residents at all age levels. A low-income 40-year-old, for instance, would lose $2,725 under the Republican plan.
‘You get into lower quality’
At 28, Matt Tyson of Anniston is at the young end of the health insurance pool. With a wife and three kids, he’s not interested in going without insurance, or buying a pared-down plan.
“I really don’t have another option for insurance ... this is the most affordable plan I could find with the best coverage,” said Tyson, who pays $69 per month for an ACA plan. “Any plans with lower cost than that and you get into lower quality of health care.”
Tyson works at the Right Place, a local nonprofit that helps the homeless. His wife, who had an employer-provided plan, had to quit her job to take care of the kids, including a newborn. Tyson said they’d pay $300 to $400 per month for health care without subsidies.
Tyson said he’s skeptical of the tax credits because they don’t change as premiums rise and because subsidies are paid up front each year.
“For tax credits, it always depends on how your expenses go each year ... a lot of the time the two don’t line up well,” Tyson said. “It’s better to just have the money up front to buy the plans.”
Debbie Cox, 64, of Golden Springs is already convinced her health plan is going away.
“It's the best insurance I’ve ever had and I’m really upset I’m going to lose it,” Cox said.
Cox survives mainly on Social Security. Her husband is on Medicare.
She pays $31.38 a month for her plan’s premium. She also pays $23 a month for a dental plan through the ACA.
“I use it,” Cox said of her health plan. “I have pre-existing conditions and need pain management.”
Cox said that through her plan, it costs $15 out-of-pocket to have one of her prescriptions refilled. Before she had the plan, that same drug cost her $200 a refill, Cox said.
“Also on this plan, if I’m airlifted, it’s 100 percent paid for and an emergency room visit is 100 percent paid,” Cox said.
Cox said she’s seen the Republicans’ proposed health plan tax credits and knows they’re not enough.
“They wouldn't add up to what I’ve got now,” Cox said.