House Passes American Health Care Act Repealing Obamacare

The House passed a bill, HR 1628, to repeal and replace the Affordable Care Act (“Obamacare”) on Thursday by a vote close vote of 217 to 213. Twenty Republicans and all 193 Democrats voted against the measure. Rep. Dan Newhouse (R-WA) did not vote as he is attending to his wife while she battles cancer.

The American Health Care Act (AHCA) would repeal most of the subsidies and penalties imposed under Obamacare thereby removing the mandate for Americans to obtain health insurance. The AHCA does the following:

  • Replaces the individual mandate with allowing insurers to charge a 30% premium surcharge on people who have been uninsured for about two months.
  • Eliminates Obamacare taxes that were used to fund the law – a 3.8% investment tax on people earning more than $250,000, a 0.9% surcharge on individuals in the same high-income bracket, and taxes on health insurers, medical device manufacturers, drug manufacturers, and tanning bed salons.
  • Cuts Medicaid spending by $880B over 10 years.
  • Defunds Planned Parenthood and other abortion providers for one year by blocking Medicaid reimbursement. The bill also includes a measure that would prohibit federal tax credits from being used to pay for insurance that covers abortion services.
  • Allows insurers to charge older Americans up to five times as much as it does a 21-year old, this is up from the three times as much limit imposed by Obamacare.
  • Allows states to opt out of the essential health benefits required by Obamacare. More specifically, insurers could charge sick patients more for coverage if the state sets up high-risk pools so that people with pre-existing conditions would have access to coverage. The bill provides states with an additional $8B in funding to set up the high-risk pools. It is unclear how many states will choose to opt out of the essential benefits if the bill is signed into law.
  • Allows large employers to choose the benefits available in a state that sought a waiver from the ACA’s benefit requirements as they aren’t bound by the benefits mandated by their state. Employers looking to lower their costs could choose a state that would allow them to impose lifetime limits and eliminate the out-of-pocket cost cap from their plans.

The House also passed a separate bill (HR 2192) that would remove a provision regarding exemptions for members of Congress and their staff from state waivers.

The twenty Republicans voting against the AHCA in the house were: Reps. Andy Biggs (Ariz.), Mike Coffman (Colo.), Barbara Comstock (Va.), Ryan Costello (Pa.), Charlie Dent (Pa.), Dan Donovan (N.Y.), Brian Fitzpatrick (Pa.), Jaime Herrera Beutler (Wa.), Will Hurd (Tx.), Walter Jones (N.C.), David Joyce (Ohio), John Katko (N.Y.), Leonard Lance (N.J.), Frank LoBiondo (N.J.), Thomas Massie (Ky.), Pat Meehan (Pa.), Dave Reichert (Wa.), Ileana Ros-Lehtinen (Fla.), Chris Smith (N.J.) and Mike Turner (Ohio). Coffman, Lance, Reichert, and Turner changed their votes from what was expected last time. Nine of these members are in congressional districts that voted for Hillary Clinton in November. They are all likely to be targeted by Democrats in 2018.

The bill now heads to the Senate where Republicans hold a majority with 52 seats where we can expect to see a much slower pace. They can’t afford to lose more than two Senators to get the bill passed. Vice President Mike Pence would cast the deciding vote in a 50-50 tie.

Senate Majority Leader Mitch McConnell (R-KY) has convened a working group that includes members of his leadership team, moderates concerned about the Medicaid rollback, conservatives who are interested in states’ rights, and two key committee chairmen – Senate Finance Committee Chairman Orrin Hatch (R-UT) and Senate Health, Education, Labor, and Pensions Committee Chairman Lamar Alexander (R-TN) – to work out a compromise. McConnell had originally planned to bring the House bill directly to the Senate floor, but now wants to vet it through the working group to ensure that they have the votes necessary for passage. Bypassing the committees has been a concern to some Senate Republicans who would prefer that they hold hearings and pursue repeal and replace through regular order. Other Senators are insisting on a cost estimate and analysis from the Congressional Budget Office before voting on their bill.

The more deliberative pace in the Senate could have an effect on the FY18 appropriations process. Congress may delay passing an FY18 budget resolution that would set spending limits until they finish the health care measure using the FY17 budget reconciliation process. It isn’t clear yet if adopting an FY18 budget resolution before the health care bill is passed risks losing the protections of reconciliation and opens a door to a potential filibuster. Rather than test the rules, Republicans may opt to put an FY18 budget resolution on the back burner until they finish health care reform.

American Health Care Act:

https://www.gpo.gov/fdsys/pkg/BILLS-115hr1628rh/pdf/BILLS-115hr1628rh.pdf

American Health Care Act Report Language:

https://www.gpo.gov/fdsys/pkg/CRPT-115hrpt52/pdf/CRPT-115hrpt52.pdf

Amendment #32 Reps. Gary Palmer (R-LA) and David Schweikert (R-AZ)

The amendment creates a $15 billion risk sharing program to help states lower premiums for health coverage offered in the individual market.

Amendment: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/AHCA/Palmer-Schweikert%20Amendment.pdf

Section-by-Section: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/AHCA/Section-by-Section.pdf

Amendment #33 Rep. Thomas MacArthur (R-NJ)

The amendment allows states to waive essential health benefits, age rating, and community rating. Health insurers would not be allowed to [deny coverage,] discriminate based on gender or [limit access based on] preexisting conditions. States must explain how the waiver will reduce average premiums for patients, increase enrollment for residents, stabilize the state’s health insurance market, stabilize premiums for individuals living with preexisting conditions, or increase patients’ health care plan options.

Amendment: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/OMNI/MacArthur%20Amendment.pdf

Section-by-Section: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/OMNI/MacArthur%20Amendment%20Summary.pdf

Amendment #34 Rep. Fred Upton (R-MI)

The amendment increases the Patient and State Stability Fund by $8 billion from 2018 to 2023 to States with an approved community rating waiver, as established by the MacArthur Amendment, for providing assistance to reduce premiums or other out-of-pocket costs to individuals who may who may be subject to an increase in their monthly premium rates as a result of the States waiver. The amendment also resolves two minor technical drafting amendments, including the correction of an inaccurate cross-reference and to ensure proper labeling of subsections.

Amendment: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/OMNI/Upton%20Amendment.pdf

Section-by-Section: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/OMNI/Upton%20Section-by-Section.pdf

Amendment #4 Reps. Greg Walden (R-OR) and Kevin Brady (R-TX)

This amendment makes technical changes to conform with reconciliation instructions and address other drafting issues.

Amendment: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/tech_mngr_01.pdf

Section-by-Section: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/115-AHCA-SxS-MNGR-Tech.pdf

Amendment #24 Reps. Greg Walden (R-OR) and Kevin Brady (R-TX)

This amendment makes technical changes to address drafting issues.

Amendment: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/TECH-AMDT-TO-AMDT.pdf

Section-by-Section: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/TECH-SxS%20for%20AMENDMENT%20to%20Manager%27s%20Amendment.pdf

Amendment #5 Reps. Greg Walden (R-OR) and Kevin Brady (R-TX)

This amendment provides for the inclusion of additional policies affecting both Medicaid and the tax code.
Amendment: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/policy_mngr_01.pdf

Section-by-Section: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/115-AHCA-SxS-MNGR-Policy.pdf

Amendment #25 Rep. Greg Walden (R-OR)

This amendment makes technical changes to address drafting issues.
Amendment: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/POLICY-AMDT-TO-AMDT.pdf

Section-by-Section: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/POLICY-SxS%20for%20AMENDMENT%20to%20Manager%27s%20Amendment.pdf

Amendment #31 Rep. Greg Walden (R-OR) and Kevin Brady (R-TX)

This amendment delays the repeal of the additional .9 percent Medicare tax on high-income earners, require states to establish their own essential health benefits standards for purposes of the premium tax credit, and provide additional funding for the Patient and State Stability Fund for mental health and substance use disorders and maternity care.

Amendment: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/policymngr-amdt.pdf

Section-by-Section: https://rules.house.gov/sites/republicans.rules.house.gov/files/115/115-AHCA-SxS-Policy2ndDegree.pdf

Congressional Research Service Report on the AHCA:

https://fas.org/sgp/crs/misc/R44785.pdf

 

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