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GOP health bill is out: 10 things to know this morning

Mar 08, 2017

[From Becker's Hospital Review]

After years of lobbying to repeal and replace the ACA, House Republicans put forth The American Health Care Act on Monday. Here are 10 things to know about the legislation.

1. The AHCA would eliminate the ACA's individual mandate, or requirement for American adults to enroll in health insurance. Further, the legislation eliminates the tax penalty adults faced if they were not covered. However, the concept of penalties still remains in some form: To encourage people to buy coverage, the AHCA lets insurers charge a 30 percent penalty for those who let their health plans lapse and try to buy a new policy, according to NPR.

2. The AHCA calls for Medicaid expansion to remain in effect through Jan. 1, 2020. This is different from earlier drafts of legislation, which called for an immediate reversal of Medicaid expansion. Thirty-two states, plus Washington, D.C., have opted to expand Medicaid under the ACA. By 2020, the government will "freeze" the expanded programs and restrict funding only to people who were in the program as of then — no added enrollees from that date on. States would keep getting that amount of federal aid for each Medicaid enrollee as long as the enrollee doesn't lose eligibility for more than a month. There is also a provision in the AHCA that calls for grants of extra Medicaid provider reimbursement funds to go toward states that didn't expand Medicaid.

3. The AHCA restructures Medicaid's federal funding to a per-capita cap opposed to the current open-ended federal entitlement, reports Politico. States would receive capped payments based on how many people are enrolled in Medicaid. The plan also calls for more frequent eligibility testing of Medicaid enrollees.

4. The AHCA restructures Americans' tax credits to buy health insurance. It replaces income-based subsidies under the ACA with refundable, age-based and income-capped tax credits, according to Politico. These credits increase with age, from as low as $2,000 for those under 30 or as high as $4,000 for those over 60. There would be a limit as far as credits for a single household — $14,000 — and subsidies would be eliminated over time for individuals with annual income of $75,000 and for families with annual income of $150,000, according to the report.

5. A few ACA staples roll over in the AHCA. The ACA provision related to pre-existing conditions would remain intact, meaning insurers would not be able to deny coverage or increase prices for people with such conditions, reports Reuters. Also, the AHCA retains provisions allowing adults up to age 26 to maintain coverage through their parents' health plans, according to the report.

6. The AHCA eliminates the cap on the tax exemption for employer-sponsored insurance. Although earlier drafts of legislation capped the exemption at 90 percent of current premiums, the final version eliminated the proposal, according to Politico. The bill also gets rid of the penalty for businesses that do not offer employees health coverage.

7. The AHCA delays the effective date for the ACA's Cadillac Tax on costly health plans from 2020 to 2025, according to The Hill. GOP lawmakers are delaying but keeping the tax to make certain their replacement plan will not increase the national deficit after a decade.

8. The AHCA bars federal Medicaid funds or federal family planning grants for Planned Parenthood clinics, according to the report. (Separate from the AHCA, the White House earlier this week extended terms for a compromise to Planned Parenthood by proposing maintained federal funding if the group agrees to discontinue providing abortions, according to ABC News.)

9. The cost of the AHCA is not yet known. The nonpartisan Congressional Budget Office has not yet scored the legislation, which means there is neither a cost estimate for the plan or how many Americans would gain or lose insurance under it.

10. What's next? The House Ways and Means and Energy and Commerce committees are expected to review the AHCA legislation Wednesday. If the committees approve the measure, the full House could potentially act on it before April 7, according to The New York Times. The measure would then be taken up by the Senate.