New healthcare plan and how it impacts you and your family's healthcare costs and coverage
Congressman Kevin Cramer joined us to discuss the new Republican healthcare plan and how it will impact your family's coverage and expenses.
(Please note - this transcript was copied from an electronic captioning service. We apologize for any errors, spelling, grammatical, or otherwise.)
Tonight we're going to take a simplified approach to the new GOP healthcare plan. They're calling it the American healthcare act. So that you at home can really better understand what this new plan really means for you and your family's healthcare costs, as well as your coverage. Good evening and welcome to "Point of View." I'm Chris Berg. Thank you for joining us. There is a great, an interactive web site right now with the family foundation that allows you to look your specific county that you live in and it compares the Obamacare tax credit or subsidy to the new GOP plan tax credit. I want to give you a couple of examples to show what you I'm talking about. If you live in Cass county, 40 years old and earn $40,000 per year, you can see here that the new house plan gives you $2,400 more in tax credits to help pay for your health insurance cost. Now, if you're 60 years old, you live in Cass county, you earn roughly $40,000 per year, you can see the Affordable Care Act would actually provide a greater amount of tax credits to help you pay for your healthcare expenses. Again, if you want to finding out more information, head to the web site at the Kaiser family foundation. You can find out more specifics about the actual county that you live in.
Tonight we're going to simplify the healthcare plan and tell what you it means specifically to you and your family right here in North Dakota, is our Congressman Kevin Cramer joining us live from Bismarck. Always great to see you. Thank you so much for your time. There is a ton of politics around this bill. I really want to take some time and focus on the people here of North Dakota. You know better than I do there's a ton of fear and anxiety when you start talk being people's healthcare. Hopefully we can get some truth and mitigate some of the fear and anxiety. I want to start with this, you look at what I just mentioned about people 50 to 64, middle to lower class, predominantly the people in rural America that voted you and now President Trump in office and yet, those exact same people are bearing the biggest brunt of this new plan. Why did you choose to do that?
So I think the example you showed is a great one. The problem is that in the Kaiser foundation does a pretty good job of sort of a static comparison. The problem is if you look at the current healthcare bill, the Obamacare, the incentive is for young, healthy people to not be in the market. That's why the individual market is imploding. So while it looks in a static sense like people that are older are paying more than people younger, the fact is we need to incent these younger people to get into the market so that everybody's healthcare costs go down. 19 poison 2 million people chose this year to not buy insurance on the exchange. They chose to either seek an exemption or most of them just pay the penalty. That's 19.2 million. Most of them, younger than 35 years old. So we need those people in the marketplace. But you can't force them in and force them to buy real expensive plan that they don't need or can't use. So we need to find that balance that gets more people into the pool and making more -- making healthcare more accessible. Not mandating it, but more accessible.
I can appreciate that. But my question is twofold now. One, 'cause you mentioned an incentive for younger people to get involved and I don't see any incentive for a young person to get involved. We can talk more about that in a minute. My real question is, again, you're talking about 50 to 64 years old. They're not at their peak earning levels right now. Many are moving on to standardized income, if you will. So why put them in the crosshairs of this bill and have them bear the greatest brunt?
But they don't, Chris. Again, you showed a static picture of it as the Kaiser foundation, yes. The tax credits are not indexed for income. They're indexed more for age because at the current time, people under the age of 40 aren't buying insurance. That's why everybody is -- this year alone, 25% is the average premium interest. Next year they expect it to be 27%. Our bill brings it down 10%.
I understand that.
The static --
I don't mean to interrupt you. Just a couple things --
The markets are dynamic.
What you've done in this bill from a legislative regulatory perspective is that Obamacare allowed you to increase the rates from three to one perspective for 50 to 64, it's five to one. I'm talk being lower to middle class 'cause you've eliminated the Obama surcharge tax for people that make over $250,000 or more. So I'm not saying it's right or wrong. I'm just curious when I think about the people that put President Trump in office, why have them bear the greatest brunt of this what appears to be at this point, this legislation?
But they don't, Chris. That's the problem with the example you showed. You showed a static example. What's happening now is those 50 to 65-year-old people, their rates are going up at an average of 25% this year, 27%. Next year, because Obamacare provides incentive for young, healthy people to not be in the exchanges. In fact, they'd rather pay a couple hundred dollar penalty than pay a several thousand dollars for insurance that they can't afford not only to buy, but they can't afford to get sick because the deductibles are so high. See, so both with the indexing of -- remember the indexing of the credits goes up as people get older. So at $4,000, that goes to that same block of people at 50 to 64, whereas the younger people get $2,000. On the one hand the market favors the younger person, but the subsidy favors the older person.
So let me ask you this, in a couple different ways, let's say I don't have insurance and I get sick. Can I then go get insurance?
Good question. It means the previous existing conditions. But you can't -- our bill provides for a 30% penalty in your insurance rates if you go without insurance for more than 63 days and then try to get it at a certain time because you want some procedure done or you have a disease or some sickness. While also accepting existing conditions, it also doesn't allow to you game the system.
Is that my incentive? 'Cause that sounds more like a mandate or a punitive measure than an incentive for me to get insurance.
Well, no. Sure, you can just not get insurance at all ever, I suppose. But that's not really fair to the poor either. If the people that need the insurance the most only buy it one time a year when they need a procedure, so again, you cannot be filling out your insurance with -- because of a preexisting condition. At the same time, we're not going to allow you to just abuse the system because you have a preexisting condition. That's why this balance was struck to provide an incentive for people to have insurance, especially if they have a preexisting condition.
I tell you what, I want to touch on a couple more things here with healthcare.
We're talking about the truth about the new GOP healthcare plan with Congressman Kevin Cramer. Staying with us with this segment as well. Thank you so much for doing this. I feel like we can spend an hour on this. I want to keep this simple and focused on the people at home. One thing I want to move on is farmers typically in the individual market. What is this plan do for someone who is a farmer, small business owner, if I'm not part of an employee insurance-based program?
Really, Chris, this is what it's aimed at more than anything, because Obamacare is -- has all but destroyed the individual market. That's what we're trying to prop up here more than anything is to restore that. That's by giving more flexibility to states. That's something we haven't talked about. Some of the things that as Secretary Tom price is able to do with help in that arena as well. What this does is restore the market. In other words, we don't create a monopoly and force you to buy into this monopoly. It gives you a credit and allows you to purchase in the marketplace the type of coverage that you need or want. And it's always challenging, Chris, when you have healthcare that's provided by an employers and then individual healthcare and then self-employed like farmers. It's farmers and ranchers and the self-employed and those on the individual market that complain by far the most. They're the ones seeing their premiums go up, but their deductibles are so high, they can't afford to use the healthcare if they have it. So none of this is perfect. It's still negotiable. We're trying to find the sweet spot. You've been talking to me about how much generosity this bill lacks. On the other hand, there are a bunch of my colleagues who think it's way too generous and they're trying to find a way to make it more conservative. That's the needle we're always trying to thread.
I want to get to the politics if we have time. I really want to focus on the people because of the anxiety this kind of situation can create. One of the things, if you can give a specific example. One thing I like is if you're part of an association, the North Dakota farmers union, North Dakota farm bureau, I can go through that association and get more of a group-type of plan to lower my cost. Can you give us a specific example for farmers that that could work?
Great example. So this bill does not do that because that would require 60 senate votes because that's a policy change. That's phase three of our plan. Only this phase one that we're able to do under reconciliation that takes 51 senate votes. What we're able to do right now. So that has to deal with revenue and deal with costs or budget. So things like buying insurance across state lines, associations like the farmers union or that -- you might have restaurants, a whole bunch of small restaurateurs across the country that can form across the country, that's not allowed under Obamacare. We need senators, 60 some. Tort reform and liability reform. We need to get to the cost of healthcare itself. So there are lots of things we have to do. The regulatory side, that's where phase two comes in. That's where Tom price, the secretary of health and human services, Obamacare, 1400 times it states what the secretary can or must do. So the secretary has a lot of authority on the regulatory side. We want to wring a lot of those costs down and make healthcare more accessible to more people, including farmers and ranchers.
I want to get your thoughts on this. You mentioned about selling across state lines. You have proponents of competition. You hear people say if we can do this, it will lower cost. What North Dakota insurance commissioner wrote about this and give you a chance to respond. He says he was at your healthcare round table. He stall Waterloo posed interstate insurance sales. He says it's already an option that's available in this nation. Not one insurance company is utilizing that. He went on to say that from ad in fundamental perspective, if I were to buy health insurance from New York or California, he now has no protection for me as a North Dakota resident, thus he's adamantly against this and says it actually will not lower costs. Are you right or is he right?
Well, I think that there is definitely middle ground that can be found here. We buy lots of things across state lines. We can buy lots of kinds of insurance across state lines. For some reason, not health insurance. I think any rational person understands that there has got to be a way to be able to create competition between states. If, for example, you belong to an association, like the restaurant association or form group, obviously that would be an interstate association. So we do lots of things across state lines where there are state regulators that still have protection over the regulation of that. But here is what I would say, and I understand, believe me, I know what the commissioner is talking about. He's written to me. We've talked about it. He was at my forum. And there is lot of things that he says are right. But I also know if what if we as a state decide we're going to have the best environment for creating healthcare insurance, health insurance? Why don't we attract the best health insurance companies in the world to our state by us having the right kinds of regulations? Let's create competition between the states as opposed to just saying, let's create -- not perfect. This is something that would be in phase three. It would be worked out with insurance commissioners and governors. But that's going to take 60 senate votes someday. 11
Let's get into a little of the politics. As you know, you spent 27 hours in your committee on this bill and you did it before the CBO score came out, the Congressional budget office score. You voted yes for it. Without having any idea combat actual bottom line impact is going to be on our budget with a nation $20 trillion in debt, voting for something that you had no idea how it was going to impact our nation, isn't that kind of like Nancy Pelosi saying hey, we got to vote on this to find out what's in it?
No, because I read it before I voted on it and I knew what kind of impact it would have. So CBO score comes out, lowers the deficit by $337 billion. It lowers taxes by $880 billion. Lowers premiums by 10%. Some insurance companies told us they could lower it even more. Those are things, they're fundamental. If you understand basic market principle, you would understand those things are probably going to happen of at the same time, CBO anticipated or estimates that 14 million people would lose their healthcare coverage. That's not a surprise to us. Right now those 14 million people are required by law to have something. Some of them don't even want. And in fact, as I said earlier, they anticipate 21 million would be on the exchanges by this point. Only 10.3 million are buying on the exchange with nearly 20 million choosing to be off of the exchange. The CB, so a static scorer. They do not consider fundamental market forces. Our bill understands that and does include market forces, create competition, create natural incentives for young, healthy people to buy insurance and get into the pools so that the rates don't go up for everybody. It comes down somewhat to what do you trust? Do you trust free markets or government mandates and monopolies?
I said last night, we need a healthcare system rather than a disease management system. Two more things quickly. You just mentioned that you had read the bill just for confirmation, for explicit -- to get you on the roared here. We know the last one was eight feet tall, have you read this entire bill?
I have, but it's not that much to brag about. It was really a tough read. Both the bill that passed through our committee and the ways and means committee, two different committees. We deal with Medicaid. Ways and means with tax and Medicare. I think a total of 123 pages. But that doesn't even begin to tell the whole story. Even just reading the bill.
Hey, that's probably more than what some of your colleague cans say. Last question, the freedom pocket is not for this particular version of the bill. They're saying they've got the votes to hold this up and it cycle reconcile in the house. Do you guys have the votes in the house to pass this?
I don't know that we have them right now. But I expect that we will because when you're -- if you're a freedom Congress member, you're confronted with choice of maintain Obamacare or using even something as generous as our tax credits system here to create market-based solution, I think the conservative in you has to go with the GOP plan. As imperfect as it might be. I also think we have a very persuasive president, very persuasive vice president and a very persuasive speaker of the house. As you can tell, everybody is out pitching it and telling it. It's a sausage making process. But it's at least engaging a lot of people.
We appreciate you taking the time to speak to us about it as well. If there is some way you can pull off a town hall with you and senator heaven, this is a long shot, but senator Heitkamp, to help mitigate some of the fears and anxieties for people across our state. Thanks for your time, sir.
That's great. I think people should know this, the Medicaid expansion, we're hanging on to it. Anybody that's covered under that, that was one of big concerns at my town hall. All of these mothers with children on Medicaid expansion, they get to stay on for as long as they need to. Well past even 2020. As long as they need to. We are not trying to pull the rug out from under people who have care right now.
We will talk more about that with you next time. We appreciate it very much.