On Monday of last week President Donald Trump made a somewhat profound understatement when he said, “Nobody knew that healthcare could be so complicated. I have to tell you, it's an unbelievably complex subject.”
He and other Republicans have referred to the Affordable Care Act as a disaster. That disaster now has a shot at being replaced as the Republicans in the House finally released their Affordable Care Act replacement — The American Health Care Act 0r AHCA.
If it is replaced and this plan succeeds it will be the first time in history that Congress has done away with a social benefit program.
The bill has two parts and will dismantle most of ObamaCare the mandate that requires all of us to have insurance, subsidies that help people purchase insurance, ObamaCare taxes — except for the controversial Cadillac Tax — and the expansion of Medicaid by capping federal payments.
The AHCA will replace all that with some subsidies to help Americans purchase health insurance. But how that is laid out is fairly controversial.
Two committees — the House Energy and Commerce Committee and the House Ways and Means Committee — will be marking the bills up by the time you read this. Both committees are expected to pass the bills onto the full House relatively intact. A full House vote should happen in the next couple of weeks.
House Ways and Means Committee Chairman Rep. Kevin Brady of Texas thinks the legislation will pass with the support of almost all Republicans in the House. This prediction despite the controversy that arose over a leak of the program and the difficulty some Republicans and most Democrats had finding a copy of the bills.
In fact, last week Sen. Rand Paul dragged a copy machine to the House side of the capitol building demanding to get a copy. At the release of the plan on Monday evening, Paul who opposes the income-based tax credits of the plan tweeted: “Still have not seen an official version of the House Obamacare replacement bill, but from media reports this sure looks like Obamacare Lite!”
Four other key Repulbican senators oppose the plan. They are Ohio Sen. Rob Portman, West Virginia Sen. Shelley Moore Capito, Sen. Cory Gardner of Colorado and Alaska’s Sen. Lisa Murkowski. They’re from states that opted to expand Medicaid when the ACA became law and said they will oppose any plan that leaves millions of Americans uninsured.
In a letter sent to Senate Majority Leader Mitch McConnell, the group said, “We will not support a plan that does not include stability for Medicaid expansion populations or flexibility for states.”
Brady disagrees that this won’t float in the Senate and is completely positive it will pass the House. “We’ve been listening very carefully to our Republican members for months now to make sure we get it right. I am confident we are going to pass this,” Brady said.
House Speaker Paul Ryan agrees with Brady. Contending that ObamaCare is — like the president says — rapidly collapsing, Ryan said this will give all Americans access to quality and affordable health care. “Working together, this unified Republican government will deliver relief and peace of mind to the millions of Americans suffering under ObamaCare. This will proceed through a transparent process of regular order in full view of the public,” he said.
One small problem is the Congressional Budget Office (CBO) hasn’t finished its analysis of the bill so the impacts and costs won’t be available before the bills are passed out of committee. Critics say previous bills similar to these did not pass CBO muster.
Here’s how the plan does the tax credits:
• $2,000 per year for those under 30
• Up to $4,000 per year for those over 60
• The full credit is available to those earning up to $75,000 a year
• The full credit is available to married couples earning up to $150,000 a year
• It keeps the wealthiest among us off of the program
What else does it do?
• Gone is the individual mandate
• Preexisting conditions stays
• Kids on parents’ plan until 26 stays
• Medicaid expansion to help the poor stays in place until 2020 then it’s gone
• The proposal promotes continuous coverage by requiring a 30% higher premium on those letting their policies lapse
Medicaid expansion — as noted — goes away in 2020. But in the meantime, it’s been overhauled in this plan. To appease a significant number of Republican governors and others in their states worried about the loss of millions of dollars to help lower-income people purchase insurance, the plan converts the program from an entitlement to per capita funding.
In other words, if a person in one of the 31 states that opted into ObamaCare is getting subsidies, they will continue to get them but how much Medicaid money a state gets will depend on the number of people covered.
But in 2020 everything changes. Those who are still on the program will continue to be on it and 90% of the cost will be covered. And as long as those people remain eligible the state will get that income to help them. Once they drop off, that’s it. And no new people will be added after that time.
The19 states that did not opt into ObamaCare will split $10 billion over five years. And the states can use that money anyway they want to subsidize insurance or to subsidize hospitals and other health care providers.
On other items, Republicans say the income-based phase-out of the credit funds the plan without taxes on employer-based and provided insurance. That was considered as an option in earlier talks.
Critics — like the Kaiser Family Foundation — point out the plan gives the poorest among us and older people less financial assistance than younger people with higher incomes. Democrats also warn phasing out the Medicaid expansion and the smaller tax credits will mean the 20 million people who gained coverage in recent years will lose it.
Republicans say — yes — the plan will cover fewer people. But they’re not going to force people to buy insurance and say the system is a lot less intrusive into people’s lives.
Assuming it passes the House, things will not go so smoothly in the Senate. Other than Paul and the four senators mentioned earlier, some very conservative Republican critics aren’t so crazy about it either. They call the tax credits the new entitlement and say they have enough votes to kill what some have now dubbed ObamaCare 2.0.
As noted in the bullet points, those with pre-existing conditions will also be protected under this plan and cannot be denied coverage by insurers. While not requiring people to sign up for insurance, the plan does encourage healthy people to participate by charging 30% higher premiums if there is a gap in coverage.
All taxes but the Cadillac Tax are gone but it doesn’t go into effect until 2025. So all it does is keep the new law — if it is passed — affordable to the federal government and add to the deficit. Neither Republicans or Democrats particularly like the tax and look for it to go away sometime before 2025.
White House press secretary Sean Spicer said the president likes the plan and said, “President Trump looks forward to working with both chambers of Congress to repeal and replace ObamaCare.”
Democrats like Reps. Richard Neal of Massachusetts and Frank Pallone of New Jersey — the top Democrats on the two committees marking up the bill — predictably criticized the bills. They said they were drafted in secret and introduced less than two days before the bills are to be marked up. As a whole — their statement said — it “would rip healthcare away from millions of Americans.”
And Senate Minority Leader Charles Schumer has already named the plan after Donald Trump and he hates the plan. “Trumpcare doesn’t replace the Affordable Care Act, it forces millions of Americans to pay more for less care,” Schumer said.
Source links: The Hill, Insurance Business America, The Washington Post