House Republicans released draft legislation Monday to replace former president Barack Obama’s signature health care law, proposing to phase out the Affordable Care Act’s Medicaid expansion and change the law’s subsidies for private insurance.
The bill’s details released Monday do not say how many people would have coverage compared with Obamacare. But federal support would be reduced to allow Republicans to repeal the law’s tax increases on the wealthy, insurance companies, drugmakers and others.
The bill would also repeal the requirements that most people buy insurance and larger employers provide it.
It would not repeal the popular provision barring insurance companies from denying covering to people with pre-existing health problems. Instead, to keep people from buying coverage only when they need it, insurers could raise premiums 30% for those jumping back into the market.
The legislation is already under attack not only from Democrats, but from some Republicans who have raised concerns about eliminating coverage for millions of people who got coverage under the bill’s expanded Medicaid eligibility. In addition, some of the most conservative Republicans have warned that the replacement tax credits the bill provided to help people buy insurance would be just another entitlement program.
House committees are expected to take up the legislation later this week.
“Our legislation transfers power from Washington back to the American people,” said Rep. Kevin Brady, the Texas Republican who heads the House Ways and Means Committee. “We dismantle Obamacare’s damaging taxes and mandates so states can deliver quality, affordable options based on what their patient populations need, and workers and families can have the freedom and flexibility to make their own health care choices.”
States that expanded Medicaid under the Affordable Care Act to people earning up to 138% of poverty could still get federal funding for those enrolled before January 2020. But if those beneficiaries left the program, the federal funding would disappear.
States would also no longer receive an open-ended federal match on the amount they spend on all Medicaid beneficiaries. Instead, they would be given a set amount based on the number of enrollees.
Four Republican senators — Rob Portman of Ohio, Shelley Moore Capito of West Virginia, Cory Gardner of Colorado and Lisa Murkowski of Alaska — said Monday they were concerned that an early draft of the bill had not provided enough “stability and certainty” for families covered by the Medicaid expansion. They said any replacement plan offer a “stable transition period and the opportunity to gradually phase-in their populations to any new Medicaid financing structure.”
It was not immediately clear whether the bill unveiled Monday night would put those concerns to rest.
Some conservative Republicans have complained about the subsidies that would replace the tax credits the ACA provides to help people earning up to 400% of poverty buy private insurance.
The GOP alternative offers refundable credits which become more generous with age. Unlike an earlier draft, the credits phase out at higher income levels. But at lower income levels, recipients can still receive a larger credit than the amount of taxes they owe, which has raised concerns among some Republicans.
The tax credits would range from $2,000 to $14,000 a year.
Those receiving tax credits can use them to purchase any insurance plans, not just those sold on the exchanges created by the Affordable Care Act. That would include purchasing “catastrophic” plans which offer limited coverage.
Democrats across the board have promised to fight any changes to the law that would scale back health care coverage.