Senate’s version of ACA repeal released

Senate Republicans have released a draft of their legislation to replace the Affordable Care Act, which includes reducing subsidies for buying insurance and rolling back the expansion of Medicaid beginning in 2020.

The legislation takes many provisions from the House-passed American Health Care Act (AHCA) under a new name: the Better Care Reconciliation Act (BCRA). Since the AHCA was passed on May 4, Senate Republicans have been working on their version in closed-door meetings without holding committee hearings, a process which has been criticized by Democrats and some within the Republican caucus, who weren’t given the draft bill before it was publicly released. Senate Majority Leader Mitch McConnell, R-Kentucky, however, defends how his party crafted the bill.

“It’s time to act,” he said on the Senate floor after the bill was posted online, “because Obamacare is a direct attack on the middle class and American families deserve better than its failing status quo. They deserve better care. That’s just what we’re going to continue to work to bring them.”

McConnell said the Congressional Budget Office is expected to release its report on the bill early next week. Earlier plans said a vote could be held as soon as June 27, which McConnell called “ample time” to offer amendments and “robust debate” on the legislation.

Here are some highlights from the bill:

  • Individual and employer mandates would be repealed retroactively, erasing tax penalties for those not buying or offering insurance dating back to 2016.
  • States would be allow to waive required health benefits for insurance plans, which include maternity care, hospitalization and emergency care, beginning in 2020.
  • Cost-sharing reduction subsidies for insurers would be funded through 2019, but disappear after 2020.
  • Hospitals in states which chose not to expand Medicaid would receive additional disproportionate share hospital (DSH) payments.
  • Subsidies for buying insurance would be based on income, rather than being mostly age-based like in the AHCA. The benchmark premium for those subsidies would be based on a skimpier median-cost plan with an actuarial value of 58 percent, lower than in the ACA.
  • Subsidies would be available for people with income from 0 to 350 percent of federal poverty line, rather than the ACA’s 100 to 400 percent range.
  • Insurers would be allowed to charge older customers up to five times more than youngest customers. For those aged 60-64 who qualify for subsidies, they could have to pay up to 16.2 percent of their income on an exchange plan.
  • The expansion of Medicaid would be rolled back beginning in 2020, fully phasing out by 2024.
  • Medicaid funding would be changed to per capita allotments to states (tied to overall inflation, not medical inflation) with the option of a pursuing a block grant, similar to the AHCA.
  • $50 billion would be provided for “short-term assistance” over four years meant to stabilize exchanges.
  • Almost all of the ACA’s taxes, including those on medical devices, would be repealed
  • Use of health savings accounts would be expanded, including raising contribution limits to the out-of-pocket maximum in a customer’s health plan.
  • $2 billion for HHS grants would be provided to states to support opioid abuse programs.

The bill doesn’t appear to mention allowing states to waive the ACA’s community rating provision, one of the most controversial portions of the House version. If waived, insurers would be allowed to raise premiums on individual market customers based on their health status if they didn’t maintain continuous coverage, potentially pricing people with pre-existing conditions out of the individual market.