The Senate released its bill to repeal and replace Obamacare Thursday morning, which makes significant changes to the number of people who will recieve coverage, Obamacare subsidy payments and Obamacare’s Medicaid expansion program.
1) Who Will Be Covered Under The Senate Bill
The Senate bill allows states to end the individual and employer mandates imposed under Obamacare. Essentially, the federal government will no longer penalize Americans who choose to not purchase health insurance.
The Senate version keeps one of the most popular provisions of the Affordable Care Act. Under the Senate bill, individuals under the age of 26 would be allowed to stay on their parent’s health insurance.
The bill also keeps the Obamacare mandate that insurance companies are not allowed to deny, or increase the price of, coverage for individuals with pre-existing conditions.
The bill will strip funding for Planned Parenthood for one year.
2) Obamacare Tax Credits And Subsidy Payments
The Affordable Care Act instituted tax credits to help low-to-moderate income individuals obtain health insurance on the Obamacare state exchanges. These credits were tied to mainly to income, age and location — areas of the country that had higher risk pools.
The Senate bill does include tax credits, but the credits are only tied to income levels. The credits would allow low-income consumers to obtain insurance coverage, although the plans will include fewer benefits and treatment options. Credits will also only be available to low-income consumers, and the bar will be set lower than it was under Obamacare.
Obamacare included subsidy payments, like cost-sharing reductions (CSRs), to help individuals pay for healthcare. Specifically, these subsidies help people pay for the higher deductibles and co-payments brought on by Obamacare. (RELATED: The Potentially ‘Unconstitutional’ Feature Of Obamacare Everyone Is Ignoring)
The Senate version ends CSR payments after Dec. 31, 2019, but the president has the power to end them sooner if he chooses. Insurance companies will likely be outraged at this feature of the Senate bill, because they are slated to pay out $17 billion in CSRs through 2018.
The bill includes a $112 billion stability fund to help insurance companies cover the cost of insuring higher risk consumers.
It cuts many of the Obamacare taxes and suspends the “Cadillac” tax placed on employers through 2025.
3) Obamacare’s Medicaid Expansion Program
The Senate bill includes a 4-year phase out of the federal funding granted to the Obamacare Medicaid expansion program, starting in 2020.
The longer timeframe is Senate Majority Leader Mitch McConnell’s idea, and was devised to help bridge the divide between conservative and moderate Republicans who had drastically different policy preferences regarding the Medicaid expansion program. The bill includes steeper cuts to Medicaid starting in 2025, when Medicaid payments would begin growing at a slower rate. (RELATED: Trump To Meet With Wavering Senators On Obamacare Repeal)
Under the Senate bill, Medicaid would be funded through a block grant, starting in 2021. States will also be barred from expanding Medicaid after 2020. The states that have expanded Medicaid by the deadline will receive a smaller portion of federal funds, starting in 2021.
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