Wednesday, President Trump says he expects a healthcare plan to come forward as soon as next month. “Maybe mid to early March we’ll be submitting something that I think people will be very impressed by,” Trump told reporters, according to The Hill article published on February 22nd.
Presently, it’s unclear whether President Trump is referring to a new plan that will be introduced by the White House, or one of the proposals that have been submitted by Congress (“A Better Way” and “The Patient Freedom Act”.) According to a statement made by Speaker Paul Ryan (R-Wisconsin), “an ObamaCare repeal and replace bill would be introduced after this week’s break.”
According to the Associated Press, Republican senators who hosted Health and Human Services Secretary Tom Price, said his message was that the administration wants to work with lawmakers on the replacement plan. The details of the replacement plan remain unclear. House Republicans did circulate an outline consisting of tax credits, an expansion of health savings accounts, money for high risk pools to care for the sick and a major restructuring of Medicaid to cap federal payments.
No dollar figures for any of the Republican proposals have been presented yet. Still, the documented circulation shows progress. The plan does call for a refundable, advanceable tax credit to help individuals afford healthcare covered. However, unlike the current model, the tax credit would be based on the person’s age, not their income. Democrats argue that by not taking income into account, the system would fail by not providing enough assistance to low-income individuals and families. On the contract, Republicans say factoring income discourages work.
Additionally, the outline also dives into the repeal of the ACA’s Medicaid expansion “in it’s current form.” After a transitional period, states would be able to accept newly eligible Medicaid recipients but no longer receive extra federal funding to cover the costs. That means states would be responsible for putting more money into the program, if they wanted to keep the original expansion. The outline also recommends a “per-capita cap” for Medicaid, meaning the traditional, open-ended federal commitment would be then converted into a capped payment to states. The amount would consider the number of people in the program, in contrast to a simple block grant.
Democrats and Republicans continue to disagree, as Democrats warn this idea would lead to damaging cuts to the Medicaid Program. Where Republicans say it is a way to limit federal spending and give states more control. Republicans also say they plan to reverse the cuts that ACA made to the payments for hospitals serving large numbers of uninsured people, known as “Disaproportionate Share payments.” Resuming payments will help states that did not expand Medicaid and are bearing higher healthcare costs.
The outline also calls for repealing “all” of the taxes used to pay for the ACA. While some lawmakers have called for keeping most of those taxes in place to provide revenue for a new plan, it appears they have lost that debate.
The biggest piece of the outline is the immediate repeal for penalties violating ACA’s individual and employer mandates. That move could cause serious concern for insurers, who say the individual mandate is crucial for getting healthy people to enroll, balancing the risk pool. The CBO agreed, as they previously found repealing the mandate would increase premiums by roughly 20%.
As we continue on with the proposed plans for repealing and replacing ACA, lawmakers continue to bring additional ideas. It’s unclear which direction ACA will be headed, however, it looks promising that March will bring an official announcement of a plan to move forward. It’s important to remember, ACA is still effective (all subsidies, penalties and additional mandates set forth.) Clients still need at least minimum essential health coverage, if not a complete ACA plan. Contact the Agent Pipeline Life & Health Division for further guidance on how to assist your clients enrolling in credible health coverage, or a health plan that meets both their medical and financial needs. Call us today at 800-962-4693 for more information.