Senate Republicans on Thursday unveiled a new version of their bill to repeal and replace the Affordable Care Act, which makes several key changes to their original plan.
The new bill has some significant differences from the one passed by the House in May, including deeper cuts to Medicaid, a program that insures one in five Americans.
How the Senate bill alters major parts of Obamacare
REPEAL | CHANGE | KEEP |
|---|---|---|
Individual mandate | Medicaid expansion | Dependent coverage until 26 |
Employer mandate | Taxes created under Obamacare | |
Subsidies for out-of-pocket costs | Tax credits for premiums | |
Essential health benefits | ||
Prohibitions on annual and lifetime limits | ||
Pre-existing conditions policy | ||
Restrictions on charging more for older Americans | ||
Health savings account |
Medicaid expansion
CHANGE
OBAMACARE Changed the program's eligibility requirements to allow more people to enroll if a state chose to expand the program. The federal government pays at least 90 percent of the costs for newly eligible beneficiaries.
SENATE BILL Allows the 31 states that expanded Medicaid to continue getting federal funding through 2023, with reduced funding starting in 2021. The bill sharply curtails federal support for Medicaid expansion in 2024, likely causing many states to end the expansion.
Separate from the expansion, the bill caps future federal funding per enrollee, based on how much each state has spent historically. States also have the option to receive a lump-sum block grant for some beneficiaries. If a public health emergency was declared, Medicaid spending in the affected part of the state would not count toward the spending limits.
The Congressional Budget Office estimated that the previous version of the Senate bill would have caused overall federal Medicaid spending to fall by more than a third after 20 years. The revisions to the bill would likely lessen those cuts slightly.
Taxes created under the Affordable Care Act
CHANGE
OBAMACARE Imposed new taxes to help pay for expanding coverage to more people. They include taxes on investment income, wages above $200,000, medical devices, prescription drugs and indoor tanning.
SENATE BILL Permanently eliminates many of the taxes on medical industries, but two taxes on the wealthy — a tax on investment income and a payroll tax for high-income households — would remain. The bill would also keep a cap on the tax deductibility of health insurance executive salaries, which would have been eliminated under earlier drafts of the bill. A tax on high-cost employer health plans, which was established under Obamacare but has yet to kick in, would be imposed beginning in 2026.
Subsidies for out-of-pocket costs
REPEAL
OBAMACARE Provides subsidies to help people with lower incomes pay for out-of-pocket costs like deductibles and co-payments.
SENATE BILL Preserves the subsidies through 2019, then eliminates them altogether. This means many low-income people would face substantially higher deductibles. The bill does provide nearly $200 billion to states over a decade to stabilize their markets as they wish; some states might use the money to provide their own cost-sharing reductions.
Tax credits for premiums
CHANGE
OBAMACARE Gives tax credits to middle-income Americans to offset the cost of premiums, based on their income and the cost of insurance in their area.
SENATE BILL Changes the formula for subsidies to make them less generous, and lowers the threshold for people who can receive financial assistance from 400 percent to 350 percent of the federal poverty level, or about $42,000 for a single person. The bill also expands the subsidies to Americans living below the poverty line, who were ineligible under Obamacare.
Essential health benefits
CHANGE
OBAMACARE Requires all insurers to offer 10 categories of essential health benefits, like maternity treatment and hospital care.
SENATE BILL Would allow insurers to offer health plans that don't adhere to the benefit standards, as long as they offer at least one plan that follows all the rules. That means that only a fraction of plans may cover benefits like maternity treatment, prescription drugs, or addiction treatment. The bill would also allow states to apply to waive the standards altogether.
Prohibitions on annual
and lifetime limits
CHANGE
OBAMACARE Bars insurers from setting a limit on how much they have to pay to cover someone.
SENATE BILL Would allow insurers to offer health plans that limit coverage. Also gives states the option to waive the rule for all plans.
Pre-existing conditions
CHANGE
OBAMACARE Requires insurers to cover people regardless of pre-existing medical conditions and bars them from setting prices based on a person's health history.
SENATE BILL Every carrier would have to offer one plan that is open to all customers at the same price, and a $70 billion fund would help the company cover people with higher medical costs. But other plans that could charge higher prices to customers with a history of illness, exclude coverage for their health condition, or deny them coverage altogether. Insurance for people in the more inclusive market is expected to rise sharply under this system, according to actuaries and the insurance industry.
Restrictions on charging more for older Americans
CHANGE
OBAMACARE Bans insurers that sell policies directly to individuals from charging their oldest customers more than three times what they charge their youngest ones.
SENATE BILL Allows insurers to charge older customers five times as much as younger ones. States could waive this rule, and allow insurers to charge even higher prices to older customers.
Individual mandate
REPEAL
OBAMACARE Requires all Americans to buy health insurance or pay a tax penalty, with exceptions for people who have experienced hardships.
SENATE BILL Eliminates the penalties. Starting in 2019, people who have gone without insurance for 63 days or more would be required to wait at least six months before they could sign up for coverage again.
Employer mandate
REPEAL
OBAMACARE Requires larger companies to provide affordable insurance to their employees, or face financial penalties.
SENATE BILL Eliminates the penalties.
Health savings account
CHANGE
OBAMACARE In 2017, allows an individual to put $3,400 and a family to put $6,750 into a tax-free health savings account.
SENATE BILL Allows people to put more money into their health savings accounts, up to the maximum allowed for out-of-pocket costs, and lets spouses make additional contributions.
An amendment to the bill also allows people to use money in their health savings account to pay health insurance premiums, not just the direct cost of medical care. This change allows the premiums to become tax deductible, and could benefit people with higher incomes who are not eligible for premium tax credits.
Dependent coverage until 26
KEEP
OBAMACARE Allows children to stay on their parents' insurance policies until age 26.
SENATE BILL Keeps this intact.
This appeared in The New York Times on July 13, 2017
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July 14, 2017
Addendum. Now that you have seen some of the damage that Trumpcare will do to you and your friends and family, fight back. Save Medicaid. Save the ACA. Tell your Senators to do this and reject Trumpcare! (202) 224–3121.
