Fate of Obamacare now is in the Senate
The House Republicans passed the American Health Care Act with a slim majority on Thursday. The bill gives states the option of returning to a pre-Obamacare individual insurance approach of medical underwriting and high-risk pools.
The bill passed by a vote of 217-213 in the U.S. House of Representatives on Thursday afternoon, one vote over the 216-majority threshold. It is the GOP's first successful attempt to move legislation to repeal President Barack Obama's signature healthcare reform bill, the Affordable Care Act, during the Trump administration after two false starts. If it passes the Senate, the AHCA will make stark changes to the rules and regulations governing the healthcare industry for the last seven years.
"We can continue with the status quo under Obamacare. We know what that looks like," House Speaker Paul Ryan said during debate on the AHCA Thursday afternoon. "It means even higher premiums. Even fewer choices. Even more insurers pulling out. Even more uncertainty and chaos."
"We can put this collapsing law behind us," he added. "End this failed experiment."
Although the latest tweaks to the bill revolved around treatment of high-cost customers on the exchanges in an effort to win moderate votes, the ACHA's biggest impact is effectively ending the Medicaid expansion after 2020. The majority of people who have gained coverage under the ACA have obtained it through Medicaid—about 14.5 million people nationally—including 5 million who already qualified for the government health insurance but hadn't previously applied for it.
"Rural hospitals will close, two million jobs will be destroyed across America, and all of this to give a massive tax cut to the richest in America," House Minority Leader Nancy Pelosi said. "It's Robin Hood in reverse."
The bill would not allow expansion-eligible people who left Medicaid, even for just over a month, to return to the program. That could impact many potential Medicaid beneficiaries who work intermittently, have seasonal or part-time jobs, and cycle in and out of Medicaid as they gain or lose employer coverage or cross the earnings limit. In Connecticut, 30% of exchange customers came from or go to Medicaid in the course of a year. National studies of churn have estimated it at 25% annually.
And starting in 2020, states would have to pay for their full share of covering the expansion population. For some states, that would be a shift from 90% funding to 50% funding. Even in Kentucky, it would be an increase in state responsibility of almost 20 percentage points.
In Ohio, where 700,000 people have gained coverage in the expansion, the state would have to shoulder an additional $2.2 billion if that many people were still on the rolls in 2020.
Where will that money come from? In this year's budget proposal, Ohio already plans to cut Medicaid rates for nursing homes and hospitals, according to the Columbus Dispatch, because of the uncertainties around ACA repeal. Over the next two years alone, Ohio hospitals would have more than an 8% cut, or $588 million.
The seismic effect of reduced matches for the newly eligible doesn't include the impact of a per-capita cap on Medicaid. Overall, the Congressional Budget Office estimated that the bill would reduce federal spending on Medicaid by $880 billion across nine years, starting in 2017. The CBO analysis was of a previous iteration of the bill, but the new versions haven't changed the effects to Medicaid. The office also said the bill would cause 24 million people to lose their healthcare coverage.
American Medical Association President Dr. Andrew Gurman said in a statement Wednesday that none of the amendments to the American Health Care Act would curb the "serious harm" the bill poses to patients and the healthcare delivery system.
"Proposed changes to the bill tinker at the edges without remedying the fundamental failing of the bill—that millions of Americans will lose their health insurance as a direct result of this proposal," he said.
The tweaks to the bill also didn't alter the less generous subsidy structure for older exchange customers, particularly in markets where insurance is more costly.
There's a lot of fury around the country over the conservative healthcare reform bill, which has been expressed at Congress members' town halls and in protests. A number of Republican senators whose votes are needed for a replacement bill have said that the House version will not survive in their chamber.
First, there are procedural issues on whether the state-waiver plan can be included and still qualify for a 51-vote majority.
A number of Republican senators also have ideas of how to improve the bill.
Sen. John Thune (R-S.D.) told Axios that he'd like to preserve income- and age-based subsidies for customers below 250% of poverty.
Sen. Rob Portman (R-Ohio) has talked about a rolling phaseout to smooth the transition of repealing the Medicaid expansion. However, his office declined to provide details on his plan.
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