…who rely on the federal government for their health insurance.
The bill reaches into every major American health care program: Medicaid, Medicare, and the Obamacare marketplaces.
These are expected outcomes based on two key policy changes in the bill. First, the bill repeals the individual mandate, a key piece of Obamacare that requires most Americans get covered. Economists expect its elimination to reduce enrollment in both the Affordable Care Act’s private marketplaces and Medicaid by millions. The money saved will be pumped into tax cuts for the very wealthy.
The bill also includes tax cuts so large that they would trigger across-the-board spending cuts — including billions for Medicare. The last time Medicare was hit with cuts like this, patients lost access to critical services like chemotherapy treatment.
This tax bill deserves a broader name. Its policies will cause millions of vulnerable Americans to lose coverage, disrupt care for the elderly, and potentially change the health care system in other ways we can’t fully predict.” (A)
“Health care became intimately mired in the tax reform debate as Senate Republicans heeded President Trump’s call to tack on a repeal of Obamacare’s individual mandate, one of the health law’s most unpopular measures, into their plan. The mandate requires all Americans to carry insurance (subsidized for the vast majority of people buying individual health insurance plans) or pay a tax penalty.
Trump and the Congressional GOP have long aimed to nix that requirement. But they’ve been unsuccessful to date in part because the CBO has projected that repealing the mandate would lead to millions of fewer insured Americans relative to current law while also hiking rates. And while experts may quibble over the precise magnitude of those effects, the CBO hasn’t equivocated about the overall trend.
“There’s a lot of uncertainty around how effective the mandate has been,” Larry Levitt, senior vice president at the independent health care think tank Kaiser Family Foundation (KFF), told Fortune in an interview. “But CBO has said the direction of the effect is clear. Repealing the mandate would increase premiums, would increase the number of people who are uninsured.”
Just how big of an effect would a mandate repeal have? According to CBO, 13 million fewer people would be insured in 2027 compared with current law while premiums would spike 10%. That’s because, without the policy “stick” of a mandate, healthier and wealthier people would likely drop out of Obamacare’s marketplaces, in turn making individual insurance risk pools more costly by disproportionately leaving them with sicker Americans.” (B)
“President Trump at a closed-door meeting with GOP senators on Tuesday said he would support two proposals meant to stabilize ObamaCare’s insurance markets in exchange for a repeal of the law’s individual mandate, several Republicans in attendance said.
The two bills would fund key ObamaCare insurer payments, and provide billions to help states create reinsurance programs for high-cost patients.
Passage of the measures could prove crucial to winning support for the Senate tax bill, which includes repeal of ObamaCare’s mandate, from Sen. Susan Collins (R-Maine)….
Collins left the meeting feeling she’d been reassured by Trump that he’d support both bills.
“[Trump] said that he understood the need to have something to offset the premium increases and appeared very open” to signing the two bills into law, she said.” (C)
“Sen. Susan Collins (R-Maine) said early Thursday that she expects legislation to lower health-care premiums to pass Congress before senators take a final vote on a $1.5 trillion tax-reform bill that would repeal the Affordable Care Act’s individual mandate….
To mitigate the impact, GOP leaders plan to pass legislation negotiated by Senate Health Committee Chairman Lamar Alexander (R-Tenn.) and Sen. Patty Murray (Wash.) that would reinstate cost-sharing reduction payments to insurance companies.
It will be paired with legislation sponsored by Collins and Sen. Bill Nelson (D-Fla.) that would set up health reinsurance programs for older and sicker individuals.
The measures are likely to be attached to a government stopgap funding bill, Collins said.
“I have met with the president of the United States about this and have gotten his endorsement, I’ve met with the Republican leadership and with the members of the Finance Committee,” she said. “They are most likely to be on the continuing resolution.”
“Assuming the tax bill passes the Senate, we then turn to the CR and those two bills will be put on the CR,” she said.
“While the tax bill is in conference, the CR will presumably become law and then the tax bill come back from conference,” she said. “So I’m going to know whether those provisions made it and that matters hugely to me.”” (D)
“Larry Levitt, an Obamacare expert with the Kaiser Family Foundation, told CNBC that “Alexander-Murray, as it’s currently drafted, wouldn’t really do anything to mitigate the effects of repealing the individual mandate.”
But funding reinsurance programs “could offset any premium increase” resulting from repeal, Levitt said.
Totally offsetting such price hikes from repeal would require some additional funding, and extending reinsurance beyond the two-year span outlined in Collins’ bill, he said.
However, “it wouldn’t do anything to deal with the fact that more people are likely to be uninsured” as a result of the mandate’s repeal, Levitt said.
If the mandate is repealed, the CBO estimates that 13 million more people would become uninsured by 2027 than are currently projected.
“Most of the losses [in insurance coverage] are due to the fact that people are not getting pushed into getting coverage,” Levitt said.
Sen. Patty Murray, D-Wash., who co-authored the Alexander-Murray bill, told The Washington Examiner, “I support reinsurance, but it won’t solve the problem they created,” referring to the mandate repeal.
“The bill we designed has not been written to block the premiums they’re creating,” Murray said.
Republican lawmakers as a group are less likely to be concerned with the increase in the number of uninsured people.
“The premium increases on middle-class consumers is probably the most troubling part of repealing the individual mandate, particularly for Republicans,” Levitt said.
Many middle-income Americans earn too much to qualify for Obamacare subsidies that lower monthly premiums. That means those people bear the full brunt of premium increases.” (E)
“The Senate Republican plan to use tax legislation to repeal the federal requirement that Americans have health coverage threatens to derail insurance markets in conservative, rural swaths of the country, according to a Los Angeles Times data analysis.
That could leave consumers in these regions — including most or all of Alaska, Iowa, Missouri, Nebraska, Nevada and Wyoming, as well as parts of many other states — with either no options for coverage or health plans that are prohibitively expensive.
There are 454 counties nationwide with only one health insurer on the marketplace in 2018 and where the cheapest plan available to a 40-year-old consumer costs at least $500 a month. Markets in these places risk collapsing if Congress scraps the individual insurance mandate.
“It’s very, very concerning to us,” said Denise Burke, healthcare analyst at the Department of Insurance in Wyoming, where the cheapest plan for a 40-year-old consumer in most of the state will cost $586 a month next year.
The precise nationwide impact of the Senate GOP tax plan, which would eliminate the Affordable Care Act’s unpopular mandate penalty, is unclear, as many forces affect how much insurance costs and where insurers sell plans.
But the legislation is widely expected to cause insurers to raise prices or exit markets out of fear that fewer healthy people will buy plans if there is no longer a penalty for going without coverage.
The risk is greatest in places where health insurance is already very expensive and where there are few insurers.” (F)
“But the argument that getting rid of the mandate will improve people’s well-being by allowing them to opt out of coverage without a penalty is weaker than it first sounds, as per this analysis by Aviva Aron-Dine. She draws heavily on the Congressional Budget Office’s estimate that repealing the mandate will lead to 13 million fewer people with coverage and a 10 percent increase in premium costs.
First, the mandate isn’t in the Affordable Care Act just for fun. Health coverage plans with cost controls typically have some version of a mandate to avoid “adverse selection,” wherein the people who buy health coverage tend to be those who need it the most, making it too expensive for others. This undermines health insurance markets, which work through the healthy subsidizing the sick. If that sounds unfair, consider that at some point, you could be either one of those people (i.e., healthy or sick), but you can’t know now which one you’ll be. That’s the problem insurance solves.
Aron-Dine argues that because of this dynamic, “some of the coverage losses from repealing the mandate would not be ‘voluntary’ in any sense.” Instead, they’d be a function of higher premiums due to healthier people leaving the risk pool.
Next, consider that according to the CBO, about half of those budget savings come from fewer people on Medicaid. What’s up with that? After all, Medicaid recipients don’t pay premiums, so why would repealing the mandate affect them either way?
It’s because, as Aron-Dine notes, “the mandate also serves a critical outreach function, leading uninsured people who are unaware of their eligibility for marketplace subsidies or Medicaid to explore their available options and then enroll.” The CBO estimates that this ultimately will lead to 5 million fewer people with Medicaid coverage.
Then there’s the risk that people who don’t get coverage pose to themselves and, through negative spillovers, to the rest of us. Those who decide to forgo coverage are making a bet that they won’t get sick. But some will lose that bet, and when they do, these patients will receive “uncompensated care” because hospitals must treat the sick regardless of their insurance status. And you know who pays for such care, right? The rest of us.” (G)
“Throughout this decadelong healthcare debate, the organization I lead, the National Coalition on Health Care, has urged Congress to pursue bipartisan solutions in healthcare. We have called for reforms that improve our health system and reduce costs through evidence-based policy—but instead, Congress is pursuing across-the-board cuts hidden in a tax bill.
In the individual market today, bipartisan solutions would mean continuing cost-sharing reduction payments and stabilizing premiums—without pushing millions off health coverage. Instead, the Senate tax bill’s repeal of the individual mandate would increase the number of uninsured by 13 million and increase premiums in the nongroup market by about 10%, according to the Joint Committee on Taxation and the Congressional Budget Office.
In Medicaid today, bipartisan solutions would mean fostering state innovation, not shifting the cost burden onto states, beneficiaries or providers. States are already making efforts to transform their care delivery systems by helping beneficiaries remain independent in their homes and integrating care for lower income seniors and disabled individuals enrolled in both Medicare and Medicaid. Targeted federal policy has the ability to improve and expand upon these initiatives. Unfortunately, in this bill much of the savings attributed to the individual mandate repeal would come from a substantial reduction in federal support for state Medicaid programs. An analysis of the mandate repeal published recently by the CBO projected those Medicaid cuts would total $179 billion over 10 years.
In Medicare today, bipartisan solutions would mean improving the quality of care and reducing costs while avoiding indiscriminate cuts that harm beneficiaries. The Senate-passed CHRONIC Care Act is one example of such an effort, providing vital flexibilities to enable providers and health plans to deploy high-tech telehealth and high-touch personal support to improve care for the chronically ill.” (H)
“While the ACA is not perfect, it has provided an important pathway for moving from peril to progress in strengthening America’s health care system. It is important to remember that in 2008, prior to the ACA’s enactment, 82 percent of Americans wanted an overhaul of the U.S. health care system at a time when over 47 million people — or 18 percent of the U.S. population — lacked health insurance. The historic passage of the ACA signed into law by President Obama in 2010 represents the most significant and comprehensive health care legislation since the establishment of Medicare and Medicaid in 1965 and it has transformed the U.S. healthcare system. Through its reforms, the legislation has enabled 20.4 million people to gain insurance coverage by 2016. Medicaid expansion itself covered 11 million people, including nearly two million Americans in rural areas. Furthermore, the ACA’s coverage mandates protect the nearly 129 million Americans with pre-existing conditions — or one in two people — from being charged discriminatorily higher premiums or denied coverage. The ACA’s provisions also put into place payment reforms that incentivized quality care over quantity of medical services provided and fueled a prevention revolution through the provision of preventive services at no cost to consumers in their insurance plans, the establishment of a Prevention and Public Health Fund to support community prevention programs, and the creation of a National Prevention Strategy with the participation many governmental departments and numerous stakeholders.
This is not the time to sabotage the ACA legislation but rather the very moment to strengthen it. Since the establishment of the Affordable Care Act in 2010, much progress has been made to advance America’s health care system in communities, states and nationally. The significant achievements made since the law’s enactment highlight the importance of working together to safeguard, improve, and expand on the ACA’s progress to improve the health of all Americans now and in the years ahead.” (I)
“Gov.-elect Phil Murphy said Wednesday he plans to examine New York Gov. Andrew Cuomo’s efforts to preserve health insurance coverage for residents of his state as a model for New Jersey if parts of the Affordable Care Act are repealed under a new Republican tax bill in Congress….
In June, Cuomo issued emergency regulations requiring any private insurer to guarantee the 10 “essential health benefits” offered under Obamacare, and blocking any insurer that withdraws from New York’s health insurance exchange from participating in Medicaid or its children’s health plan.
But Murphy was adamant that his first priority should be to pressure Congress to preserve the individual mandate to buy health insurance that serves as the Affordable Care Act’s linchpin.
“Make no mistake,” said the governor-elect. “There’s almost nothing the state can do to replace the federal government.”
The current tax reform bill in the U.S. Senate also threatens to slash health insurance for the 900,000 New Jerseyans who’ve gained access to health care under Obamacare by scrapping the the individual mandate requiring people to buy health insurance through a Medicaid exchange or pay a penalty.” (J)
(A) Is it a tax bill or a health care bill?, by Sarah Kliff, VoxCare, November 30. 2017
(B) GOP Tax Plan Would Still Leave 13 Million Without Health Insurance, CBO Says, by Sy Mukherjee, http://fortune.com/2017/11/29/gop-tax-plan-obamacare-cbo/
(C) Trump backs bipartisan fixes to ObamaCare markets, by JESSIE HELLMANN, http://thehill.com/policy/healthcare/362168-trump-backs-bipartisan-fixes-to-obamacare-markets
(D) Collins: Health-care fix will pass before tax bill, by ALEXANDER BOLTON, http://thehill.com/homenews/senate/362537-collins-health-care-fix-will-pass-before-tax-bill
(E) Why a new GOP idea won’t solve biggest problem with repealing Obamacare’s mandate, by Dan Mangan, https://www.cnbc.com/2017/11/28/gop-idea-wont-solve-biggest-problem-with-repealing-obamacare-mandate.html
(F) Republicans’ latest plan to repeal Obamacare’s insurance requirement could wreak havoc in some very red states, by Noam N. Levey, http://www.latimes.com/politics/la-na-pol-insurance-mandate-repeal-20171127-story.html
(G) How the Republican tax cut plan goes after health care, by Jared Bernstein, https://www.washingtonpost.com/news/posteverything/wp/2017/11/27/how-the-republican-tax-cut-plan-goes-after-health-care/?utm_term=.23fcc55219d5
(H) Guest Commentary: Tax reform should mean improving the economy, but not at the expense of our healthcare system, by John Rother, http://www.modernhealthcare.com/article/20171129/NEWS/171129914
(I) Safeguarding America’s Health System from Sabotage, by Susan Blumenthal, M.D. and Alexis Boaz, https://www.huffingtonpost.com/entry/safeguarding-americas-health-system-from-sabotage_us_5a1ecf33e4b0e37da0447b66
(J) Murphy says he’d consider emergency action to save Obamacare for N.J., by By Claude Brodesser-Akner, http://www.nj.com/politics/index.ssf/2017/11/following_cuomo_murphy_will_consider_obamacare_exc.html#incart_river_home