As you likely already know, the Senate Republicans have just released their health care proposal –the Better Care Reconciliation Act of 2017 (BCRA). A vote is expected next week. We asked our Public Policy Team to break this one down, just like they did for the bill passed by the House in early May. Once again, here’s the non-partisan read of the bill.
Subsidies & Mandates:
The Senate proposal maintains the premium subsidy structure of the Affordable Care Act (ACA) through 2019. In 2020, eligibility for subsidies is capped at 350% of the Federal Poverty Level (FPL), down from the current 400% cap.
The plan also extends eligibility down to 0% of FPL (current law is 138%), allowing very low-income people in non-Medicaid-expansion states to receive a subsidy. The benchmark used to calculate subsidies is the average cost of a 58% Actuarial Value plan (roughly bronze-level). The existing benchmark is the second-lowest silver plan in the market.
The BCRA amends the provisions for Section 1332 waivers. Under the ACA, states may pursue these waivers if they can prove that they will use the federally-funded subsidies available to their citizens in the exchange to provide coverage that is at least as comprehensive as that required in the exchange and covers a comparable number of people. Under the GOP plan, the only condition states must meet is that their waiver will not increase the federal deficit. The bill provides $2 billion in federal support for states using 1332 waivers through 2019 and establishes that waivers may be issued for as long as eight years.
The Senate proposal repeals mandates for individual and employer coverage as well as the tax credit given to small businesses offering coverage.
It funds cost-sharing subsidies through 2019, then ends the program.
The proposal increases the age-rating band from 3:1 to 5:1. Easily explained, under current law, plans may only charge older (and presumably sicker) people three times the amount they charge younger (and presumably healthier) members. Now, they may charge the older members up to five times the amount of their least expensive premium.
The BCRA repeals major Affordable Care Act (ACA) taxes, including those on medical device manufacturers, prescription drug makers, health plans and certain investment gains.
Essential Health Benefits (EHB):
The proposal maintains the ban on charging more for pre-existing conditions and ability for children to stay on their parents’ plans through the age of 26, while eliminating essential health benefit requirements as of 2020.
The BCRA provides $50 billion to states for market stabilization (reinsurance mechanisms) in the immediate term and broader market stabilization efforts in longer term. An additional $62 billion would be available in state grants through 2026. The idea is to “encourage states to assist high-cost and low-income individuals to purchase health insurance by making it more affordable.”
The bill maintains the higher matching rate for ACA expansion populations in Medicaid until 2021. The rates are phased down from 2021-2023, at which point a state’s standard matching rate applies.
Medicaid transitions to a per capita cap beginning in 2020, with disabled children excluded from cap provisions. The baseline cap figure would be set based on any eight consecutive quarters from Q1, 2014 to Q2, 2017, as chosen by the state. The Medicaid spending growth rate under per capita caps is the same as the House bill (CPI-Medical) until 2025, then switches to the general inflation rate going forward.
Beginning in 2020, states also have the option to use block grants through a new Medicaid Flexibility Program, which allows them to provide targeted benefits to enrollees. They will be required to report CAHPS and adult health quality measures. The bill also offers $8 million in Medicaid and CHIP Quality Performance Bonus Payments to states with equal or lower than expected expenditures for years 2023 through 2026.
Reproductive Health/Planned Parenthood:
Planned Parenthood is excluded from the Medicaid program for 2018.
The Senate proposal, like it’s House counterpart, likely faces broad opposition from the health care sector and from disease-specific and consumer groups. It’s expected to reach the Senate floor for deliberations next week.
Although it can pass the Senate with a simple majority because of the special rules for reconciliation, Republicans hold only a two-seat majority. This means they can afford no more than three dissenters, presuming Vice President Mike Pence would break a 50:50 tie.
If they do pass the proposal, it would go back to the House for another vote, or it could go to a conference committee where members of the House and Senate could try to formulate a compromise proposal between their respective versions of health care proposals.
That’s your update from the Hill and from the NCQA Public Policy Team! Stay tuned for further developments.
Matt Brock is the Director of Communications at NCQA. After more than two decades working in broadcast journalism, Matt now leads NCQA’s efforts to develop unique content that engages and informs consumers as well as providers, plans and policymakers via this blog, our website, NCQA.org and numerous social media platforms. Matt’s goal is to educate consumers and to direct them to the best resources when considering quality in their health care decisions.