Another Day, Another “Plan”
Last year, long-time ACA critics Sens. Orrin Hatch of Utah, Richard Burr of North Carolina and former Sen. Tom Coburn released a concept paper on replacing the ACA that failed to garner the support of the GOP at large. This week they (along with Rep. Upton from Michigan) re-released a description of the “Patient CARE ACT” (although there is no actual legislative language) with a few policy tweaks. The release feels timed to influence the Supreme Court prior to their hearing King v. Burwell rather than a realistic plan for the future. While the tides have changed in Congress since the last time this proposal surfaced, the fact remains that the prospects for such a radical rewrite of the ACA are nil. In fact it is far from clear that legislation based on the outline could even command support from a majority of the Republican caucus, let alone pass Congress. It is not even clear that legislation based on the proposal will ever be drafted.
However, if ideas from this proposal do eventually make their way into a replacement plan that gains legislative traction, here are three of our biggest concerns:
1. Approximately 10 million newly insured consumers could lose their current coverage.
The proposal would repeal the ACA entirely, except for the changes made to the Medicare program. However, there is no mention of how they will transition the millions of Americans who recently gained coverage thanks to the ACA. This means uncertainty and plan cancellations for the many consumers who finally have peace of mind knowing they have health insurance coverage they can rely on.
Low-income childless adults who are currently benefiting from the ACA’s Medicaid expansion (many having access to coverage for the first time) in 29 states will be displaced to the individual market. The proposal seeks to use block grants for states to cover pregnant women, children, and low-income families. This funding mechanism would shift significant costs to the states, which would likely result in cuts in benefits, eligibility, and provider payments. Also, federal dollars to help states cover low-income childless adults would disappear and subject this vulnerable population to individual market coverage they are unlikely able to afford.
2. Shifting costs to consumers is not the answer.
The proposal leaves many questions unanswered, but the increased cost burden on consumers is perfectly clear. While the proposal retains the use of subsidies for consumers purchasing private insurance, it relies on a fixed amount tied to an individual’s age with no regard for the actual cost of coverage. Because the credit is not adjusted for income, many lower income households will still find coverage unaffordable Additionally, the proposal lowers the income eligibility threshold for subsidies and appears to eliminate the ACA’s cost sharing reductions leaving consumers on the hook with no help for costly deductibles, co-payments and co-insurance.
To make matters worse, this increase in premiums and cost sharing would be coupled with a decrease in covered benefits. The proposal repeals the ACA’s essential health benefits and offers no solution for guaranteeing access to comprehensive benefits, which will likely leave many low and moderately-income people without access to needed care and still more out-of-pocket costs.
3. Say goodbye to crucial consumer protections.
Under this proposal the progress the ACA made in protecting consumers from long-standing discriminatory insurance practices would disappear.
- Individuals with pre-existing conditions could be denied coverage or charged significantly more based on health status if they are unable to keep “continuous coverage” or don’t participate in a designated one-time-only open enrollment period.
- Insurers can once again charge women higher premiums than men in the individual market.
- Insurers can charge older people five times what they charge younger people for the same plan.
- Even the skimpy protections offered by this plan, such as allowing young adults up to age 26 to be covered on their parents’ plan, could be nullified by individual states.
There is certainly more that we could say about problematic policies in this proposal. For more details, see The Center on Budget and Policy Priorities analysis of this proposal.
So what does this proposal mean for advocates working tirelessly to enroll consumers in coverage during the final days of open enrollment? For now, in the musical words of one wise pop-star, “I shake it off – I shake it off”!