American Health Care Act Unveiled…What Does it Mean for Obamacare?

Yes, it’s true, the House Ways and Means Committee has released their portion of the Affordable Care Act “repeal and replace” bill. Already, this is generating a lot of churn and discussion in the media regarding individual and employer mandate reporting requirements for 2017.

This is where we advise everyone to pause, and take a breath.

In previous blogs, we’ve advised our readers to take into consideration the scope and complexity of “repeal and replace”. This is a large project clouded by heavy opinions that transcend party lines.

Benefits Pro reported on the proposed legislation, stating “It’s not clear whether the proposal can win the support of House conservatives of clear the Senate—where Republicans hold a thin majority and are relying on a fast-track legislative procedure full of limitations.”

Point being, all signs continue to suggest that “repeal and replace” is going to be a long process.

What are the highlights of the American Health Care Act?

At a quick glance, here are some of the highlights from the Republican proposed Obamacare replacement:

• No longer would individuals be required to have coverage
• Income-based subsidies would be replaced by age-banded tax credits
• Expand the annual limits of Health Savings Account (HSA) contributions
• Defer the “Cadillac Tax” until 2025
• A slowing of Medicaid expansion
• Individual Mandate and Employer Mandate retroactively repealed

That last bullet is sure to make employers stand up and do a backflip, but proposed legislation is a far cry from immediate repeal. While conservatives clamor for the latter, moderate members of the House and Senate are concerned that sudden changes to the healthcare milieu would have a ripple-effect of negative consequences, especially for low-income families.

Income would still have an impact on tax-credits available to individual citizens. Those making more than $75,000 per year, or who have a combined family income of $150,000 per year won’t be eligible for tax credits.

EBN criticizes, understandably so, that by eradicating the taxes and penalties associated with the individual and employer mandates, the Act will only fuel the deficit. Afterall, the money for tax credits has to come from somewhere.

President Trump himself seems to see the proposed legislation as a stepping off point for future discussion, stating that the Healthcare Bill is out for review and negotiation.

All in all, this is only the beginning of what will likely be a long discussion on “repeal and replace.” It took seven years to put the Affordable Care Act into place. It very possibly could take another seven to repeal and replace.