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Houses Passes the American Health Care Act

Thursday, May 4, 2017   (0 Comments)
Posted by: TCAA Staff
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Today, the House of Representatives passed the American Health Care Act, which overhauls Obamacare, by a vote of 217 to 213. 


The underlying bill would:

  • Phase out the ACA’s Medicaid expansion;
  • Impose a per capita cap on Medicaid going forward;
  • Eliminate the ACA’s Prevention and Public Health Fund;
  • Defund Planned Parenthood;
  • Repeal the ACA’s cost sharing reduction payments;
  • Create a $115 billion Patient and State Stability Fund for states to use for reinsurance and maternity coverage and newborn care, as well as mental health and substance abuse disorder treatment.
  • Repeal the ACA’s individual and employer mandate penalties;
  • Create a penalty for individuals who try to enroll in coverage who have not had continuous coverage;
  • Repeal the ACA’s actuarial value metal level requirements;
  • Change the ACA’s age rating ratios from three-to-one to five-to-one;
  • Amend the ACA’s current premium tax credits to allow them to be used for off-marketplace plans and to change the tax credit formula to make it more favorable to younger enrollees;
  • Create new fixed-dollar, age adjusted tax credits for after 2020; and,
  • Liberalize some requirements pertaining to health savings accounts.
  • Beginning in 2018, states will determine essential health benefits. There are currently 10 federal ones under Obamacare, which apply to the individual and small group markets.
  • The repeal of the Medicare payroll tax on high earners would be delayed until 2023.

The Republicans were able to garner enough support for the bill because of two amendments that were included in the final version.  The first, sponsored by Rep. Tom MacArthur from New Jersey, would allow States to submit  waiver applications to CMS, for the plan year starting January 1, 2018, to:


  • Opt out of the Affordable Care Act’s regulations on essential health benefits and community rating requirements; but not of the prohibition regarding denying coverage due to pre-existing conditions.
  • Establish high-risk pools or reinsurance programs to offset high-cost beneficiaries.
  • To receive a waiver states must ensure that their plan meets at least one of the following criteria: 
    • Reducing average premiums for health insurance coverage in the State.
    • Increasing enrollment in health insurance coverage in the State.
    • Stabilizing the market for health insurance coverage in the State.
    • Stabilizing premiums for individuals with pre-existing conditions.
    • Increasing the choice of health plans in the State.
  • Waivers would be approved by default unless the Secretary of Health and Human Services rejects requestswithin 60 days
  • Waivers can be approved for up to 10 years.

These provisions would amend the AHCA while keeping in place the bill’s other components that would replace the ACA with a system of insurance premium tax credits and a redesign of the Medicaid program.


The second amendment, sponsored by Rep. Fred Upton from Michigan, would provide $8 billion over five years to provide "assistance to reduce premiums or other out-of-pocket costs" for people with pre-existing conditions who would be charged higher premiums in states that get waivers from ACA pricing rules.


From here, the bill will proceed to the Senate, where its outlook is much more uncertain.  The Senate Finance Committee, which has sole jurisdiction over the bill, typically operates in bipartisan fashion and does not appear to be in any rush to begin working on this issue.  Senate Majority Leader Mitch McConnell has made it clear the legislation will need to change in the Senate so it can pass, though he declined to predict what the final product will look like or guarantee ultimate success.


Our team of lobbyists at Winning Strategies Washington will continue to keep you apprised in real time as the bill is debated in the Senate and to ensure the TCAA agenda receives all due consideration.

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