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2017 Federal Healthcare Reform Legislation

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Jul 14, 2017

Background 

In 2017, Congress has been debating legislation to repeal and replace the Affordable Care Act (ACA). As of July 21, at least three proposals are pending before Congress: 

  • The House approved H.R.1628, the American Health Care Act, on May 4 
  • The Senate introduced the Better Care Reconciliation Act on June 27 as an amendment to H.R.1628. It released a revised discussion draft on July 13
  • A measure to repeal the ACA and replace it on a future date (bill language to be released)

A vote on the BCRA and/or the separate measure to repeal the ACA may occur the week of July 24.  

The BCRA's Key Changes from the Affordable Care Act

The Senate Budget Committee has section by section summaries of the July 13 draft on its website. This summary is adapted from information from the Colorado Health Institute and Kaiser Family Foundation

Coverage and Insurance

  • Individual Mandate- replaced by six month waiting period if coverage has lapsed for more than 63 days
  • Essential Health Benefits (EHB)- States can waive essential health benefits and annual & lifetime limits
  • Age-based Rating- increases from a 3:1 ratio to a 5:1 ratio
  • Stability and Innovation Fund- $50 billion for reinsurance from 2018-2021. $62 billion for states to use for state reinsurance, high risk pools, cost-sharing subsidies, and provider payments
  • Reproductive Health- bans funding for Planned Parenthood in 2018 and forbids tax credits for plans with abortion benefits
  • Medical Loss Ratio- Sunsets in 2019 but requires state to establish MLR

Tax Credits and Cost Sharing

  • Credits based on age, income, and region up to 350 percent of the Federal Poverty Level (FPL):
    • the contribution amount is reduced for younger individuals and increased for older individuals;
    • unavailable for individuals offered any employer sponsored plan
  • Cost sharing subsidies- phased out for deductibles, copays, and out of pocket costs of households between 100 and 250 FPL with silver (baseline) plans
  • Health Savings Accounts- doubles & indexes tax free cap- $6,550 individual/$13,100 family 

Employers

  • Mandate for Employers with 50+ employees- Penalty for failing to cover employees is repealed
  • Small Employer Tax Credits- repealed 
  • Association Health Plan Option- for small employers to establish plans without rating & EHB 

Medicaid

  • In 2020, changes funding to per capita allotment, per enrollee amount, or block grant option for states
  • Rolls back federal funding by 2021 for states that expanded Medicaid up to 139 FPL
  • Phases back to 50 percent federal match by 2024 for Medicaid expansion states (currently 90 percent)
  • Allows states to establish work requirements for eligibility 
  • Alows for additional funding for a public health emergency

Health Insurance Marketplaces

  • Subsidies no longer available exclusively in marketplaces

Public Health

  • Repeals the Prevention and Public Health Fund

Substance Abuse

  • Provides $45 billion, which includes funding to address the opioid crisis

Taxes

  • Repeals or delays many ACA taxes on insurers and high-income earners
  • Retains the capital gains tax and Medicare tax 

Impacts of Senate Healthcare Bills

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