House of Representatives passes high risk insurance plan

This column first appeared in the San Antonio Express News on May 5, 2017.

2017-05-05Dear Mr. Premack: I tried to read the bill the House of Representatives passed to repeal of the Affordable Care Act (Obamacare) at the congress.gov website, but I cannot understand the wording (like in section 1902 in subsection (a)(47)(B), insert “and provided that any such election shall cease to be effective on January 1, 2020”). I know the Senate says it won’t go along, but what did the House bill try to do? – R.G.

The House passed H.R. 1628, the American Health Care Act of 2017, on May 4 and sent the bill to the Senate. Various Republican Senators have said that they find the bill to be unacceptable, that they will propose something different, and that they will not be in a rush. Hence, H.R. 1628 is likely to be stopped or significantly changed by the Senate.

You said that you tried to actually read H.R. 1628. The bill, like many complex proposals, has lots of cross-references to existing statutes it would amend. A reader must have access to the bill and to all of the existing statutes in order to determine exactly what is being altered, and even then, judging the impact of those changes is daunting.

The National Academy of Elder Law Attorneys, of which I am a long-time member, has published its expert analysis of H.R. 1628. Based on that analysis and my reading of some components of the bill:

  • Health insurance would no longer be mandatory. Companies that provide coverage to employees would be allowed to drop that coverage. However, if an individual policyholder drops coverage then waits longer than 63 days to obtain a new policy, the new insurance policy can charge a 30% higher premium than the prior policy for the first year.
  • The bill would allow insurance companies to charge policy holders age 50-64 up to 5 times higher premiums than those paid by younger policy holders. The Congressional Budget Office predicts that premiums for low-income seniors could rise by as much as 759 percent. This could result in many people age 50-64, who are too young for Medicare, being unable to afford to continue to buy health insurance. The bill would include a tax credit to help pay for health insurance, but it would be available only to those earning less than $75,000 per year.
  • If a state requests it, people with pre-existing conditions would be required to pay higher premiums and would have a reduced set of covered benefits. In waiver states, insurers could reduce covered benefits for everyone, by imposing lifetime limits on coverage and eliminating essential medical care (like prescription drug coverage) that is now mandated in the ACA. Those states would be required to have a high-risk insurance pool (Texas had such a pool for many years, but it was very limited).
  • Members of Congress would be exempt from the changes, and would still have all the benefits provided under the ACA. There was discussion of dropping this from the bill, but it was not dropped and remains part of H.R. 1628.
  • Medicaid would be completely restructured. States would receive block grants starting in 2020. I wrote about the impact of block grants in my column on February 14.

Paul Premack is a Certified Elder Law Attorney with offices in San Antonio and Seattle, handling Wills and Trusts, Probate, and Business Entity issues. View past legal columns or submit free questions on legal issues via www.TexasEstateandProbate.com or www.Premack.com.

One thought on “House of Representatives passes high risk insurance plan

  1. As always, it all depends on whose ox is being gored. As a senior with health care needs, I may loath the changes the House bill offers. On the other hand, if I was 25 and healthy I might be very happy that I am not mandated to have insurance that was premised on the idea that young people get to pay for–and old people consume–medical care in the system. Or that, as ACA architect Gruber so indelicately revealed, Obamacare was designed to be unintelligible as to its financial impact, helped along in passage by Americans’ stupidity…Gruber’s description, not mine.

    Just as with Mr. Premack’s earlier column on possible reversion to block grants from current Medicare federal guidelines, what one person may view as heartless Republican greed in reducing benefits another person may see as a genuine attempt to rein in out of control spending for care that families–and not anonymous taxpayers–should have primary responsibility for. Most of the people I’ve talked to who benefit from ACA really don’t care who pays the bill as long as its not them. Those being handed the bill naturally have a very different perspective.

    If anyone says we could afford to have top notch care for all if we wound down our military adventurism disguised as a foreign policy by both Republican and Democrat administrations for decades, I would say Bravo! We now have a point upon which we can agree. Bring the troops home and let’s take care of our own seniors and ill without bankrupting our young, healthy people in the process.

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