Trump’s Debacle Over Health-Care Opens a New Opportunity

Arcadio Esquivel / Costa Rica

By Florence Oppen


A Stinging Political Defeat for Trump

Trump’s government failed twice – in March in the House of Representatives and in June in the Senate – to pass a health care reform that would “repeal and replace” the Affordable Care Act, also known as Obamacare.[1][2] Trump also failed in his last attempt to “repeal only”. In all cases failed to gain support of the Republican Party, which controls both houses. This failure show two important things: the first is the lack of support for the Trump administration from healthcare corporations such as Blue Cross Blue Shield or United Health, as even the Republican Party did not support the President on this flagship reform.[3] The second is that every day more U.S. workers consider healthcare to be a social right. This political defeat for the government provides a historic opening to fight for single-payer healthcare for all as a step towards socialized medicine, decommodifying access to a basic human need for wellness.
Only 20% of Americans supported the initial failed March bill, the American Health Care Act.[4] The reasons for their opposition are clear: on both occasions the report filed by the Congressional Budget Office (CBO), a federal agency that provides budgetary forecasts to Congress on pieces of legislation, showed that both bills would increase the number of uninsured americans by 23 and 22 million, respectively, by 2025. This lack of support in the public is coupled with a Congressional support due to  growing indications that Trump  has little understanding of  how healthcare works.[5] Now it is clear now that we will not see another attempt to get rid of the ACA.Trump vows  “let the ACA fail” so he can show “the defeat of the Democrats” in practice.
The ACA is not perfect. At multiple levels, it does not and cannot serve the interest of poor and working people.  One of the fundamental flaws of the ACA, analyzed in our previous articles published in this bulletin, is its preservation and expansion of  the idea of a for-profit market for healthcare, enriching  the monopoly of 4 huge insurance corporation’s (United Health Group, Anthem, Aetna and Humana). Under the ACA, health care premiums are set to increase around 12.5% in 2018, on top of the 13% increase we saw in 2017.[6] This is the real source of the frustrations of poor and working class people. To this problem the Republicans did not and will not bring  any solution. They only proposed to make things worse by stripping millions people out of an insurance altogether.

Key features of Trump’s AHCA

Premiums will go up A LOT: For people who have been uninsured for 63 days, there will be a 30% increase in premiums. People are still not allowed to be overtly denied coverage for pre-existing conditions, but for people with them, companies are allowed to charge exorbitant premiums. Preexisting conditions are determined by insurance companies, and according to a study by the largest non-profit healthcare organization in the USA, insurance companies now consider things as common as acne, anorexia, pregnancy, depression, epilepsy, and transsexuality, to be grounds for charging extremely high premiums. How high? Anywhere from $5.6k more per year for a common condition like asthma, to $20k for drug dependence (meaning common conditions like ADD, epilepsy, diabetes, etc), $17k for pregnancy with no complications, $140k for cancer.
Employers don’t have to provide healthcare, and the uninsured are penalized: While the ACA did charge a tax for being uninsured, the cost of being insured was less than the penalty itself. Now, the penalty for trying to gain insurance after being uninsured is %30 of the total premium cost for one year. Thus, after losing healthcare (through something as common as temporary unemployment) it will be even more difficult to purchase it again. Employers with more than 50 employees will no longer have to provide health-care. Currently, most employed Americans receive healthcare through their employer.
Pay the rich, charge the poor: The 3.2% tax on the ultra rich is eliminated. The “Cadillac tax”, an excise tax on insurance companies that charge exorbitant premiums, is eliminated. Working class people, on the other hand, are going to be charged more money for less coverage, since states will be able to file a “waiver” from providing the 10 essential health services put in place by the ACA. Additionally, we are the most likely to be forced to pay into “high risk insurance pools” because of “pre-existing conditions”. Things like asthma, cancer, melanoma, and knee surgery are most common among working class people because of our increased exposure to environmental pollution, workplace hazards, chronic stress, and chronic illnesses from bad quality food and lack of preventative medical care.

Single-Payer: It Is Not That Complicated

From town halls to government offices, excitement at the possibility of single-payer healthcare is palpable. Single-payer is a system in which all people pay a small amount to the government based on income, and all people get full coverage, no matter what. It eliminates the health insurance market, transforming healthcare from a product sold by billionaires like Trump to an essential human right. It is a powerful, simple way of saying that no one should get rich off of the fact that some people are sick, and that no one who is sick should suffer because they don’t have enough money to go to the doctor. Currently, 60% of all US residents support single payer healthcare.
In California, the California Nurses Association (CNA) has been spearheading a coalition named Campaign for a Healthy California to pass SB 562 (Healthy California Act) which would bring single-payer health care to the Golden state.[7] The bill was approved on June 1st by the state Senate. Before it got a chance to get to the Assembly, Democratic Party Senator Rendon used the excuse that the bill was an “empty shell” with no clear funding mechanisms to shelve it and prevent the Assembly from acting on it. Yet we know there were almost no chances for the bill to come into effect, for Governor Brown has repeatedly stated his opposition to single-payer, even though he supported it since before his run for election in 1992.[8]
“Nobody knew health care could be so complicated,” Trump famously said.[9] The ACA showed that it is possible to make it illegal for insurance companies to discriminate against those who have pre-existing conditions. The idea that anyone living on U.S. soil deserves access to health care is now a shared belief among many Americans. In the case of California, it is true that to properly finance single-payer we would need not only to change Prop 13 (regarding the limit to property taxes) and maybe find a way around Prop 98 (which was passed in 1988 in response to Prop 13 which limited property taxes and the state revenue mandates that a minimum of 39% of the state budget is spent in K-12 education), but more important to pass a progressive taxation on corporate profits.[10]
The detractors of SB 562 argued that California cannot afford to provide affordable healthcare for all by making the state the primary insurer and cutting the monopolistic insurance companies out of the equation. As  socialists strongly disagree with this based on several key facts.
First of all let’s understand an indisputable fact: this money is there because it is already being spent by Americans, mostly by workers who are buying their insurance out of pocket. The Healthy California Act would cut the total spending of healthcare by 18% (the actual share of the insurer profiteers), and workers will see their spending on healthcare reduced on average by 9% (which is a de-facto pay increase).[11] Single-payer healthcare is cheaper, a centralized agency for insurance costs less money and resources than the current anarchy of a monopolized market. And yet this question is not just one of “cost,” a merely an economic one, what this campaign captures is a necessary political shift: will the government become responsible for providing healthcare insurance or will it be left to the private sector market? Will the government consider that healthcare is a right and thus cut out of the picture the healthcare profiteers or not? If the answer is yes, there are plenty of untapped resources in the state of California to make this happen.
Now let’s look at the numbers in California. The bill is estimated to cost between $331 billion and $400 billion. $225 billion would come from the already existing funding of Medicare and Medicaid from federal, state and municipal public financing which cover roughly 70% of the total healthcare expenditures.[12] The remaining amount could be covered by taxes on the rich and corporate profits. California is one of the wealthiest states in the world, and the fiscal house of under-taxed oil giant multinationals like Chevron as well as some of the most profitable high-tech and entertainment companies. Apple for example made $45 billion in profits in 2016 alone, ranking no. 3 in the country. Wells Fargo made $21 billion, Alphabet (which is Google’s parent company) $19 billion, Intel $10 billion, Cisco $10 billion, Disney $9 billion, Hewlett-Packard Enterprise $3 billion, McKesson (a giant California based pharmaceutical distributor) $2 billion, and HP $2 billion to name a few. It is also a state that hosts the richest billionaires: Larry Ellison ($54 billion from Oracle), Mark Zuckerberg ($33 billion, Facebook), Larry Page ($29 billion, Google) and Laurene Powell ($19 billion, Apple).[13] And these are just the tip of the iceberg: there are around 130 billionaires in the state paying very low taxes.[14] In fact, these corporations do not even pay the 35% of federal income tax, it is 25% for Apple and 19% for Alphabet, for they declare part of their income as coming from abroad.[15] California’s corporate tax is only 8.84% (it was of 9.3% in 1996), and collects around $11 billion in corporate taxes a year, and represents only 9% of the total budget, that should be changed to cover for a significant part of a universal health-care plan.
Unfortunately, the Healthy California Act does not propose these kinds of corporate and progressive tax measures. Instead it proposes “ (1) a gross receipts tax on all California businesses of 2.3 percent, but with the first $2 million in business receipts exempted from the tax. This means that small businesses will pay no gross receipts taxes; (2) a 2.3 percent sales tax increase. This would exempt spending on housing, utilities and food.”[16] While we strongly agree with the first tax proposal of the Healthy California Campaign (it should even  be higher!), we disagree with the second, namely the regressive sales tax. It is possible to raise the roughly $100 billion needed by taxing corporate profits, big business, oil extraction, and other forms of corporate wealth. Working people have already paid too much in this country. They deserve to see the fruits of their labor provide them with free quality public services like healthcare and education.

Democrats Killed Single Payer in California, Let’s Organize Workers to Get It Nationally!

The betrayal of Sen. Rendon in CA, likely orchestrated with wide support from the rest of the Democratic Party, has thrown the Healthy California coalition into crisis as many are beginning to report.[17] Some unions like NUHW (National Union of Healthcare Workers) are beginning to question whether this was the most expected outcome of a campaign that put forward a worthy and important bill but focused mainly on the traditional lobbying of “progressive” politicians, instead of building power at the base. A  strategy of convincing and begging those in power to listen to demands, even if appealing, was a failing one. It is now the moment to continue and renew the fight for healthcare for all by building power on our side, in our unions, schools, workplaces and universities and revisiting the strategies that historically got the labor and Civil Rights movements key victories in this country: mass demonstrations, popular strikes with community support, building occupations etc. It is also important that the organizing of a grassroots movement is carried in a democratic fashion, whereby all willing partners have a say at the table.
Trump’s defeat in repealing the ACA and the growing discussion and concern around health care among working people presents a new opportunity (You can fool some people sometimes, but you can’t fool all the people all the time!). Fortunately, more and more people have seen the light with the movement for single-payer healthcare exploding across the country, and the possibility of it being shouted from town halls to government offices. Some socialist organizations like the Democratic Socialists of America, the International Socialist Organization as well as La Voz are supportive of a national campaign for single-payer. This is a very positive step forward;socialists need to get involved in national campaigns that speak to the needs of working people and show in practice that “collective action gets the goods”. This  needs to be a campaign that includes all the forces of the Left and the grassroots organizations of the working class to go beyond the ACA and show that the future of this country does not lie with the Republican or Democratic Parties, but in the hands of the people.
Recent polls show that more U.S. workers not only support a federal government plan to provide healthcare but 33% of those polled think that there should be a “single national government program”, and not a mix of public and private ones.[18] A  demand for free and fully socialized medicine may not be such an impossible  task  after all, but rather the base minimum the wealthiest country in the world could provide for its people.
[1] “The March bill was called the American Health Care Act and the June bill was called the Better Care …”
[2] The March bill was called the American Health Care Act and the June bill was called the Better Care Reconcilliation Act.
[5] “Trump cited numbers that don’t seem to come from any recent version of the health care debate. He talked about how health insurance ought to cost “$15 a month” — a premium that anyone who has ever purchased coverage, let alone studied the health insurance market, knows is unheard of.”

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