ACA Update

On July 13, 2017, the U.S. Senate released an updated version of the Better Care Reconciliation Act (BCRA), legislation to repeal large provisions of the Affordable Care Act (ACA). The changes to the bill are an effort to win support from Republican Senators still opposed to BCRA. ASH is in the process of analyzing the new legislation and will update this page to reflect the changes as soon as possible. 

On June 22, 2017, the U.S. Senate released draft legislation, the Better Care Reconciliation Act (BCRA), to repeal large provisions of the Affordable Care Act (ACA). This legislation comes two months after the American Health Care Act (AHCA), the U.S. House of Representative’s version of a repeal bill, which passed the House on May 4, 2017. There was speculation that the Senate bill would differ greatly from the House bill and provide greater protections to the most vulnerable Americans – the elderly, low-income, and those with lifelong chronic illness. However, the Senate bill does not differ significantly from the House legislation, and ASH opposes BCRA for the same reasons the Society opposed the AHCA, because of concerns that this piece of legislation will reduce overall access to coverage and treatment and would negatively impact patients with hematologic diseases and disorders.

The BCRA allows states to apply for waivers to opt out of certain ACA requirements. While the BCRA differs from the AHCA in that states cannot waive the community rating requirement, allowing insurers to charge higher prices to individuals with pre-existing conditions, the Senate bill does allow states to define the essential health benefits (EHBs), which include 10 categories of benefits such as hospital care and prescription drugs. EHBs ensure access to broad coverage, and many important patient protections in the ACA only apply to services defined as EHBs, including the elimination of annual and lifetime limits. Changes to EHBs would seriously undermine the ban on lifetime and annual caps and the annual maximum for out-of-pocket expenses. Additionally, under the ACA, if a state chose to waive a certain requirement, it had to ensure that coverage remain as generous, the same number of people are covered, and out-of-pocket costs are no higher. The BCRA removes these safeguards. 

Under the ACA, states that chose to expand the Medicaid program, received and are still receiving enhanced federal funding to assist in the coverage of a broader Medicaid population. However, under the BCRA, beginning January 1, 2020, these increased payments will begin to be phased-out and will be fully eliminated by 2024. Additionally, the Senate legislation, similar to the House bill, will convert the Medicaid program to a per capita allotment or a block grant system – leaving the choice up to the states. The AHCA adjusts each state’s targeted spending amount by the percentage increase in the medical care component of the consumer price index (CPI). However, the Senate bill uses the same inflationary adjustment as the House until 2025 but then switches to the less generous CPI for all urban consumers. These changes would make it more difficult for states to respond to fluctuations in the price and demand for health care services.

The BCRA does away with the ACA subsidies, which were adjusted by income and location, and replaces them with income-based tax credits. While this is an improvement over AHCA, which linked the tax credits solely to age, the BCRA’s tax credits are less generous than the subsidies offered through the ACA, restricting eligibility to people with incomes not exceeding 350 percent of the federal poverty level, a reduction from the 400 percent cap under the ACA. Furthermore, the Senate bill would allow states to increase the age rating ratio from 3:1 to 5:1, significantly increasing the cost of coverage for older Americans. The legislation repeals the controversial individual and employer mandates, as well as the tax provisions, which were included in the ACA to finance the Medicaid coverage expansion. The AHCA replaced the individual mandate with a provision that required individuals with a lapse in coverage longer than 63 days to pay a penalty equal to 30 percent of their insurance premium for a year. The BCRA includes a provision which would make those who had a lapse in coverage for 63 days or more wait six months before obtaining insurance. 

ASH is also concerned about the bill’s proposed elimination of the Public Health and Prevention Fund which has supported many critical projects at the Centers for Disease Control and Prevention (CDC), including investments in immunizations and health-care associated infections. Currently the Fund comprises approximately 12 percent of CDC’s budget and should be preserved.

On June 26, 2017 the Congressional Budget Office, responsible for reporting non-partisan cost estimates for proposed legislation, released a score for the BCRA. The CBO estimates that if the BCRA passes, 22 million more Americans will be uninsured over the next decade, and that the bill will cut the federal deficit by $321 billion over 10 years. The Senate had planned to vote on the BCRA prior to the July 4^th recess but on June 27, 2017, announced that they would delay the vote until after the holiday, due to insufficient support from both moderate and conservative Republicans. If the bill passes the Senate, it will then go to the House for a vote.