Big news out of Washington is that The House of Representatives voted to approve the American Health Care Act (AHCA). This Republican bill to repeal and replace Obamacare could mean big changes for many Americans. The next step for this bill is to go through the Senate. Here are some things to know:
1. This Could Affect Essential Health Benefits
The Affordable Care Act (ACA) has created a list of 10 essential health benefits that insurance plans must offer, many of these had been previously excluded from policies, pre-ACA, on the individual market. These 10 essential benefits are as follows:
- Outpatient care without a hospital admission, known as ambulatory patient services
- Emergency services
- Pregnancy, maternity, and newborn care
- Mental health and substance use disorder services, including counseling and psychotherapy
- Prescription drugs
- Rehabilitative and habilitative services and devices, which help people with injuries and disabilities to recover
- Laboratory services
- Preventive care, wellness services, and chronic disease management
- Pediatric services, including oral and vision care for children
The amended American Health Care Act would allow states to apply for a waiver to define their own essential health benefits starting in 2020. This would mean that insurance carriers could decline to offer costly benefits if they are not required to, or if they do, they might do so at a much higher price making coverage unaffordable for most consumers.
It’s important to mention that without essential health benefits, coverage for pre-existing conditions would be inconsequential. The changes in essential health benefits coverage could also affect people with health care coverage through an employer. The ACA required all health insurance plans to have an out of pocket maximum limiting the amount of what the patient would have to pay in a given year. But this only applies to benefits that are considered essential health benefits.
Under the new bill, employers could choose any state's definition of essential health benefits, and those companies seeking to lower cost could choose leaner plans that could possibly leave workers with the responsibility of covering large cost if they receive a serious health diagnosis or are injured.
2. No Mandate - Different Penalty
The AHCA does not mandate that all Americans covered by health insurance pay a fee, like the under ACA. It repeals the individual mandate, which was one of the ACA’s least popular provisions. Instead, it has instated a different penalty. The new mandate would mean that people who decide to remain uninsured and do not maintain continuous coverage will pay a hefty fine when they want to re-enter the insurance market. The whole point of this change is to do what the individual mandate did: encourage healthy people to buy coverage. There is concern, however, that this provision could actually discourage healthy people from buying insurance because they would be turned off by the higher prices when they did return to the individual market.
3. The AHCA would phase out the Medicaid expansion that was put in place by the ACA.
This expansion extended health care coverage to more than 10 million low income families who otherwise couldn’t afford health insurance. States would be allowed to continue to enroll people in Medicaid until the year 2020, then it will freeze and no other enrollees can be added. The bill would also restructure all of Medicaid. This could lead to benefit cuts for 74 million Americans who depend on the program, including lower income beneficiaries as well as the disabled and the elderly.
4. The Effects of Benficiaries with Pre-Existing Conditions
The AHCA plan would allow insurers to charge sick people more for their coverage under certain circumstances. Insurers would still not be able to outright deny someone with pre-existing conditions, however they would be able to charge higher premiums to those who do not maintain continuous coverage.
5. The ACA currently restricts how much insurers can charge their oldest enrollees in the individual marketplace.
It says that insurers can only charge the oldest enrollee three times as much as the youngest, which pushes down premiums for those in their 50’s and 60’s. The AHCA would get rid of that regulation, allowing insurers to charge their oldest enrollees up to five times as much as their youngest ones.
These are just some of the changes that will come about if the AHCA is passed. The people who will not be affected by these changes are the ones who are already enrolled, or will enroll in an insurance plan within the next 6 months. It is imperative that those who do not currently have insurance start looking into their options now and lock into something before they may be faced with penalties. For those currently enrolled in a plan, if you are not satisfied with your current policy, now is the time to look into other options available to you.
We will continue to keep a close eye on any developments with the American Health Care Act as they come and continue to keep you informed on how this bill could change the healthcare system. If you are unhappy with any of these possible changes, reach out to your State Representative or your Congressman and let your voice be heard.