Trumpcare: Who Benefits From the New Plan?
After months of talk, the GOP released what is now being called “Trumpcare”. The health care reform bill, known as the “American Health Care Act,” is being presented in response to Obamacare, also known as the “Affordable Care Act”. During his campaign President Trump promised he would repeal Obamacare as one of his first orders of business. Now in two months, it appears he and the Republican party are making good on their promise.
But now that the GOP has presented their plan, people are starting to think Obamacare wasn’t so bad.
In 2009, the Democratic members of Congress passed the Affordable Care Act. It was signed into law by President Obama in 2010. Republicans hated it, although it has done a lot of good. For one, it guaranteed that people with preexisting health conditions could not be rejected by insurers or charged more than others. It also allows children to stay on their parents’ plan until they turn 26. As a result, more than twenty million uninsured people now receive health insurance coverage. Access to primary care, specialty care, medicines, surgeries, and treatment for chronic conditions has risen. It’s projected that Obamacare saves tens of thousands of lives every year. Obamacare also expanded Medicaid and helped people living near the poverty line obtain health coverage.
But for all the good Obamacare has done, it certainly has its problems. For instance, high deductibles for its Bronze plan users make up about 20 percent of its customers. Notwithstanding, people are realizing all the benefits they will miss now that the Republican-backed Trumpcare has been released.
How Obamacare was Funded
The Affordable Care Act is funded by single taxpayers with incomes above $200,000 and couples making more than $250,000 annually. They pay an additional 0.9% Medicare payroll tax. There’s another 3.8% tax that applies to investment income properties which also helps fund Obamacare. The two taxes have been in effect since 2013.
Major Modifications for Trumpcare to Benefit the Wealthy
Under the proposed Trumpcare bill, people earning more than $1 million per year are projected to save approximately $165 billion in taxes over 10 years. The legislation is looking to eliminate two surcharges on the rich that helps pay for Obamacare, but the taxes would end after this year.
It’s not just the millionaires that benefit from Trumpcare. People who earn between $500,000 and $1 million per year also get a tax break of nearly $55 billion over a decade. Further, those with annual incomes of between $200,000 and $500,000 save approximately $53 billion.
Reaction to Trumpcare
The financial implications for the rich of Trumpcare have Democrats and Republicans alike upset. Trumpcare seems to benefit tax filers in the top 1%, or those who earn more than $772,000 a year, who expect to enjoy a $37,000 tax cut in 2022. The top .01% will receive a tax cut of more than $207,000. Clearly the bill will benefit the ultra wealthy.
At the same time, it’s the lower-income Americans that stand to suffer the most. Specifically, those who are insured through Medicaid or subsidized policies will suffer under the legislation. The new health care bill will potentially leave 14 million Americans uninsured than under Obamacare in 2018, rising to 24 million by 2026. In total, approximately 52 million people would be uninsured by 2026 under the GOP plan, compared to 28 million who would lack insurance under the current law.