According to former Vice President Joe Biden, his proposed healthcare plan will “make health care more affordable,” and expand on the current usage of Obamacare.
In fact, Barack Obama was noted to have said almost the exact same thing about the Affordable Care Act or Obamacare. In 2009, he said, “I believe it makes more sense to build on what works and fix what doesn’t, rather than try to build an entirely new system from scratch.” Sound familiar? He also claimed that Obamacare would offer insurance to those who don’t have it and make it more affordable.
And yet, Biden is saying the same thing about his version of Obamacare known as the Affordable Care Act 2.0.
His campaign recently tweeted, “My plan to protect and build on Obamacare will not only provide coverage for uninsured Americans but will also make health care more affordable for those who already have coverage.”
This, in and of itself, admits that Obamacare didn’t work for America. And Biden knows it. Otherwise, he wouldn’t be offering up changes to it.
However, we aren’t so sure it will be any better.
Firstly, the plan would expand the current subsidies to purchase insurance. Under Obamacare, subsidies are only limited to those earning above $50,000 annually. In contrast, Biden would limit premium costs to 8.5% of a person’s income, regardless of what that is, allowing more people to qualify for healthcare assistance.
Additionally, Biden’s plan would offer more coverage with lower deductibles, increasing both the use of healthcare and the cost of subsidies to the government.
The plan would also offer a “public option” that would be available to the 4.9 million some Americans that are eligible for Medicare but live in the 14 states that do not participate in Obamacare.
However, in offering these changes, it would significantly change the world of healthcare and actually make it more expensive for the average American.
Reducing the costs for patients to be seen by healthcare providers and hospitals will make it difficult for those providers to earn the money they need to stay in business. In fact, according to a study by the Partnership for America’s Health care Future found that as many as 55% of rural hospitals across 46 states would not be able to stay open. And with health insurance options that make it more feasible to be seen, it means more patients would seek out healthcare more often but with much fewer doctors and facilities available.
Another problem it brings is that because Biden’s option might be more affordable upfront, more and more people would want to exchange their employer-based insurance in. If he genuinely wants to make it an opportunity for everyone, one of two choices will have to be made. For those who want to buy insurance through the ACA exchange, will they be offered only the government option or private plans too? If they are now eligible for government subsidies, it means the cost that employers would have been responsible for will soon be paid for by the government, increasing the federal deficit. However, if they are restricted as they are now, then the plan isn’t really available for just anyone.
Additionally, as more and more people choose Biden’s plan over their employer-based insurance, employers will eventually find it not feasible to offer their private insurance. So, for those who want to keep their coverage, it will no longer be an option, making Biden’s plan no better than Sanders’ in getting rid of all private insurers.
Biden claims that his plan will be paid for by increasing the long-term capital gains tax on wealthy Americans and by repealing the Trump tax cuts. However, as the Tax Policy Center states, “taxpayers can always avoid paying capital gains tax by simply not selling their assets. For that reason, a higher long-term maximum capital gains tax rate may not generate much additional revenue.” And they added that “raising the 20% tax on long-term capital gains to 25% would generate less than $25 billion from 2018 through 2027.” Not nearly enough to cover the $750 billion bill for Biden’s plan.
This, coupled with the fact that the bulk of the Trump tax cuts will have been delivered by the time someone else takes office means even less revenue will be generated.
In short, his plan isn’t reasonable. Obamacare isn’t working, and expanding on it won’t help either. It will only make matters worse and more expensive.