Having been involved in Virginia politics for decades one thing that has always been striking is how rural areas of the state - especially Southwest Virginia - regularly votes against their own economic interests. Appeals to Christian extremism and racism time and time again cause the rural areas to support Republicans who are great at promoting dog whistle racism and swearing fealty to the Christofascists at The Family Foundation but who do nothing to help the failing economy in these areas. Making matters worse, the downward spiral in reactionary social norms make the areas less and less attractive for modern, progressive businesses to consider locating to the regions. Now, with Republicans set to either repeal the Affordable Health Care Act or sabotage it further, rural America is on the verge of reaping what it has sown. A piece at Vox looks at Tennessee as a case study of what may be coming to these Trump/GOP supporting areas of the country. It isn't pretty and it is self-inflicted. Here are excerpts:
Tennessee is a preview of what an Obamacare collapse could look under President Trump, where the law technically remains standing but people don’t have access to the programs.
The areas most at risk for this type of collapse are those that voted for Trump: places that are lower-income and rural, which aren’t attractive markets to health insurance companies.
These are places that have struggled to attract robust insurance competition both before and after the health care law’s implementation. “In general, rural areas have always been the places where it’s hard to attract a competitive insurance market,” says Aditi Sen, an assistant professor at the Johns Hopkins Bloomberg School of Public Health who has studied the health law marketplaces. “The incentives to enter just aren’t that strong.”
The Obama administration worked hard to recruit health insurers to sell to those areas. The Trump administration, however, seems to want to stand aside and let Obamacare run on autopilot, so it can explode or survive on its own.
In eastern Tennessee, that could have the practical effect of leaving 40,000 current Obamacare enrollees without coverage.
The stretch of eastern Tennessee where no insurers want to sell coverage includes 6,700 square miles of rolling Appalachian hills and rural roadside towns. It has 16 counties and 1.1 million residents.
Rural areas have long struggled to attract robust health insurance markets. The scarcity of doctors and hospitals makes it hard to build a network. Smaller populations mean there are fewer customers for insurers to sell to than they might find in more urban places.
The whole theory of Obamacare relied on both healthy and sick people signing up for marketplace coverage. The healthy people are crucial to balance out the bills of the sicker enrollees.
The Tennessee marketplace ran into trouble because it gave healthy consumers lots of ways to avoid joining the marketplace — a perfect storm of state and federal policy decisions that undermined the business case for insurers to sell Obamacare policies in the region. . . . It’s a self-inflicted wound.”
Tennessee layered on other policies that made it easier for healthy people to opt out of Obamacare. It appears to be the only state in the country that still allows some insurers to reject or charger higher prices to sick customers. This practice, called underwriting, was generally banned by the Affordable Care Act. A loophole in Tennessee law allows membership-only Farm Bureau plans to continue offering these products.
Georgetown University’s Sabrina Corlette has researched the Farm Bureau plans and estimates about 55,000 Tennesseans are currently purchasing non-ACA-compliant plans through the insurer.
The Farm Bureau plans, the weak individual mandate, the “if you like your plan you can keep it” promise — none of these policies on their own could take down the Affordable Care Act marketplace. But taken together, over the course of three years, they made it significantly easier for healthy people to decide not to enroll in the marketplaces. More than anyone, that hurts sick people.
Congressional Republicans led by Sen. Marco Rubio (R-FL) dubbed it the “Obamacare slush fund,” and in 2014 they inserted a provision into the 2015 federal budget requiring this program to be revenue-neutral.
Because health insurers experienced significantly more losses than payments, the program was only able to pay out 12.6 percent of the bills it owed. Small insurers like Community Health Alliance, a nonprofit planned that launched with a loan from the federal government, couldn’t survive that hit.
“They sort of knocked the breath out of us by taking away the risk corridor,” says Jerry Burgess, who served as chief executive of that plan. Community Health Alliance quit the marketplaces and went out of business in 2015 after the federal government did not pay millions in risk corridor payments that the insurer had expected.
The future of Obamacare under the Trump administration is less certain. Some places, like Florida and California, will be fine. They have big populations and urban markets that are attractive to health insurers.
Other places like Tennessee, more rural and low-income, may struggle. President Trump has given little reassurance to health plans that might be on the fence about entering Tennessee or other markets. His administration has waffled on whether it will continue funding key Obamacare payments. He has said he expects the marketplaces to “explode” on their own.
That's right. Republicans have worked to sabotage the law and withheld needed funding only to then claim the program is failing. For rural hospitals, large numbers of uninsured individuals is financially catastrophic. Required to stabilize people, they must treat them without payment. In turn, they charge more for those who do have coverage and drive costs up further and make insurers more likely to want to leave the local market. The death spiral only accelerates until hospitals go bankrupt and close, taking with them some of the best jobs in the area and depriving residents of ready access to hospital facilities. It's as if rural areas have opted for a slow form of suicide.