10 ways the latest version of Trumpcare could impact you, by Keith
Speights, The Motley Fool, 6/27/17
Here's
how the Senate version of Trumpcare might change your healthcare access and
costs.
Trumpcare "version 2.0"
has been released. On Thursday, U.S. Senate Republicans unveiled details of
their bill to replace Obamacare. The draft legislation, referred to as the
"Better Care Reconciliation Act," has many similarities to the American Health Care Act healthcare reform
legislation passed by the U.S. House of
Representatives last month -- but there are also some key differences.
President Trump has already
indicated support for the Senate version. He stated publicly that he urged
senators to use savings that would be created by the House bill to give the
Senate bill more "heart." Here are 10 ways that the latest version of
Trumpcare could impact you if it becomes law.
1. Keeps Obamacare on life support
for now With major health insurers
continuing to withdraw, the Obamacare exchanges for providing individual health
insurance are in danger of unraveling. To keep the individual health insurance
market from falling apart while the new Trumpcare reforms are implemented, the
Senate bill allocates federal funds for cost subsidies to insurers until 2019.
This would likely make it easier for many Americans to find coverage until the
GOP legislation fully takes effect.
2. Eliminates the individual
mandate Obamacare requires Americans to
obtain health insurance or pay a tax penalty if they don't. This individual
mandate would be eliminated by both the Senate version of Trumpcare and the
House version. The intent is basically this: If you don't like your health
insurance, you don't have to keep it.
3. Changes eligibility requirements
for premium tax credits Obamacare allowed subsidies for
Americans who made up to 400% of the poverty level. The Senate bill uses a cap
of 350% for premium tax credits, which means fewer in the middle class will
qualify for assistance. Unlike Obamacare, though, it also allows individuals
below the poverty line to receive financial assistance. That's potentially good
news for some Americans living in states that didn't expand Medicaid with
Obamacare. While the House bill based tax credits only on age, the Senate
version bases the financial assistance on income level.
4. Cuts taxes Obamacare included an assortment of
taxes. Most of them go away with both the Senate and House versions of
Trumpcare, including the medical device tax and prescription drug tax. You
won't have to pay the 3.8% net investment income tax imposed by Obamacare if
you're a married taxpayer filing a separate return making $125,000 or more
annually, if you're married filing a joint return making $250,000 or more
annually, or if you file as an individual and make $200,000 or more annually.
5. Leaves the status quo for
pre-existing conditions Technically, coverage for
pre-existing conditions is an area where the Senate legislation won't impact
Americans. While the House bill allowed states to obtain waivers that could
permit insurers to charge more for individuals with pre-existing conditions,
the Senate bill doesn't mention pre-existing conditions at all.
6. Allows states to get waivers to
change minimum benefit levels Obamacare requires every health insurance
plan to cover "essential health benefits," including mental health
and substance-abuse services, prescription drugs, preventive care, maternity
care, emergency services, and lab services. Like the House bill, the Senate
version of Trumpcare allows states to obtain waivers that would enable them to
set different minimum benefit levels. This could mean that you will be able to
obtain individual health insurance with lower premiums, since insurers could
charge less for plans with fewer benefits if your state receives a waiver.
7. Changes health savings accounts Both
the Senate and House health reform bills promote use of health savings accounts (HSAs). The Senate legislation would increase the amount you can
put into an HSA for individuals from $2,250 to $5,000, and for families from
$4,500 to $10,000. It would also allow both spouses to make catch-up
contributions to the same HSA. In addition, the bill reduces the taxes on HSA
distributions not used for qualified medical expenses from 20% to 10%.
8. Eliminates maximum contribution
limit for flexible spending accounts Under current law, you can only contribute
up to $2,500 of your salary to a flexible spending account (FSA). The Senate
version of Trumpcare eliminates this cap altogether. This means that you could
reduce your personal health expenditures by using an FSA to avoid paying taxes
on healthcare costs.
9. Changes Medicaid significantly If
you're on Medicaid, the Senate bill could impact you in several ways. For one
thing, like the House legislation, it allows states to require able-bodied
individuals to work. The Senate bill also phases out the Obamacare Medicaid
expansion beginning in 2020, which means that some states could have to tighten
their Medicaid eligibility requirements. Over the long run, both Senate and
House bills would change federal reimbursement for Medicaid to a per capita
basis. The Senate version would also peg Medicaid spending growth to the
general consumer price index (CPI) instead of the medical-care CPI beginning in
2025, which would reduce overall funding of Medicaid.
10. Eliminates the employer mandate.
Obamacare required employers with 50 or more full-time employees to provide
health insurance coverage to their employees. While implementation of this
provision was delayed twice, it's still part of Obamacare. Under both the
Senate and House versions of Trumpcare, this employer mandate is repealed. This
could be good news for small business owners concerned about the cost of
providing insurance. On the other hand, it could be bad news for employees of
small businesses who hoped to obtain coverage through their employers.
https://www.usatoday.com/story/money/personalfinance/2017/06/24/10-ways-the-latest-version-of-trumpcare-could-impact-you/103130806/
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