Health Care Legislation Moves to Senate

“There are three phases of this plan,” HHS Secretary Price said. “One is the bill that was introduced [March 7, 2017] in the House of Representatives… Second are all the regulatory modifications and changes that can be put into place… [t]here were 192 specific rules that were put out as they relate to Obamacare, over 5,000 letters of guidance and the like.”

“And we are going to go through every single one of those and make certain that they—if they help patients, then we need to continue them. If they harm patients or—or increase costs, then obviously they need to be addressed,” he said about phase two.

“And then there’s other legislation that will need to be addressed that can’t be done through the reconciliation process,” he said, moving on to phase three. “So, the goal of all of this is patient-centered health care, where patients and families and doctors are making medical decisions and not the federal government.”

Efforts to dismantle the Affordable Care Act (ACA) continue in Washington on several fronts. On March 7, 2017, Health and Human Services Secretary Tom Price, MD, explained the three phases of ACA repeal: repeal legislation; regulatory review; and subsequent legislation that cannot be included in the first repeal effort due to Senate rules on the budget reconciliation process (see box). Action is occurring on all three phases.

Phase One

The American Health Care Act (AHCA), legislation to repeal the ACA, narrowly passed the House last month after the bill was amended to address concerns raised by the first Congressional Budget Office (CBO) score of the bill that estimated AHCA would leave 14 million more people uninsured next year than under President Obama’s health law—and 24 million more in 2026. However, on May 25, the CBO released the updated CBO score for the House-passed version of AHCA. This second estimate was required by Senate rules before the chamber could take up the bill.

The second estimate projects that the bill will save $119 billion over 10 years, $32 billion less than the previous scored version of the bill, and approximately $220 billion less in savings than the initial bill, and was projected to erode coverage by 23 million by 2026.

Here are some highlights from the new CBO score. CBO stressed the uncertainty of its estimates, given that it is hard to know which states would take up the chance to opt out of certain key parts of the ACA. All figures are for the decade spanning 2017 to 2026 unless otherwise specified.
  • 14 million fewer people will be insured one year after passage.

  • 23 million fewer will be insured in 10 years.

  • AHCA would cut spending on Medicaid, the joint federal-state health program for low-income people, by $834 billion. The program would cover 14 million fewer people.

  • Premiums will go up in 2018 and 2019. After that, there will be significant variation depending on whether someone lives in a state that opts out of key ACA insurance rules.

  • One out of 6 Americans will live in an area with an unstable insurance market in 2020 where sick people could have trouble finding coverage.

  • Poor, older Americans would be hit especially hard. The average 64-year-old earning just above the poverty line would have to pay about 9 times more in premiums.

  • In 2026, 51 million people under age 65 would be uninsured—almost twice as many as the 28 million who would have lacked coverage under the ACA.

  • The bill will save $119 billion, which is $32 billion less than a previous version of AHCA.

  • It repeals $664 billion worth of taxes and fees that had financed the ACA.

The path forward for the bill in the Senate is unclear. The next step is for the Senate parliamentarian to determine which provisions of the bill can pass through reconciliation, which is important even if the Senate plans to largely start from scratch.

Phase Two

The second phase began in earnest on May 17, 2017, when the Trump administration and the Centers for Medicare & Medicaid Services (CMS) announced that starting with coverage in 2018, consumers can buy an ACA-approved plan directly from a broker or an insurer’s website instead of having to go through HealthCare.gov. It is unclear how many people could be eligible for this new path, but brokers historically sign up at least 50% of exchange enrollees.

The Obama administration had raised the idea for a direct enrollment in proposed rulemaking, but it was never finalized. Serious concerns had been raised about consumers having to provide personal financial information to third parties, which some critics said creates more opportunities for that information to be vulnerable.

The news came on the heels of an announcement by CMS allowing small businesses to skip the federal marketplace to sign their employees up for Small Business Health Options Program (SHOP) coverage. SHOP had been criticized for underperforming when out of the nearly 30 million small businesses in the country, fewer than 8000—less than 0.1% of small businesses—currently participate.

Phase Three

At the same time the second CBO estimate was being released on May 24, 2017, the House Ways and Means Committee was passing three health care bills that make up a part of Phase Three to repeal the ACA. The bills were written to work in conjunction with the AHCA.

The first bill, approved with no Democratic support, allows veterans to retain eligibility for ACA subsidies should the AHCA become law. Critics blasted the legislation, saying it would not protect veterans with pre-existing medical conditions under AHCA, which allows states to opt out of certain coverage protections.

Another bill would allow tax credits available under the AHCA to be applied to COBRA plans. The panel approved that measure with one Democrat voting with Republicans.

The final bill, approved with no Democratic support, would require individuals to verify their income eligibility and citizenship or legal immigration status with the Social Security Administration before accessing premium tax credits.