House passes health reform bill – three key amendments

by DLA Piper
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On May 4, 2017, Republicans in the House of Representatives succeeded in passing a health care bill. The vote was narrow: 217 (the exact number of votes needed to pass) – 213.

On March 24, 2017 Speaker Paul Ryan and House Republicans were forced to concede they did not have the votes to successfully pass the American Health Care Act (AHCA) through the House of Representatives; this was the result of the divide within the Republican party between the Freedom Caucus conservatives who felt the AHCA didn't go far enough in repealing more of Obamacare's policy provisions, and the moderates concerned with the substantial loss of insurance coverage across their various constituencies.

Since March, political Washington had all but accepted the fact that the AHCA, and the entirety of their efforts to implement sweeping policy changes to the Obamacare structure and financing, would go no further at this point than a failed attempt; until now. As a reminder, the original AHCA legislation included the following provisions:

  • Allows states to choose how they receive their Medicaid funding: (1) Medicaid per-capita caps, OR (2) block grants
  • Allows states to implement work/employment requirements for Medicaid enrollees
  • Prohibits states that have, to date, not pursued Medicaid program eligibility expansion under Obamacare, but for states that have already expanded their Medicaid program eligibility, allow those states to grandfather in beneficiaries who enroll in those existing expansion programs before December 31, 2019
  • Allows for more generous provider reimbursement for elderly and disabled Medicaid enrollees to facilitate better access to providers for this population
  • Repeal ALL of the taxes that were included in the ACA (excepting the 40 percent surcharge tax on high-cost employer health plans, also known as the "Cadillac Tax") in 2017, instead of 2018, as in the original bill
  • Delays the Cadillac tax from taking effect another year (ie the revised bill moved the effective date for that provision from 2025 to 2026)
  • Allows the Senate body to enhance the tax credit for those ages 50 to 64
  • Ensures federally funded tax credits can only be used to purchase insurance plans that do NOT cover abortions or abortion services.

This week, Republicans in the House produced three amendments to the original version of the AHCA in an attempt to appease various factions of their membership and succeed in passing the AHCA this time around. The substance of those three amendments to the legislation follows:

  1. MacArthur Amendment
    • This amendment was the first to be tossed around over the past week, and is a supplement to the original AHCA bill, which creates a Patient & State Stability Fund and does not allow health insurers to deny coverage due to pre-existing conditions, or discriminate based on age or gender.
    • This addresses some of the demands of Freedom Caucus members allowing individual states to waive some ACA provisions that the mandatory package of essential health benefits insurance plans must cover, as well as community and age rating; the goal of these three being to provide relief to consumers from the inflated cost of health insurance premiums and deductibles.
    • In order to take advantage of this waiver-type structure, states would have to examine and prove to the federal government how the waiver would ultimately give relief to their specific state in reducing and stabilizing premiums for people with pre-existing conditions; stabilize the state’s insurance market; and/or increase health insurance plan options.
  2. Upton-Long Amendment
    • This amendment is supplementary to the MacArthur Amendment above that allows states to try and obtain a waiver from certain ACA provisions if they can prove their state’s viability to implement such waiver.
    • For states that obtain a waiver, the MacArthur amendment would provide an additional bulk payment of $8 billion to the Patient & State Stability Fund created by the original AHCA legislation.
    • This additional money, combined with that in the original bill, would serve as a financial assistance tool to mitigate health insurance premium and deductible increases that may result for those with costly health conditions and/or pre-existing conditions in states that get waiver approval.
  3. Palmer/Schweikert Amendment
    • Addresses the current instability in the individual health insurance market by extending $15 billion in risk-sharing money to states to assist in lowering premium and out-of-pocket costs for the individual health insurance market.
    • The goal of this amendment is to help stabilize the most vulnerable markets across all states nationwide, which is the Individual market.

Today saw the second attempt to initiate the stepwise process of making sweeping changes to the Obamacare policies that better reflect what conservatives feel is a self-sustaining, free-market-based healthcare system.

[View source.]

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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