This article was originally published on March 7, 2017, and has since been updated to reflect new information.
President Trump previewed health care policies in the works in his recent address to Congress.
And after weeks of negotiations, Republicans narrowly passed the bill with a vote of 217 to 213 in the House of Representatives.
While the bill is sure to undergo major revisions in the Senate, its passing gives us some insight into the changes to come.
Features of the new plan, called the American Health Care Act, include:
- Continuing to allow parents to cover adult children on their insurance until age 26.
- Rolling back penalties for the uninsured.
- Allowing states to opt out of 10 previously mandated health benefits.
- Repealing the requirement for employers with 50 or fewer employees to provide health insurance.
- Replacing income-based subsidies with age-based tax credits.
- Enacting a deadline of 2020 on the Medicaid federal expansion.
- Cutting funding to Planned Parenthood and limiting health insurance coverage for abortions.
The central aims of the plan are to “drive down costs, encourage competition, and give every American access to quality, affordable health insurance,” House Speaker Paul Ryan, R-Wis., said in a statement.
Opponents of the bill, including House Minority Leader Nancy Pelosi, D-Calif., say it delivers tax cuts to the rich and healthy. And it cuts assistance to high-need and low-income enrollees. “Republicans have decided that affordable health care should be the privilege of the wealthy, not the right of every family in America,” said Pelosi.
5 reasons you’ll pay more with the ACA replacement
The American Health Care Act still needs to get passed by the Senate before it’s finalized. But in its current state, it seems some of the 20 million Americans currently covered under the ACA will become uninsured, according to AP News.
And it is already clear some people will pay more for insurance under the new plan. If you’re not covered through your employer and have an ACA marketplace plan, you will be affected by these new policies.
But will you pay more? Here are some signs that you’ll probably face higher health care costs.
1. You’re low-income
Under the ACA, 11 million Americans earning up to $16,400 a year have free health coverage under the Medicaid expansion, according to CNN Money. The new health plan would provide some assistance for poor enrollees. But these tax cuts would be tied to age rather than income.
Overall, health care assistance available to low-income Americans through Medicaid, subsidies, and tax cuts would be much smaller, according to the Kaiser Family Foundation.
2. You have a pre-existing condition
Since the American Health Care Act’s introduction in March, policymakers added an amendment that allows states to opt out of some previously required benefits. Under Obamacare, insurance carriers had to provide certain services. Some of these services included:
- Maternity care
- Mental health and substance abuse
- Preventative care
- Pediatric services
Under the new plan, states can seek waivers for insurers who don’t offer these services. Plus, states could opt out of the mandate that prevents carriers from charging people extra for pre-existing conditions.
So, if you have a preexisting condition or need services like maternity or mental health care, you could end up paying a lot more under the new plan.
3. You rely on subsidies to reduce premiums
ACA subsidies help those above the poverty line afford health care premiums. If you rely on these subsidies, you are likely to pay more under the new plan. It will end government subsidies that helped reduce individuals’ health insurance premiums.
Enrollees living in high-premium states – Alaska and Arizona, for instance – receive subsidies scaled to their higher costs. But the new tax cuts are based on age alone, not local costs. People who relied on subsidies from the ACA to pay for their state’s sky-high premiums will have less help to cover these costs. This map tool compares the difference in tax credits Americans would receive under the ACA and the new Republican health plan.
4. You’re over 50
Older Americans will also receive less health care assistance. Even though the age-based tax cuts give those ages 60 and over the highest break, at $4,000, it’s still less than what they receive under Obamacare.
Insurance premiums will also increase. Under the ACA, insurers cannot charge older enrollees premiums greater than three times the cost of plans for younger, healthier participants. The replacement bill would charge seniors five times more than younger participants, reports CNN Money.
This would raise premiums by $2,100 annually for the average 64-year old, according to a report from the AARP. Around 400,000 seniors will lose coverage as a result.
5. You have high health costs
Another ACA rule that will be done away with are the plan coverage requirements that dictate how much coverage plans had to provide. With these regulations gone, insurers will likely expand their selections again, including offering high deductible, low-premium plans. For those who are healthy and can afford to choose a plan with a high deductible, this could result in lower premiums.
Enrollees who are sick and rely on their insurance to cover their costs often need low-deductible plans. Without these guidelines in place, plans that provide sufficient coverage could be harder to find and more expensive.
Who will pay less with the ACA replacement?
It’s hard to know exactly how these rules will affect health insurance markets, and there are disagreements over whether insurance premiums will increase or fall.
But some people who rely on ACA health plans are more likely to see their costs fall under the American Health Care Act rules:
- Younger enrollees will likely face lower premiums and more health care assistance.
- Healthy people will be able to buy cheaper, catastrophic health insurance.
- Higher-income enrollees who don’t receive assistance might benefit from lower premiums.
- Enrollees in areas with lower premiums might get more assistance than they did under the ACA.
- People who save through tax-advantaged health savings accounts can now contribute twice as much to these accounts.
Beyond health plans, repealing the ACA also rolls back taxes on the very rich, giving them a huge tax cut. The top one percent will keep $33,000 more a year, according to CNN Money. And the top 0.01 percent would get an average tax cut of $197,000 a year.
The American Health Care Act isn’t final
The bill is far from final, and likely to undergo changes if it has a chance of getting voted into law. But it’s final enough that House Republicans managed to secure a favorable vote.
Many lawmakers in the Republican Party are feeling pressure from their constituents to deliver a smart, cost-cutting health care bill.
Whether you favor or oppose the new health care plan, there’s still time to contact your senators to let them know what you think.
Rebecca Safier contributed to the reporting for this article.
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