The Real Reason American Healthcare Fails to Get Repaired Is More About Business Than Politics
The real reason American Healthcare fails to get repaired is more about business than politics. When you analyze the setbacks, especially of that first Healthcare Act that never made it for a vote, it is more about dollars than votes.
Congressional representative Billy long (Missouri) was a devout Trump supporter. He had calculated that President Trump would pick up 40 Freedom Caucus votes by amending the Healthcare Act to please the Freedom Caucus. Their first amendments had excluded emergency room visits, mental health, prescription drugs, pregnancy and defunded planned parenthood. The second amendments essentially wiped out pre-existing conditions and cancer treatment. Long who ultimately did not support eliminating pre-existing conditions had calculated that without his vote the Republicans still had 39 votes to Trumps favor. Technically, that math was correct. But in reality when the time comes for an actual vote, voters at the polls and in congress weigh their business interest against their political loyalty. The math does not exactly add up.
SUPPORTERS OF THE HEALTHCARE ACT
The major advocates pushing the American Healtcare Act were President Donald Trump in the White House, Speaker of the House, Paul Ryan and Republicans who now control both the House and Senate. With about 246 Republicans and 180 Democrats in Congress, a united Republican Party, could have easily voted to pass that first Healthcare Act. However, they did not succeed. That bill was not loss due to votes, it was lost due to billions of dollars that would have been taken from the bottom line.
President Trump and Speaker of the House, Paul Ryan had relied upon input and support from conservative groups such as the Heritage Foundation and The Freedom Caucus. In addition, moderate Republicans such as the Tuesday Group offered support and were expected to support the bill. Late, in the negotiation process a few ultra conservative republicans made changes that deleted essential coverage causing the bill to get derailed.
OPPONENTS OF THE AMERICAN HEALTHCARE ACT
It was anticipated that Democrats would oppose the bill designed to repeal parts of Obamacare. They argued that according to the Congressional Budget Office that initial bill would cause 14 million Americans to be uninsured by next year and 24 million to be uninsured by the year 2026. They argued that repeal took one trillion in Obamacare tax credits and made $880 billion dollar cuts in medicaid. The repeal would have taken from those in need by reducing tax credits needed to pay health insurance premiums or get health coverage. It would have transferred that money to Americans with higher incomes. Instead of a healthcare bill, opponents viewed it as a strategy to transfer wealth from those in need and give it to wealthier Americans to fuel their wants. Democrats opposed the views of conservative Republicans as too conservative. Despite their opposition, democrats alone did not have the votes to stop the passage of the American Healthcare Act.
THE ADVANCED PREMIUM TAX CREDIT UNDER OBAMACARE
Generally, a tax credit is received at the end of the tax year when you file your federal income tax return. It comes in the form of a tax refund. However, the Premium Tax Credit under Obamacare that helped Americans obtain health insurance came in the form of an ADVANCED CREDIT paid directly to the health insurance company to pay a portion of the monthly health insurance premiums. At the end of the year, when federal income tax returns are filed, adjustments are made that may require that taxpayer to repay a portion of those credits received. This repayment is in additon to other federal income taxes due.
For Americans with limited incomes, seniors with fixed incomes who did not yet qualify for medicare, and small business owners with cyclical incomes or rural Americans where job opportunities were limited, this Advanced Premium Tax Credit helped them to maintain health insurance coverage throughout the year. It paid a portion of their monthly health insurance bill. Without it their monthly health insurance premiums would not be paid causing their health insurance coverage to terminate. The reason the first American Healthcare Act got derailed was not because of these people, they could not vote in Congress.
The first American Healthcare Act that Paul Ryan worked so hard to get passed reduced the maximum amount of the Tax Credit from $6,000 per year to $4,000 per year. This reduction meant that the monthly credit received each month that went to pay the premium to maintain health insurance coverage would drop from a maximum of $500 to $333 a month. Taxpayers in this income category would need an additional $167 cash each month to make up the loss in order to maintain their same health insurance coverage. As lower income taxpayers lose coverage they end up with no coverage or may end up on medicaid, which takes away options to see doctors of their choice – doctors who are more concerned about their health rather than simply pushing prescription drugs that have side-effects or cause worst health problems.
SUPPORT FROM THE HERITAGE FOUNDATION
That first Healthcare Act had the support of The Heritage Foundation, a non profit 501(c ) (3) organization founded in 1973 to promote free enterprise, limited government, individual freedom, traditional American values and strong national defense. With more than 500,000 dues paying members, it’s primary audience includes, members of Congress, key Congressional staff members, policy members in executive branch, the nation’s news media and the academic and policy communities. It accepts no government funds and performs no contract work. Heritage experts appear on television dozens of times each week. It has offices 1,000 steps from the House and 500 steps from the Senate, giving it access to law makers and public officials.
SUPPORT FROM THE FREEDOM CAUCUS
The first Healthcare law to repeal and replace Obamacacare also had the support of The Freedom Caucus, a group of about 36 far right Republican Congressional members. They are the youngest members elected to Congress. As of October 2015, Congress was made up of 435 members; 47% had served 1 to 3 year terms; 32% had served 4-9 year terms; and 20% of Congress had served more than 10-year terms. The members of the Freedom Caucus came from safe districts. Unlike many Congressional representatives who get voted into office, they did not feel threatened by a “no compromise brand of conservatism” or taking anti-establishment positions.
The Freedom Caucus was chaired by Rep. Mark Meadows, (NC). Other members include or have included, Justin Amash (MI), Joe Barton (TX), Brian Babin, (TX), John A. Behner (OH), Rod Blum (Iowa), Jim Bridenstine (OK), Mo Brooks (AL), Ken Buck (CO), Warren Davidson (OH), Ron Desantis (OH), Scott Desjarlais (TN), Jeff Duncan (SC), Trent Franks (AZ), Tom Garrett (VA), Paul Gosar, Jr. (VA), Morgan Griffin (VA), Andy Harris (MD), Jody Hice (GA), Tim Jordan (OH), Raul R. Labrador (Idaho), Thomas Masscre (KY), Alex Mooner (W. Va), Gary Palmer (AL), Steve Pearce (NM), Scott Perry (PA), Ted Poel (TX), Bill Posey (FL), Mark Sandord (SC), David Schweikert (AZ), Randy Weber (TX), Ted Yoho (FL).
With Paul Ryan’s experience as former chairman of the House Ways and Means Committee, and former chairman of the House Budget Committee, plus with sixty-six more republican than democratic votes, mathematically the bill seemed certain to pass. However, behind close doors what appeared to be politics as usual, was trumped by business interest that was more valuable than party loyalty.
After the Freedom Caucus amendments were made to that first Healthcare bill, the second version eliminated pre-existing conditions and treatment for cancer. House and Senate voting representatives had to consider to what degree their consituency would be pleased (or displeased) with these changes to Obamacare. This position could leave voting Congressional members stressed between the interest of their constituency that vote them into office and other financial interest that keep them in office. Some wonder why there is such a wide discrepancy between expected outcomes and the actual votes (in Congress and at the polls). The reason may be that voters (in Congress and at the polls) are not honest about how they really intend to vote because it may conflict with other interests. (To see how sabotage is a mirage read Business Leadership and Success). The real reason the first American Healthcare Act got gutted, before reaching a vote in Congress was more about business than politics.
ELEVENTH-HOUR CHANGES DEMANDED BY THE FREEDOM CAUCUS
Just days before Congress was expected to deliver the necessary votes allowing President Trump and the Republican party to gain their first major victory in passing the American Healthcare Act, the Freedom Caucus demanded essential changes to the bill. This demand was in order to keep their support. However, the extent of these changes reduced “Essential Coverage.” The Freedom Caucus’ position offered no negotiating room what-so-ever, rather it came with a firm take-it-or-leave-it position. Their demands included, (1) excluding mental health coverage; (2) excluding emergency room coverage; (3) excluding prescription drug coverage; and (4) excluding maternity benefits and defunding Planned Parenthood.
FREEDOM CAUCUS CHANGES CREATED A FIERCE FIRE OF OPPOSITION ACROSS AMERICA
When these changes to that first American Healthcare Act hit the media they fueled a fierce fire of opposition against the Healthcare Bill. Opposition mounted on both sides from groups, including AARP representing over 35 million members over 50 years of age, women’s groups, The American Medical Association, and various other medical organizations.
The eleventh-hour changes made tempertures rise and opposition mount. Even middle-of-the-road Republicans suddenly felt uncomfortable supporting that bill. As time approached for that first vote, the mood of opposition escalated.
ELIMINATING MENTAL HEALTH COVERAGE WOULD HAVE SHAVED BILLIONS FROM THE BOTTOM LINE
The Freedom Caucus’ position appeared to be that of a proponent of excluding mental health coverage. However, this outcome would have resulted in drug companies losing billions of dollars for drugs that would no longer be paid for by insurance companies. This would have taken away billions from the bottom line of pharamaceutical companies. Strategically, the Freedom Caucus seemed to propose a measure that they really wanted to fail, while making it appear to be Ryan and the President’s failure.
When Obamacare was passed, the real party of interest for mental health benefits were the pharamaceutical companies whose drugs were mandated to be paid for by insurance companies. Mental health benefits help 70 percent of Americans who use them daily to cope with life and/or may have substance abuse issues. The math and the bottom line seem to indicate that more important than politics were the billions of dollars in sales gained by the pharamaceutical industry. Stripping mental health coverage from health insurance plans would have resulted in a huge market loss. That market loss converted to a big financial loss, if drugs were no longer mandated to be paid under health insurance plans.
Freedom Caucus member Jim Jodan of Ohio, had the support of the Ohio Tea Party. Ohio was one of the few states with more than one health insurer remaining, but Ohio ranked 37th out of 50 states with the worst provisions for mental health. Damage from drug use, substance abuse, and addictions has negatively impacted many states, some more than others. Ohio Govenor John Kasich had recently reported that a major coverage utilized in Ohio was the mental health coverage. If this was true, how could Freedom Caucus member, Jodan have possibly intended to support the very amendments he proposed in that first Healthcare Act. The Freedom Caucus’ take-it-or-leave-it position created a show down that shut down the votes needed for that first Healthcare bill to pass.
ELIMINATING EMERGENCY ROOM VISITS WOULD HAVE SHAVED BILLIONS FROM THE BOTTOM LINE
Eighty percent of emergency room visits involve drug therapy. Two hundred ninety-six million drugs are ordered or provided through emergency rooms. Removing emergency room visits from mandatory health insurance coverage would have damaged the bottom line of drug companies. Eliminating this coverage from that first Healthcare Act would have caused a substantial drop in ER visits, and in turn caused a loss to the profits of pharamaceutical companies. Again, strategically, it seems that the Freedom Caucus proposed a measure that they really wanted to fail. They appeared to support it but let it appear to be someone else’s failure.
ELIMINATING PRESCRIPTION DRUGS WOULD HAVE SHAVED BILLIONS FROM THE BOTTOM LINE
The National Center for Health Statistics, an agency of the Center for Disease Control reported that in 2015 the number of Americans that have used at least 1 prescription drug in the last 30 days included: 52 percent of whites; 36% of Hispanics; and 43% of Blacks. This amounts to a large profit to the bottom line of pharamaceutical companies. Losing coverage for prescription drugs in that first Healthcare Act would have eliminated this market share and wiped out a huge profit for pharmaceutical companies. Again, it seems that strategically, the Freedom Caucus proposed a measure that they needed to fail, while appearing to be someone else’s failure.
Paul Ryan opposed these changes advanced by the Freedom Caucus’s amendments to that first Healthcare Act, but Ryan and the GOP needed their votes. Paul Ryan believed their votes would be forth coming. From his experience Ryan believed that the substative nature of these changes would likely cause the bill to be rejected procedurally before making it to the Senate floor. Ryan preferred a more stripped down version as a restoration of Obamacare than stripping it of essential coverages. Ryan and President Donald Trump were willing to accept the changes insisted by the Freedom Caucus on short notice in order to get the bill passed.
Senator Ted Cruz argued that even if rejected, Vice-President Pence, who serves as President of the Senate could overturn the parlimentarian of the Senate. This likely would have created more friction between the executive branch and the legislative branches of government. This outcome could have resulted in a court battle to determine whether fifty-one senators and the vice-president can redefine the law.
WOMEN’S ISSUES INVOKE SENSITIVITY FACTOR
Each member of the Freedom Caucus represented a state with a majority of women in the population. Whether Republican or Democrat, stripping essential coverage for Planned Parenthood and maternity benefits caused a mood of “familiarity” to be stirred as sensitivity gained value in the hearts of mothers, sisters, and daughters who could relate. Issues that previosly were not relevant suddenly were perceived differently and became substantively meaningful. This caused women’s sensitivity meter to heighten. In turn, it drove up the pressure for the masses to oppose the bill. Probably, the very proponents of these measures to strip both maternity and Planned Parenhood benefits, felt uncomfortable voting for it. One could easily assume that the Freedom Caucus had calculated that removing their 36 votes from the table would certainly cause that first Healthcare Act to fail if it went for a vote in Congress. If you publicly support a bill that you secretly really want to fail, this is a convenient way to do it.
Proceeding to a vote on the first Healthcare Act would have been far more disastrous than removing the bill from the table. It would have been convenient to blame the loss on Paul Ryan for failing to deliver, if that Bill had gone for a vote and failed. That outcome would likely have damaged President Trump’s reputation as a master negotiator, especially since he authored Art of the Deal. In addition, proceeding to an unsuccessful vote may have severed Paul Ryan and the President’s relationship, an outcome possibly designed to leave a vacant seat for The Freedom Caucus to fill with one of their own. All along, a deeper strategic plan behind the failure of the American healthcare system seems to be more about business than politics.
When Paul Ryan and President Donald Trump agreed to include the non-negotiable demands of the Freedom Caucus into that first Healthcare Act, they expected 36 votes in exchange. In the end, the Freedom Caucus got their demands added into the bill, then withdrew their support, causing the bill to sink. Summing it all up, the real reason that first American Healthcare Act failed to obtain the necessary votes is the same reason amending or repairing healthcare legislation in America today is so contensious – it is more about business than politics.