In 2013, John Burns gave his father-in-law one of his kidneys. Burns, a lawyer at the firm Williams Mullen in Raleigh and now a Democratic Wake County commissioner, was a healthy forty-two-year-old; with Burns’s kidney, his father-in-law could stay off dialysis.
“I was very happy to do it,” Burns told me last week. “My father-in-law’s insurance covered the entire operation. But if there is an impact on your insurability later, there are people who are not in my financial circumstances who would not be able to do that. To me, if we’re setting up a system where someone is discouraged from helping someone else, that’s backwards.”
The system he’s referring to is the American Health Care Act, which narrowly passed the U.S. House of Representatives last weekspecifically, a provision in it known as the MacArthur amendment, which relaxes the Affordable Care Act’s mandate that insurers cover preexisting conditions. After all, before Obamacare went into effect, having one kidney qualified as a preexisting condition that could render you uninsurable. Under the AHCA, it could lead to impossibly expensive premiums.
Burns has good insurance through his employer, he points out, and he hasn’t had any problems. But if he ever wanted to strike out on his ownto, say, start his own firmand he had to purchase insurance on the individual market, his kidney donation could become an issue.
“Why should I be forced into a battle with an insurer because I did something I should have done?” he asks. “It’s just a very perverse incentive.”
A conservative sampling of what insurers consider preexisting conditions ranges from sleep apnea to anxiety to alcohol abuse, along with conditions like AIDS and cancer; according to Time, experts say acne, celiac disease, and migraines may also lead insurance companies to hike premiums.
I have no idea how my own preexisting conditionsanxiety and thyroid disorderswould be viewed by insurers; since I’m insured through the INDY, it’s not something I worry about. Were I to ever again become a full-time freelancer, that would change. I’m certain that my friend Julia, who was born prematurely, weighing less than two pounds and with a heart condition, would be affected if she sought insurance on the individual market, as would her mother, who contracted polio as a child.
And the same goes for Burns’s sister, a thirty-two-year-old mother and minister whose body stopped producing insulin. With insurance, she spends thousands of dollars on insulin. “What’s she going to do when they jack up her rates so that she can’t afford insurance?” Burns asks.
The Republican answer to that question is that it won’t happen. “Under this bill, no matter what, you cannot be denied coverage if you have a preexisting condition,” House Speaker Paul Ryan told ABC’s This Week Sunday. “… You can’t charge people more if they keep continuous coverage.”
Let’s unpack both parts of that statement.
The first is true in the same way that I won’t be denied access to a Lamborghini Aventador: if I can afford it, I can buy it, but I probably can’t afford it.
The second requires more explanation. Under the MacArthur amendment, states can apply for waivers exempting them from the preexisting-conditions mandate and a requirement that insurance policies cover a range of essential health benefits, including mental health care and hospitalization. In states with such a waiver, insurers could, for one year, charge people on the individual market who let their coverage lapse for sixty-three days based on their “health status.”
This is designed to keep people from gaming the system, from waiting until they’re sick to seek insurance. But the practical effect is that insurers can charge morea lot morefor preexisting conditions. According to an analysis from the left-leaning Center for American Progress, individuals with metastatic cancers could pay a premium surcharge of up to 3,500 percent, to more than $142,000; individuals with diabetes, 137 percent; with autism, 135 percent; with asthma, 106 percent; with drug dependence, 502 percent. A pregnancy without complications could result in a 425 percent surcharge.
These sorts of preexisting conditions affect millions of Americans: the Kaiser Family Foundation estimates that 27 percent of adults under sixty-five, including 1.6 million North Carolinians, have conditions that could render them uninsurable. While only about 8 percent of the nonelderly population is insured on the individual market, that’s still eighteen million people. Of them, nearly 2.3 millionincluding eighty-six thousand Tar Heelswho have preexisting conditions buy insurance on the Obamacare marketplace.
According to the , in 2016 an estimated thirty million adults had a lapse in their coverage longer than three months and would have been vulnerable to these surcharges were they on the individual market. With the AHCA, that number’s likely to climb considerably. For starters, the AHCA replaces Obamacare’s income-based subsidies with less-generous tax credits, meaning that many on the individual marketespecially those who are older and poorerwill face higher premiums. If they can’t pay, their insurance will lapse and their preexisting conditions will come into play whenever they try to get insurance again. And if they can’t pay those premiums … well, you see how this becomes a vicious cycle.
The AHCA’s solution is to have states create cost-sharing mechanisms to keep premiums lower, including high-risk pools. The bill passed last week allocates $138 billion over a decade toward that cause. But according to Aviva Aron-Dine, a senior fellow at the Center on Budget and Policy Priorities, that’s $200 billion short of what’s needed, even with people in those pools paying premiums of as much as $10,000 a year.
All of which is to say that, for the sick and the poor, maintaining continuous coverage could become nearly impossible, which means preexisting conditions could once again render them effectively uninsurable.
For the rest of us, too, the MacArthur amendment could have ill effectseven in states that don’t seek waivers. As Matthew Fiedler of the University of Southern California Schaeffer Center for Health Policy & Economics notes, states that obtain waivers for essential health benefits will allow insurers in those states to reimpose lifetime and annual coverage caps, even for people who receive insurance through their employers. But, Fiedler writes, “A single state’s decision to weaken or eliminate its essential health benefit standards could weaken or effectively eliminate the ACA’s guarantee of protection against catastrophic costs for people with coverage through large employer plans in every state.”
Under current regulations, large employerswhich covered 86 percent of private employer plans in 2015are permitted to apply any state’s definition of essential benefits to their plans. Because the ACA requires all states to adhere to the same benefits, this hasn’t been an issue. As soon as the first state receives a waiver, “the consequences of allowing this flexibility could be significant,” Fiedler writes.
Any potential changes to lifetime caps have Jedidiah Gant worried. Not for himselfthough he has Crohn’s disease, a preexisting conditionbut rather for his son, Oliver, who turns eight next month. Oliver was born with a tumor in his abdomen.
“It was a gut punch to find out your child has cancer,” says Gant, a strategist at Myriad Media in Raleigh. “You do what you have to dosave your child’s life.”
In his case, that meant flying to New York for lifesaving surgery. But both the cancer and that surgery left Oliver with lifelong complications: he can’t urinate and needs four catheters a day; he suffered hearing loss from the chemo and requires hearing aids. He’ll need care and medical supplies for the rest of his life.
Gant’s wife works for the state, so they have good insurance, Gant says. Even with that, however, they’re still paying down the debt they incurred. But what happens when Oliver is too old to stay on his parents’ insurance? “He’s gonna have to leave college and get a job to pay for his own insurance,” Gant says. “His life is not going to be making money to pay for awesome shoes. There will be perpetual medical costs he’s going to have in the future.”
And what happens if lifetime caps go back into effect?
“We’re trying to celebrate him being five years off cancer treatment,” Gant says. “We know it’s not the end of the road because of all these other conditions. It’s also extremely scary to know that the future remains unseen.”
This article appeared in print with the headline “I Am a Preexisting Condition.”