The Senate’s New Health Care Bill is Still a Mess
Health Care Reporter, ThinkProgress
The new Senate health bill was released on Thursday, but it still looks set to deprive millions of health care coverage. It’s even still called the Better Care Reconciliation Act.
The new bill does not change the main issues with Senate Republicans’ earlier health care bill: the Better Care Reconciliation Act (BCRA), one of the most unpopular bill in the three decades. The new bill still ends Obamacare’s expansion of Medicaid to low-income adults and ultimately caps funding to the program. The bill also still restructures tax credits in a way that are less generous and increases premiums and deductibles for moderate-to-low-income adults looking to buy non-group insurance, or insurance not bought through an employer or corporation. And it weakens consumer protections if patients do decide to buy non-group insurance, by granting states leeway to allow insurance companies to opt-out of the Obamacare’s essential benefits rule.
Perhaps the most controversial change in the flailing revival bill is a modified version of an idea from Sens. Ted Cruz (R-TX) and Mike Lee (R-UT). The bill sets up a fund to help cover people with high medical costs (for people reading along, this begins on page 161 of the bill and dubbed “Consumer Protection”). To access this money, insurance companies need to offer at least one Obamacare-compliant plan and at that point, it can offer non-compliant Obamacare plans, as explained by the Washington Examiner.
Major players in the industry and consumer groups have already come out against the provision after the idea was leaked two weeks ago by Vox. America’s Health Insurance Plans, the biggest insurance name in the health game, said in a statement that “including both ‘compliant’ and ‘non-compliant’ plans in a single risk pool would be infeasible and not solve the problems of an unlevel playing field.”
In a scenario like this, sick people would find themselves on expensive insurance plans because healthy people would look to buy cheaper non-Obamacare plans. The imbalance would quickly lead to a death spiral, a loop where healthy people leaving the market drives up premiums to a point where eventually, the entire market collapses.
Without a strong mandate that penalizes people for not buying insurance, it’s also hard to see why patients would want to buy skimpy, expensive care. Under this Republican plan, health experts say the non-group marketplace could collapse and it’ll take Medicaid with it.
Here’s a brief summary of the other main changes to the Senate bill:
Minor Medicaid changes
The bill doesn’t address BCRA’s major cuts to Medicaid, which the Congressional Budget Office previously estimated could lead to 15 million people losing coverage by 2026.
Instead, the bill changes how Medicaid pays hospitals. Hospitals receive additional supplemental Medicaid payment in the form of Disproportionate Share Hospital Payments (DSH). Essentially, the bill changes DSH calculation from Medicaid enrollee to per uninsured.
The bill also allows states to apply for waivers that will add extra federal Medicaid funding assistance if the state has declared a public health emergency.
Two Obamacare taxes on big earners are no longer repealed
- 3.8 percent tax on net investment income for people who earn more than $200,000 and couples with incomes over $250,000
- 0.9 percent Medicare surtax on people who earn more than $200,000 and couples with incomes over $250,000.
These two taxes would generate nearly $230.8 billion in revenue over the next decade, according to the recent Congressional Budget Office report. In attempt to garner moderate senators’ support, McConnell could use the extra savings to relieve costs burdens placed on Medicaid patients.
More money to curb costs for high-risk patients
The earlier BCRA provided $112 billion. The revised bill now provides an additional $70 billion to states that could be used toward reducing the non-group marketplace premiums and deductibles. The stabilization grants totals to $132 billion but states have to match to qualify.
Residents could also set up a health savings account (HSA). HSA is a type of financial account that allow people to put aside money tax free for medical expenses. HSA mostly benefit high-income taxpayers, according to the Center on Budget Policy and Priorities.
CREDIT: Center on Budget and Policy Priorities
More money to insurance companies
The bill provides $70 billion directly to insurance companies to help pay for high-cost customers. Larry Levitt, vice president of Kaiser Family Foundation, estimated that about a quarter of trillion dollars in funds go directly to insurers:
People could use tax credits to buy a high-deductible plan
A deductible is the amount patients pay for covered services before the insurance starts paying. The Affordable Care Act (ACA) called high-deductible plans catastrophic. High-deductible plans mean cheap premiums, or monthly insurance costs. Individuals could buy these plans on the marketplace, and they’d be eligible for a tax credit. ACA prohibited catastrophic plans from receiving tax credits.
$45 billion additional funds to combat opioid crisis
BCRA 1.0 gave states $2 billion in grants, but now the Department of Health and Humans Services will auction off $45 billion in grants to states to help support the nationwide substance abuse crisis.
Grants targeted to address drug abuse treatment, recovery, and pain research do not address the other host of associated physical health problems, according to public health experts the New York Times interviewed.
The revision was meant to garner support from senators who represent addition-stricken states, like Senators Shelley Moore Capito (R-WV) and Rob Portman (R-OH). The additional changes still do not address core features of the bill — that senators, health industry players, and public more broadly want revised.
Next steps
It’s hard to imagine how Senators like Dean Heller (R-NV) and Susan Collins (R-ME) vote yes for a bill that includes steep cuts to Medicaid and high-cost premium insurance — parts of the bill they’ve been so ardently against. The bill needs 50 votes for the bill to pass, using the senate procedure reconciliation.
Majority Leader Mitch McConnell (R-KY) expects a CBO score early next week on this bill and a “motion to proceed” (fancy way of saying bring the bill or measure up for Senate consideration) by midweek. BCRA 1.0 never made it to motion to proceed, after Senator Hellen said he would vote no to even begin debate.
It’s important to remember that this bill is not necessary the final bill. “These are all potential amendments to be offered to the House-passed bill, [or the American Health Care Act],” former senate parliamentarian Alan Frumin told ThinkProgress. “But until they are offered to the House-passed bill, they are just ideas, just proposals, and they have no status.” That means the senate parliamentarian, who needs to make sure the bill complies with senate rules, and lawmakers, looking to negotiate, can still technically change it.
Also on Thursday, Sens. Lindsay Graham (R-SC) and Bill Cassidy (R-LA) announced that they are working on an alternative health care plan.
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Reposted from ThinkProgress
