Following the Trail of the Affordable Care Act Debate: Part 11

By Zach Cahill and David White

In our last installment, we tried to ground the conversation by laying out how Republican health care ideas impact you. You can review Part 10 of our series here.  Simultaneously, in the last Affordable Care Act (ACA) repeal update in Kidney News, we reviewed the Three Phases of the repeal effort as outlined by Health and Human Services (HHS) Secretary Tom Price:

1)    Direct repeal of the ACA  
2)    Review of 192 ACA-specific HHS rules
3)    Later, subsequent legislation as required

This week we catch up again on points 1 and 2 above. 

1.    Direct ACA Repeal

As you may recall, the American Health Care Act (AHCA), has been sent to the Senate for review. Republican Senators have been meeting in closed-door sessions over the past few weeks trying to piece together a bill that can garner fifty votes.

There are many issues that do not yet have consensus solutions and the battle lines are similar to what we observed in the House. However, Senate leadership began laying out policy options this week. Here are four of the principle stumbling blocks:

  • Medicaid. Some Senators seem to be leaning in a more moderate direction on reforming Medicaid. To be sure, the end result is still ending Medicaid expansion and the additional funds provided to increase coverage. The difference is, the Senate bill may include a ‘longer runway’ for ending expansion than the two years outlined in the House bill. In fact, key advocates for protecting Medicaid, Bill Cassidy (R-LA) and Rob Portman (R-OH), expressed more optimism toward the end of the week that a deal could be made. 
  • Waivers. You may remember the last minute addition of state waivers from certain ACA regulations, in particular community ratings and preexisting conditions. According to reporting this week, the Senate will not allow waivers impacting preexisting conditions or community ratings in their bill. However, the bill may include waivers from other regulations such as essential health benefits and restrictions on the ratio of younger and older people’s premiums.
  • Tax Credits. The senate is said to be considering a tax credit structure very different from the House. The AHCA that passed through the House included tax credits based on age, not income. More generous credits are being considered by the Senate based on age and income. Senator John Thune (R-SD) broached this idea earlier this spring, proposing a measure that would means test tax credits and cap them at a lower income level. 
  • Insurance market stabilization. The individual insurance market continues to be in flux, with more and more counties abandoned by insurers. The amount of money provided to stabilize the markets and how it will be distributed is critical. Of particular concern is how geography will factor into premium support. States such as Alaska have some of the highest health care costs in the nation, largely due to difficulties in accessing care. The AHCA does not consider geography in providing individual premium support, negatively impacting rural areas. 
  • A key talking point for many Republican legislators is repealing all of the ACA’s taxes, yet it appears that Senate leadership is open to leaving some taxes in place to pay for the increased spending needed to shore up the individual marketplaces and provide more generous tax credits. What taxes remain and the timeline for phasing them out could be a sticking point for conservative Senators. 

Senate leadership has expressed an urgent desire to get something done on healthcare before the Fourth of July recess. According to Senate rules, the body cannot vote on their healthcare bill until it has been scored by the Congressional Budget Office (CBO). To make their artificial deadline of the July Fourth recess, the senate must deliver a bill to the CBO at least two weeks prior. That means we could see a bill soon and have a discussion on the actual impact of the legislation.

2.    ACA-Specific HHS Rules

In the Kidney News article, we reviewed some of the regulatory steps to date including allowing brokers and insurers to bypass HealthCare.gov, and allowing small businesses to skip the federal marketplace when signing up employees for the Small Business Health Options Program (SHOP).

Following the Market Stabilization Final Rule on April 18, this week the Centers for Medicare & Medicaid Services (CMS) issued a Request for Information (RFI) seeking recommendations and input from the public on how “to create a more flexible, streamlined approach to the regulatory structure of the individual and small group markets.”

The announcement focused on a recent report issued by HHS which states “that the average premium in the 39 states using HealthCare.gov in 2017 increased from $232 in 2013 to $476 in 2017, which is a 105 percent increase.  Consumers are also dealing with fewer plans to choose from and a continuous stream of issuers exiting the Exchanges.”  We can expect this effort to be used as the basis for further “erosion” of ACA regulations.

We will continue reporting as new developments arise.

Following the Trail of the Affordable Care Act Debate: Part 1Part 2Part 3Part 4Part 5Part 6Part 7Part 8Part 9, Part 10

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In our last installment, we tried to ground the conversation by laying out how Republican health care ideas impact you. You can review Part 10 of our series here.  Simultaneously, in the last Affordable Care Act (ACA) repeal update in Kidney News, we reviewed the Three Phases of the repeal effort as outlined by Health and Human Services (HHS) Secretary Tom Price:

1)    Direct repeal of the ACA  
2)    Review of 192 ACA-specific HHS rules
3)    Later, subsequent legislation as required

This week we catch up again on points 1 and 2 above. 

1.    Direct ACA Repeal

As you may recall, the American Health Care Act (AHCA), has been sent to the Senate for review. Republican Senators have been meeting in closed-door sessions over the past few weeks trying to piece together a bill that can garner fifty votes.

There are many issues that do not yet have consensus solutions and the battle lines are similar to what we observed in the House. However, Senate leadership began laying out policy options this week. Here are four of the principle stumbling blocks:

  • Medicaid. Some Senators seem to be leaning in a more moderate direction on reforming Medicaid. To be sure, the end result is still ending Medicaid expansion and the additional funds provided to increase coverage. The difference is, the Senate bill may include a ‘longer runway’ for ending expansion than the two years outlined in the House bill. In fact, key advocates for protecting Medicaid, Bill Cassidy (R-LA) and Rob Portman (R-OH), expressed more optimism toward the end of the week that a deal could be made. 
  • Waivers. You may remember the last minute addition of state waivers from certain ACA regulations, in particular community ratings and preexisting conditions. According to reporting this week, the Senate will not allow waivers impacting preexisting conditions or community ratings in their bill. However, the bill may include waivers from other regulations such as essential health benefits and restrictions on the ratio of younger and older people’s premiums.
  • Tax Credits. The senate is said to be considering a tax credit structure very different from the House. The AHCA that passed through the House included tax credits based on age, not income. More generous credits are being considered by the Senate based on age and income. Senator John Thune (R-SD) broached this idea earlier this spring, proposing a measure that would means test tax credits and cap them at a lower income level. 
  • Insurance market stabilization. The individual insurance market continues to be in flux, with more and more counties abandoned by insurers. The amount of money provided to stabilize the markets and how it will be distributed is critical. Of particular concern is how geography will factor into premium support. States such as Alaska have some of the highest health care costs in the nation, largely due to difficulties in accessing care. The AHCA does not consider geography in providing individual premium support, negatively impacting rural areas. 
  • A key talking point for many Republican legislators is repealing all of the ACA’s taxes, yet it appears that Senate leadership is open to leaving some taxes in place to pay for the increased spending needed to shore up the individual marketplaces and provide more generous tax credits. What taxes remain and the timeline for phasing them out could be a sticking point for conservative Senators. 

Senate leadership has expressed an urgent desire to get something done on healthcare before the Fourth of July recess. According to Senate rules, the body cannot vote on their healthcare bill until it has been scored by the Congressional Budget Office (CBO). To make their artificial deadline of the July Fourth recess, the senate must deliver a bill to the CBO at least two weeks prior. That means we could see a bill soon and have a discussion on the actual impact of the legislation.

2.    ACA-Specific HHS Rules

In the Kidney News article, we reviewed some of the regulatory steps to date including allowing brokers and insurers to bypass HealthCare.gov, and allowing small businesses to skip the federal marketplace when signing up employees for the Small Business Health Options Program (SHOP).

Following the Market Stabilization Final Rule on April 18, this week the Centers for Medicare & Medicaid Services (CMS) issued a Request for Information (RFI) seeking recommendations and input from the public on how “to create a more flexible, streamlined approach to the regulatory structure of the individual and small group markets.”

The announcement focused on a recent report issued by HHS which states “that the average premium in the 39 states using HealthCare.gov in 2017 increased from $232 in 2013 to $476 in 2017, which is a 105 percent increase.  Consumers are also dealing with fewer plans to choose from and a continuous stream of issuers exiting the Exchanges.”  We can expect this effort to be used as the basis for further “erosion” of ACA regulations.

We will continue reporting as new developments arise.

Following the Trail of the Affordable Care Act Debate: Part 1Part 2Part 3Part 4Part 5Part 6Part 7Part 8Part 9, Part 10

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