House Republicans Pass Healthcare Measure, Bill Moves to Senate

By:
Chris Gaetano
Published Date:
May 5, 2017
Congress

House Republicans have, after weeks of acrimonious bargaining, passed a bill that would repeal and replace the Affordable Care Act, according to the Washington Post. The 217 to 213 vote was an important, yet incomplete victory, as the measure must now move onto the Senate. 

As can be expected, the bill changes many of the Obama-era health care provisions, according to another Washington Post article. It would end enforcement of the individual mandate, a key component of the Affordable Care Act, as well as the employer mandate to offer coverage. In their place is a requirement of continuous coverage under threat of severe penalty: those who purchase a new plan after a previous coverage lapse can be charged a 30 percent premium surcharge, with individual states having the option to make this penalty even more severe. This is, ostensibly, to incentivize people to stay covered.

While the ACA provided tax credits based on income, age, geography and other factors to buy insurance through insurance marketplaces, the AHCA would provide tax credits based on income and age for people buying any individual health insurance plan sold in their state. The New York Times said that these credits would be $2,000 to $4,000 a year provided the beneficiary is not already covered by programs like Medicare or Medicaid. A family could receive up to $14,000 a year in credits. The value of the credits would go down for those making over $75,000 a year and families making over $150,000. 

The bill also walks back some of the insurance regulations imposed by the Affordable Care Act, according to NPR: states can opt out of the ban on denying coverage or increasing premiums based on preexisting conditions, as well as the essential health benefits requirement and the prohibition on charging elderly patients more than three times what younger patients pay for the same policy. Insurance companies would also be allowed to impose annual and lifetime benefit limits, which they are currently unable to do under the ACA. If states take these waivers, though, they would need to set up another program to cover their sickest residents, such as a high-risk pool. The bill would give states $138 billion over ten years to help establish and maintain such programs. 

There would also be dramatic changes to Medicaid: the bill would change it from an entitlement program to a grant program awarded to individual states based on number of enrollees or, alternately, as a lump sum block grant. Further, it would scale back the ACA's Medicaid expansion, which allowed individual states to expand eligibility to any single non-disabled with incomes slightly above the poverty line, by cutting the federal reimbursement rate for anyone who leaves the program. NPR said that people often cycle in and out of the program, so federal reimbursement would slowly dwindle. 

It would also nearly double the amount that people can contribute to pre-tax health savings accounts: currently individuals can contribute up to $3,400 a year and families up to $6,750. Under the AHCA, this number grows to $6,550 for individuals and $13,100 for families. Speaker of the House Paul Ryan said that HSAs are a key component of the reform. 

While Senate Republicans are also keen to repeal and replace Obamacare, they have said there are major issues with the bill that would need to be addressed, according to CNBC. Much like in the House, moderate Republicans have expressed serious reservations about aspects of the plan, while more hardline conservatives disliked the tax subsidies. Senators intend to take their time with the bill, with some saying they would like to scrap the bill entirely and work on their own version from scratch, according to Bloomberg

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