Sep 20 2017

Latest Proposed Health Care Repeal Empowers States

In an effort to repeal the Affordable Care Act, Senators Lindsey Graham (SC) and Bill Cassidy (LA) have released a plan that would essentially allow states to come up with their own health care plans using a federal block grant.

The grant money would replace federal dollars currently funding Medicaid expansion and subsidies on health plans and woule be set to expire in 2027.

The new bill would also make structural changes to the Medicaid program for beneficiaries who qualified before the expansion by converting it from an open-ended federal health care program to one that caps federal spending on each beneficiary.

How the bill would alter major parts of Obamacare

Medicaid expansion Taxes created under Obamacare Dependent coverage until 26
Subsidies for out-of-pocket costs Essential health benefits
Tax credits for premiums Prohibitions on annual and lifetime limits
Individual mandate Pre-existing conditions policy
Employer mandate Restrictions on charging more for older Americans
Health savings account

Medicaid expansion

OBAMACARE Changed Medicaid’s eligibility requirements to allow more people to enroll if a state chose to expand the program. The federal government pays at least 90 percent of the costs for newly eligible beneficiaries.

SENATE BILL The Cassidy-Graham bill would repeal Medicaid expansion. And instead it would create a big block of money for health coverage that states could use as they saw fit. The money would be used for residents who are currently eligible for the Medicaid expansion or the Affordable Care Act markets.

Money would be redistributed among states, using a complex formula, and the funding would expire entirely in 2027. Over all, states that expanded Medicaid would receive less money than they would under the Affordable Care Act.

Subsidies for out-of-pocket costs

OBAMACARE Provides subsidies to help people with lower incomes pay for out-of-pocket costs like deductibles and co-payments.

SENATE BILL Would repeal the subsidies in 2020. States could use money from their block grants to lower cost-sharing for low-income beneficiaries, but they would not be required to do so.

Tax credits for premiums

OBAMACARE Gives tax credits to middle-income Americans to offset the cost of premiums, based on their income and the cost of insurance in their area.

SENATE BILL Would repeal premium tax credits in 2020. But states could use the new block grant money to create their own subsidy programs.

Taxes created under the Affordable Care Act

OBAMACARE Imposed new taxes to help pay for expanding coverage to more people. They include taxes on investment income, wages above $200,000, medical devices, prescription drugs and indoor tanning.

SENATE BILL The measure would repeal the tax on medical devices but leave most other Obamacare taxes in place.