Where it stands now.
Republicans have presented a revised health care reform bill, proposing to repeal and replace the Affordable Care Act (ACA) in favor of the American Health Care Act (AHCA).
Here’s a look at the proposed changes.
MANDATE
People will no longer be required to get health care coverage. But with the individual mandate disappearing, lower participation among healthy people may drive insurance prices up. To encourage continuous coverage, The plan proposes a 30% penalty on premiums for anyone whose coverage has lapsed more than 63 days. Companies also will no longer be required to provide affordable health insurance options to employees.
TAXES
Tax credits to help offset premiums will go away. Tax increases on tanning, high incomes, and manufacturers of prescription drugs and medical devices will roll back.
MEDICARE
Cuts federal funding for Medicare expansion and shifts it to states.
PRE-EXISTING CONDITIONS
Under the ACA, people have access to the same health plans at the same cost and eligibility as everyone else with no regard to pre-existing conditions. Under the new bill, each state may apply for a waiver from that requirement, allowing them to instead set up high-risk pools at a higher cost for individuals with health issues who have allowed their health coverage to lapse for more than 63 days.
SENIORS
Currently, people aged 64 or older may be charged up to three times as much as younger people for health coverage. The bill proposes to widen that cost gap to five times as much. Additionally, states may widen that cost ratio further. Subsidies to help with premium costs would shift from income and location-based to age-based.
ESSENTIAL BENEFITS
Under the ACA, medical plans must cover ten essential benefits, including maternity and emergency services. The AHCA eliminates those essential benefits and allows each state to create their own standards.
CAFETERIA PLANS
Almost doubles health savings account (HSA) allowable contributions, to $6,550 individual and $13,100 family maximums. Repeals FSA contribution limits (currently $2,500) beginning 2018 and again allows over-the-counter medicines.
These changes are not finalized. The AHCA proposed bill narrowly passed the House of Representatives and is expected to stall and undergo further changes in the Senate. All changes are tentative at this time.
Nextep will continue to watch the situation and keep you informed of developments.
Questions? We’re here to help! Please contact our benefits team online, via chat, in the help section of your account, or at 888-811-5150.
