Healthcare Changes — Updates

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There were some ideas floated yesterday by GOP Congressional leadership, but nothing definite.  While Paul Ryan is expressing optimism that there will be a concrete proposal by17456_1269532813224_1076952025_30803996_7657050_n the end of February, others in the GOP are saying that it won’t happen “overnight” or are waiting for cost estimates from the Congressional Budget Office (CBO).

 

The ideas being discussed include:

  • Paying for repeal of the Affordable Care Act by levying a tax on healthcare insurance offered by employers.  Some versions of this proposal would limit the tax to higher end plans (gold, platinum or concierge plans), but that would go against Trump’s stated intention of giving tax breaks to the wealthy.
  • Subsidies for healthcare would be eliminated, and replaced by tax credits for people who don’t have employer provided care.
  • Elimination of some business taxes used to support the Affordable Care Act.
  • Expansion of Medicaid to more of the poor would be withdrawn.  Federal funding for expansion of Medicaid benefits would be eliminated.
  • Penalties for not having insurance will be eliminated.

The withdrawal of subsidies and removal of penalties will drive up the cost of health insurance for individuals who need insurance.  You should expect increases for 2018 that may be in the range of 20% or higher.

Removal of subsidies (for most people, an advance on a tax credit) means that more people will not be able to afford health insurance.  However, some in the GOP would prepay these tax credits — basically keeping much of the current system under a different name.

But Kenneth E. Raske, the president of the Greater New York Hospital Association, expressed alarm, saying the proposals would “put a huge amount of pressure on state budgets and put many Americans at risk of losing health care coverage.”(3)

The Medicaid change might be the most important of all of these provisions.  Many middle class Americans depend on Medicaid now to pay for nursing home care when that time comes.  At a national average of more than $92,000 per year, most people don’t have the savings to cover that.  The proposed revisions would “put Medicaid on a budget” and allow states to eliminate payments to nursing homes.

Of course, if the cost of ACA repeal is too high, none of this may go anywhere.

So the next step is to see what the CBO projections are.  We wait.


Sources:

  1. Alan Fram, “GOP leaders unveil new health law outline, divisions remain,” Associated Press, 17 February 2017.  https://www.yahoo.com/finance/news/house-gop-batting-around-options-080740612.html
  2. Ana Radelat, “GOP gives House members proposal to repeal, replace the ACA,” The Connecticut Mirror, 16 February 2017.  http://ctmirror.org/2017/02/16/gop-gives-house-members-proposal-to-repeal-replace-the-aca/
  3. Robert Pear and Thomas Kaplan, “House G.O.P. Leaders Outline Plan to Replace Obama Health Care Act,” The New York Times, 16 February 2017.
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