10 Things Trumpcare Would Change in Healthcare

1: ELIMINATES THE INDIVIDUAL MANDATE

Obamacare requires every American to obtain health insurance, or pay a penalty. Trumpcare allows people to not purchase health insurance if they choose. However, there’s a financial incentive to encourage individuals to maintain health insurance coverage: Insurers will be allowed to charge a 30% penalty on those who buy insurance after having a gap in coverage of more than 63 days.

2: REPLACES OBAMACARE PREMIUM SUBSIDIES WITH TAX CREDITS

All of the Obamacare subsides for helping some individuals pay for health insurance will go away. These subsidies will be replaced by tax credits for anyone who is not covered by their employer, or through a government program. The tax credits will range from $2,000 to $14,000 based on age – with families receiving higher credits than individuals. The credits will be reduced for individuals making over $75,000 annually and for families making over $150,000 annually.

3: ALLOWS STATES TO OBTAIN WAIVERS TO CHANGE “ESSENTIAL” HEALTH BENEFITS

Obamacare imposes federally-established minimum benefits that all health insurance policies have to offer. Trumpcare will allow states to apply for waivers allowing them to change these minimum benefits for purposes such as reducing healthcare coverage costs and increasing the number of people with healthcare coverage.

4: ALLOWS STATES TO OBTAIN WAIVERS TO ALLOW INSURERS TO CHARGE MORE FOR PREEXISTING CONDITIONS

Under Obamacare, health insurers are prohibited from charging higher premiums for individuals with pre-existing conditions. Trumpcare would allow states to obtain waivers allowing insurers to charge more for people with pre-existing conditions. However, the higher charges would only apply to individuals with pre-existing conditions who have a gap in coverage.

5: PROVIDES SUBSIDIES FOR SOME WITH PRE-EXISTING CONDITIONS

Trumpcare would provide $8 billion specifically for states that obtained the waiver mentioned in the previous point to provide subsidies to individuals with pre-existing conditions who do not maintain continuous coverage. The legislation also provides $130 billion that states could use for this purpose, or for expanding coverage and reducing costs in other ways.

6: ALLOWS INSURERS TO CHARGE OLDER ADULTS UP TO FIVE TIMES THE RATES CHARGED FOR YOUNGER ADULTS

Obamacare limited insurers to charging older adults a maximum of three times the rates charged to younger adults. Trumpcare will raise the ratio limit to five times that charged to younger adults.

7: ROLLS BACK OBAMACARE MEDICAID EXPANSION

Obamacare provided funds for states to expand Medicaid. Trumpcare will repeal this expansion. States will receive a set amount per beneficiary from the federal government, or if they choose, a lump-sum block grant.

8: ALLOWS STATES TO IMPLEMENT A MEDICAID WORK REQUIREMENT

Trumpcare will allow states that choose to do so to require “able-bodied” Medicaid recipients to either work, participate in job-training programs, or help with community service.

9: EXPANDS HEALTHCARE SAVINGS ACCOUNTS

Currently, the maximum annual health savings account (HSA) contribution is $3,400 for individuals and $6,750 for families. Trumpcare would increase the maximums to $6,550 for individuals and $13,100 for families beginning in 2018.

10: REPEALS OBAMACARE CONSUMER TAXES

Obamacare includes a laundry list of taxes, such as a tax on some health insurance plans, a tax on certain prescription drugs, a tax on indoor tanning services, a medical device tax, and capital gains, dividend, and interest income taxes for higher-income wage earners. Trumpcare eliminates all of these taxes.

SUMMARY AS OF JUNE 28, 2017

The Affordable Care Act (ACA) remains the law for now. The House has passed the American Healthcare Act (AHCA) which replaces the ACA, and the legislation has gone to the Senate for deliberation where it currently sits. On Tuesday, June 27, Senator Mitch McConnell, the Republican majority leader, delayed voting on the AHCA until after the July 4 recess. This delay is due to an attempt to get more support from reluctant Republican senators. Every Democrat senator is expected to oppose the bill, which means that three Republican “no” votes would block it. The bill needs at least fifty votes to pass (Vice President Mike Pence could cast a tiebreaking vote). If it is passed by the Senate, the AHCA bill would go to President Trump for signature.

In all likelihood, the Senate will make its own changes. If that happens, the bill would go to a conference committee consisting of senators and representatives who hopefully would work out the differences. Both the Senate and the House of Representatives would have to vote on the final compromise bill. If passed by both houses of Congress, the bill would then go to President Trump for his signature. The likelihood of Trumpcare replacing Obamacare now appears to be much higher than in recent weeks.