The Republican healthcare bill still has a massive problem

Republicans have relied heavily on a key new provision of their healthcare overhaul to sell the bill, but it has a potential problem: They may have not allocated enough money to it.

The GOP has touted high-risk pools as a way to section off people with preexisting conditions from the rest of the market, lowering costs for healthy people.

Such pools are, in theory, supposed to be subsidized by states and the federal government in order to keep costs down for the sick people in them.

Republicans have used that idea to combat criticism of another AHCA amendment from Rep. Tom MacArthur, which would allow states to apply for waivers to repeal parts of Obamacare’s protections if they can prove it would lower costs. Centrist GOP members have expressed concerns about McArthur’s offering, however, because many health-policy analysts say it could undermine protections for people with preexisting conditions.

House Speaker Paul Ryan, President Donald Trump, and White House press secretary Sean Spicer have all cited the high-risk pools as a way to ensure protections for Americans with preexisting conditions in recent days.

But the problem, according to analysts and experts, is that the AHCA doesn’t provide enough money to run a functional high-risk pool.

The original AHCA set aside $US130 billion over 10 years for a state stability fund. That fund wasn’t explicitly earmarked for high-risk pools, but they were among the functions for which the states could use the funding. Also, a new amendment from Rep. Fred Upton would add another $US8 billion to this funding over five years.

Ryan and others have cited state iterations of high-risk pools as a model for the AHCA. According to the Kaiser Family Foundation, a nonpartisan health policy think tank, however, these high-risk pools were woefully underfunded, prohibitively expensive, and few people signed up for them.

Larry Levitt, a senior vice president at Kaiser, said based on old experiences and the number of people with preexisting conditions, high-risk pools need a lot of money put toward them to be effective.

“Even under pretty conservative estimates, a minimally adequate high-risk pool could cost $US25 billion per year nationwide,” Levitt tweeted Wednesday.

Even an estimated from conservative analysts James C. Capretta and Tom Miller said that in order to operate functional high-risk pools in all 50 states, the federal government would need to provide $US15 billion to $US20 billion annually, leaving the AHCA short even with the proposed money from Upton’s amendment.

A separate analysis from Emily Gee and Topher Spiro at the liberal Center for American Progress found that high-risk pools would need $US327 billion over 10 years, leaving the AHCA well short under the current plan.

NOW WATCH: Yale history professor: Here’s why it’s useful to compare Trump’s actions to Hitler’s

NOW WATCH: Briefing videos

Business Insider Emails & Alerts

Site highlights each day to your inbox.

Follow Business Insider Australia on Facebook, Twitter, LinkedIn, and Instagram.