Life in the era of the Big, Bad Bill
And the consequences of bad laws and bad lawmaking
The “Big, Beautiful Bill” is off to Donald Trump’s desk. There’s little need to rehash much of the specifics here. It contains tax cuts for those making around $250,000/year or above, and it pays for them by taking SNAP (food stamps) and Medicaid way from poor people. Somewhere between 10 and 20 million people will lose their insurance - either because they no longer qualify, or because the paperwork to maintain it becomes too onerous.
How bad will it all be?
Well, depends how much money you make. If you make lots of money, are not on any form of public assistance, and have private insurance, at least in the short term you should be OK.
If you’re a family of four less than 138% of the poverty level, well, it might prove to be more challenging, as you may no longer qualify for insurance.
In states like Arizona, there are trigger laws in place to reverse the Medicaid expansion if the federal government’s portion stops getting paid. So the state could see an enormous budget deficit.
The truth is, we don’t know what any of this will mean yet. We DO know that it will shift the burden of Medicaid substantially onto states - especially the ones that had accepted the Medicaid expansion.
There are a few states that never expanded Medicaid under the Affordable Care Act: Alabama, Florida, Georgia, Kansas, Mississippi, South Carolina, Tennessee, Texas, Wisconsin, and Wyoming. For them, the change should be fiscally neutral. But that’s because they left a lot of people uninsured to thumb their noses at a black president.
The Two Extremes, and Somewhere in the Middle
At one end, wealthy states like California will probably find a way to keep most or all of their citizens on Medical (their version of Medicaid). Whether it’s raising taxes or rearranging other budget priorities, California is better positioned than almost anywhere else to absorb such a body blow.
But what happens in places like Arizona? Jan Brewer’s disastrous budget cuts put the entire healthcare system on the rails. Our state’s emergency departments were drowning in patients who had lost their insurance, and previously managed chronic diseases spiraled out of control, because these patients lost access to their medications and their outpatient doctors.
Jan Brewer broke ranks with other Republican governors and accepted the Medicaid expansion not because she thought it was a good idea, but because we were drowning thanks to her budget cuts.
States like Arizona and neighboring New Mexico don’t have the same financial reserve as California. Kicking people off Medicaid is going to hurt.
But regardless, the burden is shifted to the states. In the end it will not be the federal government telling people they no longer have insurance - it will be state houses and state legislatures.
Taking away people’s insurance doesn’t make them more healthy
This should be obvious, but to many pencil-pushers it’s not. While their spreadsheets tell them about how great it will be to get rid of the loafers and send their insurance premiums to Mark Zuckerberg and Jeff Bezos, they don’t consider what happens when someone - or a lot of someones - lose their medical insurance.
Patients without insurance lose access to outpatient physicians. This means that scheduled appointments to monitor diabetes and hypertension stop happening - not that these diseases are put in remission.
Patients without insurance lose access to medications. Even if they can pay out of pocket, prescriptions run out and need to be refilled. So these diseases are not only not in remission, but control is gradually slipping.
Patients experience silent progression of disease at first. As blood pressure, blood glucose, and cholesterol creep up, arteries are gradually damaged, kidneys become less efficient at filtering, and heart muscle experiences changes from chronic increased workload.
Patients undergo a serious, preventable illness. The untreated high blood pressure turns into heart or kidney failure, the high cholesterol leads to heart attack or stroke, or the poorly controlled diabetes leads to neuropathy, foot ulcers, and amputations.
At the other end of this is EMTALA (The Emergency Medical Treatment and Labor Act), which says that Emergency Departments can’t turn anyone away who has an emergency medical condition.
So when these patients’ outpatient conditions have spiraled enough that they have a medical emergency - heart attack, stroke, kidney failure, a gangrenous foot - we are required by law to care for them and stabilize the condition. That generally means a hospital admission, perhaps surgery or a cardiac catheterization, or dialysis if renal failure is neglected long enough.
All of those things are far more expensive than a PCP visit and a handful of inexpensive, readily available medications. These unnecessary complications are far more damaging to patients, their life expectancies, and their ability to continue being a productive member of society.
But this is preventable. All of this suffering. And all of this excess cost because of it.
So who pays the bill? The evil of “Back-door socialized medicine”
If a patient shows up to an Emergency Department with an Emergency Medical condition and treating and stabilizing that involves expensive procedures (like cardiac stents or an emergency amputation), we are legally required to deliver that care.
But if the patient has no insurance and can’t write a check, then who pays?
The answer is: all of us.
When a hospital or physician group renders what is considered “uncompensated care” that needs to be figured into the hospital or physician group’s operating costs - and covered by their other sources of income. This is difficult in healthcare, as a complicated and unpredictable conglomeration of factors (including things like payor mix) affect reimbursement for services.
So costs as a whole will go up. Hospitals will increase charges, but the hospital charge master doesn’t determine what a hospital gets paid - that’s reimbursement for services based upon contracts with individual insurers and CMS (The Center for Medicare/Medicaid Services). So hospitals and physician groups will lobby for increased reimbursement to cover the costs of uncompensated care, shifting the burden back onto the insured.
Hospitals and physician groups will also use the other avenue available for businesses to foist bad debt back onto the taxpayer - writeoffs on their taxes. This is doubly insidious. Reimbursement overall hovers around 30% of what is billed by hospitals (as I said, the charge master has little to do with actual reimbursement). But when healthcare entities go to the federal or state government at tax time, they’ll be writing off the loss at retail (charge master) rates.
So through a variety of mechanisms that are not uncommon in businesses dealing with bad debt, the cost of care for the uninsured/underinsured is pushed back to the taxpayer.
So why would a socialized system be better?
Right now, “back door socialized medicine” forces taxpayers to cover the costs of care for the uninsured and underinsured in ways that are neither accountable nor transparent, because these costs are amortized over the system as a whole.
So going to a socialized system (whether it’s single-payer or a hybrid like we have now) would better allow for accounting of actual costs.
One more dirty little secret: Insurance plans function like airlines. There are multiple models - fee for service, preferred provider organizations (PPO’s), health maintenance organizations (HMO’s), - and there are different insurers with different levels and quality of coverage. Each of them negotiates a different price with their member providers and hospitals.
While the Medicare reimbursement rate tends to be the standard that others are measured against, there can be substantial differences in actual reimbursement. Also, with HMO’s and PPO’s (which purport to keep insurance costs down), they do so by functioning like gym memberships - trying to enroll lots of the “new year’s resolution” crowd, who will pay into the system but not use it much.
All of these things make it hard to know what the actual cost of a given service is, though it’s clear that each patient pays something somewhat different.
Fiscal conservatives ought to welcome a single-payer system. Right now it’s nearly impossible to do cost containment in a way that tracks the true cost of healthcare for individuals, and ensures that they get the services they need at the lowest cost.
Federal money for state-administered programs - Opportunities for Activism
The primary administration for Medicaid is with each state, so it’s going to be the states that have to confront things like new work requirements, and people being kicked off Medicaid - and the consequences of it.
This may actually work to Democrats’ advantage.
The angry protests are going to move from Congress to state houses across the nation. State and local politicians will have a far more difficult time evading their constituents and their concerns. They will be confronted directly - and at the ballot box.
But the biggest opportunity for activism is that the GOP has hung an enormous weight around their necks. This bill was passed with zero Democratic support, and over long and loud Democratic objections. Beyond that, organizations like the Congressional Budget Office (CBO) warned of ballooning deficits and the loss of healthcare for tens of millions.
There’s the famous “Murkowski carve-out” that, while it didn’t make it to the final bill, showed how one long-serving senator knew how harmful the bill would be, and rather than saying “Wait, we can’t do this to twenty million Americans” instead chose “If you exempt Alaska from this I’ll keep my mouth shut.” A grim reminder that Republicans are on the take for themselves, and could care less about the well-being of the nation as a whole.
It even has a Trumpian name: “The Big, Beautiful Bill” - even though it’s one of the ugliest pieces of legislation ever passed.
This bill is about greed. It’s about attacking the poor and vulnerable. And given the correlation between race and socioeconomic status it is - at first blush - about racism.
But let’s be clear - there’s a lot of poor, white people, especially in Republican-controlled states who are going to be hurt by this bill. They’re not going to be happy, either.
What do we do next?
Well, let’s take a few days and take stock. This bill has been like an impending cancer diagnosis. And as awful as it is, at least now we will be fighting something tangible, and not just shadow boxing.
Once we’ve had a breather, we need to start gathering data. What happens with hospitalizations? What happens with complications of preventable diseases? What happens with the amount of bad debt hospitals write off? What happens with insurance premiums?
But we also need to engage on a narrative, “vibe” level. Dry numbers alone don’t tell as compelling a story as interviewing someone for TikTok in a hospital bed after they’ve had their foot cut off following having their insurance cut off.
Start appealing to traditionally GOP constituencies - and not just the poor, white folks who are losing their insurance. Appeal to the well-off Republican physicians who are losing reimbursement. Appeal to the state Republican politicians who are going to be managing the fallout.
Take a breath. But fight back. And get ready for the long fight, because it’s just beginning.