Senate Unveils Revised ACA Repeal Bill, the Better Care Reconciliation Act

After more than a month of tight-lipped deliberations, Senate Republicans finally unveiled their revised version of the American Health Care Act (AHCA)—known as the Better Care Reconciliation Act (BCRA), which will repeal many aspects of the ACA.

The 142-page bill—being referred to as a “discussion draft,” meaning some provisions could be altered to garner more support before it goes to a vote—contains numerous changes to the United States health care law, notably a repeal of the ACA’s individual mandate and employer mandate. The bill also removes all of the ACA’s subsidies for low-income patients and replaces them with a subsidy program. The new program changes the low-income threshold from 400% of the poverty line to 350%. 

Another major change includes allowing states to opt out of many of the ACA’s regulations via waivers. The Republican bill aims to make the waiver process easier for states and will allow them to create their own health care rules. The waiver process would give states the power to dismantle many of the ACA’s core regulations including the requirement for state-based exchanges, essential health benefits. 

However, the bill does not include language that was included in the House version, which allowed states to waiver the community rating—meaning states would not be able to allow insurers to charge patients with preexisting conditions more than healthy patients. While this change may win over some of the moderate Republicans who were nervous about the House’s version of the AHCA, it could make the bill harder to pass in the House later down the road. 

“Obamacare’s years-long legacy of soaring prices, shrinking choices, and total failure will continue to get worse unless we act,” Senate Majority Leader Mitch McConnell said on the Senate floor. “The Obamacare status quo is unsustainable, it’s hurting Americans, and it will continue to do so unless we act. The American people are demanding relief, and we intend to deliver it to them. That’s why Senate Republicans are continuing to work toward smarter health care solutions that will finally allow us to move beyond this failed law.”

In a huge win for insurers, BCRA includes guaranteed funding of the ACA’s cost-sharing subsidies for another 2 years. This comes after Marilyn Tavenner, CEO of the AHIP, the leading health insurance lobby in the country, met with Sen McConnell. Funding the cost-sharing subsidies will help keep premiums from skyrocketing during the law’s rollout over the next few years. The bill also repeals the ACA’s cost-sharing subsidy program in 2020.

The bill also includes major changes to the Medicaid program and Medicaid spending. Under the new bill, ACA enhanced Medicaid funding to states that expanded their Medicaid program would be rolled back beginning in 2020.  The bill also significantly changes the Medicaid program through a block-granting like system that provides states with a set amount of Medicaid funding per person—as opposed to the open-ended guaranteed funding in the ACA.

Planned Parenthood funding will also be cut for 1 year under the new bill, which would remove the program from Medicaid. This measure is likely to cause some issues among moderate Republican Senators, including Lisa Murkowski (R-Alaska) and Susan Collins (R-Maine).  This portion of the bill could be removed if a number of Senators pull their support before a vote is called.

The bill also repeals all of the same taxes on industry stakeholders that were in the original House version. 

“Even as we continue to get more details [about the bill] the broad outlines are clear: this is a bill designed to strip away protections from the Americans who need it the most to give a tax break to those who need it the least,” Senate Minority Leader Chuck Schumer said on the Senate floor.

Senate Republicans also announced some provisions to the newly released draft of the Better Care Reconciliation Act (BCRA), including a penalty for those who have a lapse in coverage.

Under the new provision, enrollees who had a lapse in coverage for 63 days would have to wait an additional 6 months before qualifying for new health insurance. This provision is designed to prevent patients from waiting until they need health insurance, to sign up for it.

A major critique of both the House’s AHCA, and the Senate’s BCRA, is that without the ACA’s individual mandate—which both laws would repeal—healthy Americans will abandon the market until they get sick and need coverage. This would create a scenario of unsustainable premiums due to the high-risk of the coverage pools.

The House version of the bill attempted to deal with this by levying a 30% premium surcharge for the first year for any enrollee that did not previously have coverage for 63 days.

The Congressional Budget Office scored the Senate’s bill only slightly better than the House’s version, predicting that 22 million Americans could lose insurance over the next decade under the BCRA.

It is still unclear if Republicans can secure a 51-vote majority, but reports suggest that there will be a vote on the bill sometime after the
July recess. —David Costill