This is an ongoing story and by the time this is published things may have changed and changed dramatically. Much has been published about the Senate’s version of the repeal and replacement of the Affordable Care Act and you can see most of those details in about any news sources you use or select. What we do know at this point is without enough votes to pass it, Senate Majority Leader Mitch McConnell will delay the vote until after the July 4th recess.
Our focus in this story will be insurance and how the plan affects this industry.
To begin, normally Congress goes into recess for the full month of August. Stunned by a lack of progress on healthcare reform, tax reform and other Republican goals, McConnell is being pressured by some Republicans to cut the recess short or eliminate it completely because the fiscal year ends September 30th and these things need to be done by then.
The Senate’s new ObamaCare repeal and replacement plan is being bashed by critics on the other side of the political aisle and it’s not all that popular with the public either and McConnell is dancing on the heads of several pins trying to work the plan around to get the support of his colleagues.
And while the Senate hashes things out, the Trump administration has made the June subsidy payments to insurers to help reimburse them for the cost of discounts for low-income insureds. What the administration won’t do — and it is what has caused insurers and insurance commissioners much consternation — is say whether they’ll make another payment in July and in the future.
What is good news — if it eventually passes — is a Senate bill that adds $50 billion over the next four years to stabilize the ObamaCare exchanges. Republicans appear to agree that the uncertainty in these exchanges is causing them to collapse and they need to be stabilized before the law is eventually repealed or repaired.
The bill says the dollars are “to fund arrangements with health insurance issuers to address coverage and access disruption and respond to urgent healthcare needs within states.”
The Senate plan does away with the individual mandate forcing people to purchase insurance and it also does away with the unpopular — at least with Republicans, some insurers and some businesses and medical providers — ObamaCare taxes.
Among them is the 3.8% investment tax, the 0.9% payroll tax, a health insurer tax and a medical expense deduction and prescription drug tax.
• The health insurance tax is $130 billion over 10 years and is directly levied on insurers. That money is then divided among insurers based on the premiums they write each year.
• The excise tax on comprehensive health insurance plans worth $32 billion over 10 years.
• Also gone is the 40% excise tax known as the Cadillac Tax.
Most insurance commissioners are not pleased with the Senate plan. Washington’s Insurance Commissioner Mike Kreidler — the longest serving commissioner in the nation — was highly critical. He said the bill — as crafted — will de-stabilize the health insurance market and cause those who are sick and poor to pay more for less coverage.
“By removing the individual mandate, you guarantee that fewer healthy people will get coverage. If only people who need coverage buy it, the costs will rise for everyone. By removing the funding for cost-sharing subsidies, people will face unaffordable deductibles and copays,” Kreidler said.
He proposes improving the Affordable Care Act rather than repeal and replace. “As I’ve said many times before, we can make meaningful improvements to the Affordable Care Act that will help people in real ways using sound insurance principles, including tackling rising out-of-pocket costs for medical services and the surging prices of prescription drugs,” Kreidler said.
In California Commissioner Dave Jones was equally critical. “The Senate Republicans' proposal to repeal the ACA has most of the same devastating consequences for Americans' health care as the House bill, including provisions that would permit the elimination of coverage for essential health benefits and the caps on out-of-pocket costs that help prevent medical bankruptcy,” Jones said.
He — like Kreidler — was critical of drafting the plan in secret.
“Starting in 2020, the Senate bill would take away premium subsidies for middle-income families whose premiums would then become unaffordable. The Cost-Sharing Reductions, which help low-income Americans reduce their deductibles and copayments, are also eliminated by the Senate bill. The Senate bill would defund Planned Parenthood, which would reduce access to family planning, cancer screenings and other reproductive health care services and increase the number of unintended pregnancies and abortions. Like the House bill, the Senate proposal cruelly strips funding away from health care coverage in order to fund tax cuts for the wealthy,” Jones said.
Source links: The Hill — link 1, link 2, link 3, link 4, MSN