American Health Care Act News: Pre-existing Conditions and More Obamacare Features Stay but With Changes
House Republicans have provided details on their replacement plan for the American Health Care Act set to repeal Obamacare, albeit keeping some of its key aspects.
For starters, it will still cover people with pre-existing conditions and will allow children up to age 26 to stay on the plans of their parents, but it will charge higher premiums to people who fail to maintain coverage.
Those who let their individual health plan lapse will have to pay 30 percent surcharge on their premiums during the year to be able to resume coverage.
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Under Obamacare, tax credits are used to lower the premiums for majority of enrollees, the value of which depends on their income and cost of coverage.
Vox says that the replacement plan practically benefits people who are healthy and high-income and will prove challenging and costly to the older and sicker Obamacare enrollees.
Unlike the Obamacare, which aims to give more help to those with lower income, the GOP plan will give full value of tax credits to those who earn up to $75,000 or $150,000 in a household. That value phases out in 10 percent increments for people who earn more than the abovementioned amount.
As a result, insurers will be able to charge older people premiums five times the amount charged to younger people, who get cheaper premiums and easier ability to enroll.
RAND Corporation economist Christine Eibner says that the premiums could go up to $8,500 to $10,600 for a 60-year-old employee, but only around $2,800 to $3,100 for a 24-year-old.
Although earlier drafts of the replacement plan called for its abolishment, the Medicaid expansion used on Obamacare also stays, but only temporarily.
The replacement plan will keep this feature, at least up to Jan. 1, 2020. Before this date, states can enroll people and give states that did not expand yet to do so.
After that, enrollment will "freeze." According to Vox, this could encourage other states that still have not expanded to participate.
The Medicaid expansion is what allowed Obamacare to provide insurance to millions of people, especially the lower-income Americans. It covered people below 138 percent of the poverty line across the 31 states that took part.
Although the Medicaid expansion is staying, American Health Care Act also introduces a significant change in it. The GO Plan will see states receive a set amount of money from the federal government.
This is a major modification, seeing that under Obamacare, it is the federal government who settles the bills of a Medicaid enrollee at any rate.
This change is expected to lead to many people losing access to health insurance they have enjoyed in Obamacare as it is slated to reduce the Medicaid funding significantly.
The Congressional Budget Office is yet to score the American Health Care Act so its price remains unknown at the moment.
