Tag: American Health Care Act

As reported in our January 23, 2017 post entitled “Status of the Affordable Care Act Repeal Efforts,”¹ on January 12 and 13, 2017, the Republican-controlled Congress took the first step toward repealing certain provisions of the Patient Protection and Affordable Care Act (“ACA”) (Public Law 111-148) by adopting a fiscal budget resolution containing a “reconciliation directive” to House and Senate committees to prepare ACA repeal legislation by January 27, 2017.²  In addition, one of President Donald Trump’s first actions upon taking office was to implement an Executive Order stating an intent to repeal the ACA and directing Congress “to minimize the unwarranted economic and regulatory burdens of the [ACA] and . . . to afford the States more flexibility and control to create a more free and open healthcare market.”³

On March 6, 2017, the House Committees on Ways and Means and Energy and Commerce proposed the American Health Care Act (“AHCA”) pursuant to the budget-resolution process.  As previously discussed, the budget-reconciliation process allows Congress to repeal provisions of the ACA that directly impact government taxes and revenue and only requires a simple majority vote.  A full repeal of the ACA, and any comprehensive replacement legislation involving provisions that extend beyond tax and revenue, would require 60 votes in the Senate, necessitating Democratic support.⁴  Set forth below under “Next Steps” is a discussion of the applicable procedural requirements for the AHCA to become law.

Summary of Key Changes

The following is a summary comparing the significant changes the AHCA would effect to current law:

MEDICAID & OTHER GOVERNMENT FUNDING PROGRAMS

INDIVIDUALS^[7]

EMPLOYERS

INSURERS

PROVIDERS

MEDICAL DEVICE MANUFACTURERS

Next Steps

On March 13, 2017, the Congressional Budget Office (“CBO”) and the staff of the Joint Committee on Taxation released an estimate of the budgetary effects of the AHCA.⁹  The CBO estimated that the AHCA will save $337 billion dollars over the 2017 to 2026 period and result in lower deficits, reduced Federal spending and tax cuts.  The report concluded that the health insurance market would remain stable because other provisions of the bill would lower premiums “enough to attract a sufficient number of relatively healthy people to stabilize the market.”  The report determined that average premiums would be initially higher by 15 to 20% but thereafter drop around 10% by 2026.  The report estimates that in 2020, 21 million more non-elderly people would be without health insurance and that this number will increase to 24 million people by 2026 to 52 million people.

The AHCA has been approved by the Ways and Means Committee and the House Energy and Commerce Committee.¹⁰  On March 16, 2017, the Budget Committee likewise voted to approve the AHCA after recommending some amendments for the Rules Committee to consider.¹¹  The Rules Committee will consider amendments by the Budget Committee and other party leaders before a full House vote.¹²  President Trump has also proposed amending the AHCA before the House vote via a Manager’s Amendment.¹³  After House approval, the AHCA would need to be approved by a simple majority of the Senate, at least 51%, before it is presented to the President for signing.

_{1   http://www.cadwalader.com/resources/clients-friends-memos/status-of-the-affordable-care-act-repeal-efforts.}

_{2   https://www.congress.gov/115/bills/sconres3/BILLS-115sconres3es.pdf.}

_{3   https://www.whitehouse.gov/the-press-office/2017/01/2/executive-order-minimizing-economic-burden-patient-protection-and.}

_{4   2 U.S.C. § 644.}

_{5   See discussion in row entitled “Allotments for Disproportionate Share Hospitals” in “Providers” section below.}

_{6   https://www.hhs.gov/open/prevention/.}

_{7   This section does not address effects of proposed changes in Medicaid reimbursement and other payment changes on individuals, including the increase in rates insurers may charge individuals over 60 set forth under “Variation of Health Insurance Premium Rates” in the Insurers section below.}

_{8   Although the requirement that private plans maintain essential health benefits would remain, as noted in the “Employers” section above, the AHCA would repeal penalties for failure to provide essential health benefits.}

_{9   https://www.cbo.gov/publication/52486.}

_{10  https://waysandmeans.house.gov/ways-means-republicans-take-historic-action-repeal-obamacare-ensure-americans-access-affordable-care/; https://energycommerce.house.gov/news-center/press-releases/energy-and-commerce-committee-advances-legislation-repeal-and-replace.}

_{11  http://budget.house.gov/news/documentsingle.aspx?DocumentID=394574.}

_{12  http://www.businessinsider.com/house-budget-committee-trumpcare-ahca-vote-2017-3; https://www.theguardian.com/us-news/2017/mar/09/republican-healthcare-plan-house-approvals-obamacare; http://www.ajmc.com/newsroom/hhs-secretary-tom-price-responds-to-ahca-questions-and-concerns-during-town-hall; https://www.washingtonpost.com/graphics/politics/obamacare-replacement-next-steps/.}

_{13  http://www.reuters.com/article/us-usa-obamacare-amendment-idUSKBN16L2FS?il=0.}