House approves bill to replace key provisions of the Affordable Care Act; All eyes turn to the Senate

The House of Representatives on May 4, 2017, narrowly voted 217-213 to pass the American Health Care Act (AHCA, H.R. 1628). No Democrat voted in favor of the bill and 20 Republicans voted against the bill. As many recall, the House on March 24, 2017, cancelled a planned vote on the AHCA due to a lack of support in the Republican conference.

In the ensuing weeks, three amendments to the AHCA were drafted by House members in an effort to win additional votes for the underlying bill. This ultimately paved the way toward passage in the House today on a slim majority vote. Following the vote, the House went into recess until May 16, 2017.

The AHCA now goes to the Senate for its consideration and likely modification in the coming weeks. Based on the next steps in the process, it may take well into the summer months before a final piece of legislation could be signed into law by President Trump.

The House bill seeks to repeal key provisions of the Affordable Care Act (ACA) and enact alternative health care policies that in general would:

  • Redesign advanceable, refundable tax credits for individuals who do not have access to employer-sponsored coverage
  • Restructure and cap federal Medicaid financing to the states
  • Repeal most taxes and fees enacted under the ACA; and
  • Provide $138 billion over 10 years in federal funding for state programs intended to help stabilize and reduce health insurance premiums in the non-group market.

Next week, Deloitte will produce a detailed summary of the AHCA as amended and passed by the House.

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Republican health care bill would increase number of uninsured, maintain stability in individual market, Congressional Budget Office projects

The nonpartisan Congressional Budget Office (CBO) late Monday, March 13, 2017, released its analysis projecting that enactment of the American Health Care Act (AHCA) would increase the number of uninsured Americans by 4 million in 2017, rising to an increase of 14 million by 2018 and to 24 million by 2026.1 Under the AHCA, the total number of uninsured would stand at 52 million in 2026, approximately 19% of the US population under age 65. By comparison, approximately 10% of nonelderly Americans currently are uninsured, and the CBO projects that the uninsured population in the US would remain about that level each year through 2026 under the Affordable Care Act (ACA).

According to the CBO, the nongroup health insurance market “would probably be stable in most areas” under either the ACA or the AHCA.
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House begins consideration of legislation to repeal and replace key provisions of the Affordable Care Act

The House Ways and Means Committee and the House Energy and Commerce Committee today (Wednesday, March 8, 2017) are scheduled to begin marking up the American Health Care Act (AHCA), which would repeal and replace certain provisions of the Affordable Care Act (ACA). House Ways and Means Committee Chairman Kevin Brady (R-TX) and House Energy and Commerce Committee Chairman Greg Walden (R-OR) released the draft legislation late Monday, March 6, 2017.

The House Ways and Means Committee has jurisdiction over tax provisions in the legislation, while the House Energy and Commerce Committee has jurisdiction over provisions related to Medicaid.

In general, the draft legislation would maintain the ACA’s tax credits and states’ option to expand Medicaid in their current forms through December 31, 2019. Under the AHCA, new tax credits and Medicaid funding formulas would take effect beginning January 1, 2020.

The draft legislation in its current form would not make changes to the individual tax exclusion for employer-sponsored coverage, or certain ACA health insurance market reforms, including allowing adult children up to age 26 to stay on a parent’s health coverage and a prohibition on denying coverage or rate setting based on an individual’s pre-existing health conditions.

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