We’re not going to know how the new repeal and replacement for the Affordable Care Act will impact us personally until it hits, but here are what the proposed changes look like. Thanks to the New York Times, Modern Healthcare, and half a dozen other publications that I receive, here are some highlights, or, depending upon your point of view and financial situation, lowlights from the proposed changes.
Before you read this let me give a quick summary. If you’re wealthy, you’re going to be better off than before. If you own a business, you should be better off financially. If you’re healthy, you’re good for now. If you live in the right state, you might be fine, but, depending on your health situation, you may have to move from state to state to try to find coverage, and please, don’t be poor.
Pre-existing conditions – Under the ACA insurers are required to cover people regardless of any pre-existing conditions and they are not allowed to charge customers based on their health history. The new proposed House bill will allow price differences to be imposed by insurers on a state by state basis. As long as states set up some type of high-risk program, insurers could charge higher prices to those sick customers if they’d experienced a lapse in coverage for more than 63 days.
Dependent coverage until 26 – The new bill keeps this provision.
Taxes – Under the ACA new taxes on medical devices, indoor tanning, prescription drugs and high-income individuals were imposed. All of these taxes would be repealed.
Employer mandate-The ACA requires companies to provide affordable insurance to their employees. This will no longer be a requirement.
Individual mandate- The ACA requires people who can afford health insurance to purchase it. This provision will no longer be a requirement.
Subsidies for out-of-pocket expenses – Under the ACA tax credits currently are provided to help some people make co-payments and pay deductibles. This provision would be repealed in 2020.
Prohibitions on annual and lifetime limits – Under the ACA insurers are barred from setting a limit on how much they have to pay to cover any individual. The House bill allows states to waive the “essential health benefits” rules. Consequently, caps on coverage could become possible for certain types of care.
Restrictions for charging more for older Americans -The ACA prohibits insurance companies from charging older customers more than three times the prices charged to younger ones. The new bill would allow insurers to charge five times more, but states could vote to charge even more.
Premium subsidies – The ACA gives tax credits to middle-income Americans to help offset the costs of the program, but the new bill would use age instead of income and location to calculate how much taxpayers can receive in subsidies. They also put a cap on this for higher earners.
Medicaid Expansion- Right now over 30 states expanded their coverage for Medicaid. The new act would allow those 30 states to continue receiving subsidies until 2020, but states that did not expand Medicaid would not be allowed to do so in the future. The bill also permits states to receive lump-sum block grants and suggests capping federal funding per enrollee, and it gives the states the right to impose work requirements for some Medicaid beneficiaries.
Essential health benefits – Basic benefits including for emergency care, maternity care, and preventive services are currently part of the ACA. The House bill allows states to decide if they want to provide basic benefits or not.
Health savings accounts -Under the ACA, individuals could put up to $3400 and a family $6750 into a tax-free health savings account, but the new bill would allow people to put much more into their HSA’s while also allowing spouses to make additional contributions.
Time to start over. Insurance exists to help people, not to make insurers and health professionals rich. Better off without insurance than to have people playing with our lives this way.