How
the Republican bill would change Obamacare, by Tami Lunbi, 5/5/17
Replace Obamacare subsidies with
refundable tax credits based mainly on age
The
GOP's plan would eliminate the Obamacare subsidies, which are refundable tax credits
based on a person's income and cost of coverage in their area. More than eight
in 10 enrollees on the Obamacare exchanges receive this assistance, but
individuals making more than $47,500 and families of four earning more than
$97,200 do not qualify.
Instead,
the Republicans want to issue refundable tax credits to help people afford
coverage on the individual market, but these credits will be based mainly on a
person's age.
The
credits will range from $2,000 for 20-somethings to $4,000 for those in their
early 60s. The credits will also have an income cap. Those making more than
$75,000 would see their tax credits start to phase out, and an enrollee making
more than $215,000 would not be eligible. Families with incomes above $150,000
would see their credits dwindle, while those earning more than $290,000 would
not qualify. The
bill would also kill the additional help that individuals earning less than
roughly $30,000 a year receive to cover their out-of-pocket costs. More than
half of the enrollees on the Obamacare exchanges receive these cost-sharing
subsidies.
Trade the individual and employer
mandates for continuous coverage requirements
The
GOP's bill would get rid of the Obamacare requirement that people have health
coverage or face a tax penalty. It would also eliminate the mandate that
employers with at least 50 employees provide health insurance to their workers.
Under
Obamacare, these companies had to provide affordable insurance to staffers who
work more than 30 hours a week. They would face a penalty if they did not meet
this criteria and their employee sought subsidies on the exchanges.
Instead,
the Republican plan seeks to allow insurers to impose a 30% surcharge on the
premiums of those who let their coverage lapse for at least 63 days. The plan
would enable insurers to levy this surcharge for one year, but it would only
apply to policies bought in the individual or small group markets.
Under
a recent amendment, states that seek waivers could replace this provision with
one that allows insurers to charge consumers who've had a gap in coverage based
on their health status.
Weaken Obamacare's protections for
people with pre-existing conditions
States
could get waivers that would allow carriers to set premiums based on enrollees'
medical backgrounds under several circumstances. Those enrollees would have to
have let their coverage lapse, and the state would have to set up a risk
program -- such as a high-risk pool -- that, in some cases, could provide
help to those being charged higher premiums.
States
could also seek waivers that would allow insurers to sell plans that don't
include all the essential health benefits mandated by the Affordable Care Act.
Under Obamacare, carriers must provide outpatient care, emergency services,
hospitalization, maternity, mental health and substance abuse, prescription
drugs, rehabilitation services, lab work, preventative care and pediatric
services.
Eliminating
these two provisions could lower premiums somewhat and give consumers a wider
choice of plans. But it would also make it harder for people to buy
comprehensive coverage and weaken the protections for those with pre-existing
conditions.
The
bill would provide $138 billion through 2026 to help states and insurers lower
premiums and set up high-risk pools to cover those with pre-existing
conditions.
Revamp Medicaid funding
The
GOP bill would significantly overhaul Medicaid.
It
would send the states a fixed amount of money per Medicaid enrollee, known as a
per-capita cap. States could also opt to receive federal Medicaid funding as a
block grant for the adults and children in their program. Under a block grant,
states would get a fixed amount of federal funding each year, regardless of how
many participants are in the program.
Either
option would limit federal responsibility, shifting that burden to the states.
However, since states don't have the money to make up the difference, they
would likely either reduce eligibility, curtail benefits or cut provider
payments. The block grant would be more restrictive since the funding level
would not adjust for increases in enrollment, which often happens in bad
economic times.
The
legislation would also end the enhanced match rate for Medicaid expansion for
new enrollees starting in 2020. Those already in the program could stay as long
as they remain continuously insured. States that have not already expanded
would not be allowed to do so, starting immediately.
States
could also require able-bodied Medicaid recipients to work, participate in job
training programs or do community service.
The
Congressional Budget Office projects that bill would cut the federal
government's spending on Medicaid by 25% by 2026 as compared to current law.
Related: First 100 Days: What Trump
has done to Obamacare Loosen the age-band so insurers can
charge older folks more. Under
Obamacare, insurers could only charge older enrollees three times more than
younger policy holders. The GOP bill would widen that band to five-to-one,
which would hike premiums for those in their 50s and early 60s, but reduce them
for younger folks. States
would also be allowed to seek waivers to allow insurers to charge older
consumers even more than five times younger ones.
Eliminate Obamacare taxes
The
Republican legislation would eliminate the taxes the law levied on wealthy
Americans, insurers, prescription drug makers, device manufacturers and others.
http://money.cnn.com/2017/05/04/news/economy/obamacare-republican-health-care/index.html
Comments
Higher charges should go to those who have higher claims. Allowing insurance companies to shift cost based on age is a bad deal for the 50% healthy patients.
Norb Leahy, Dunwoody GA Tea Party Leader
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