The House-passed health bill to repeal the Affordable Care Act (ACA) — the American Health Care Act (AHCA) — would slash programs that help people get health coverage and use most of the savings to pay for tax cuts for high-income households and corporations. The Congressional Budget Office (CBO) estimates that the bill would increase the number of uninsured by 23 million people and make coverage worse or less affordable for millions more.
Now, the Senate is working on its version of the AHCA. Despite initial claims that the Senate would start over and develop its own legislation, Senate leaders have said, "the practical matter is that 80 percent of what the House did we're likely to do." This page tracks reports of how the Senate may change the House bill and analyzes whether the reported tweaks would meaningfully alter the House bill's effects. So far, the reported changes easily fit within Senate leadership's 80 percent framework: they would result in a Senate bill with virtually the same overall harmful impacts as the House bill.
| Major Provisions | What the House Bill Does | Reported Senate Changes | Long-Run Impact of Reported Changes |
|---|
| Medicaid expansion | Effectively ends expansion, which extended coverage to 11 million low-income adults | Ends expansion a little more slowly: ACA expansion funding may phase out over several years, versus ending in 2020 | None |
| Medicaid per capita cap | Caps and cuts Medicaid for seniors, people with disabilities, and families with children | No major changes reported; some senators continue to push for even deeper cuts, or other harmful changes | None or minimal — or potentially deeper cuts |
| Individual market changes | Slashes marketplace premium tax credits and eliminates cost-sharing assistance while raising premiums by eliminating the individual mandate | Unknown, but past discussions have focused on restoring less than one-third of House bill's subsidy cuts | At best small improvements: coverage would still be unaffordable for people who are older, lower-income, and live in high-cost states |
| State grants | Provides $138 billion over ten years that's supposed to solve problems ranging from individual market premium increases to Medicaid cuts | May add modest additional funding for opioid treatment | Minimal: even with modest funding increases, grants would still offset only a small fraction of bill's $1.1 trillion total coverage cuts and wouldn't get people treatment they need |
| Consumer protections | Lets states waive the ACA's standards for what services plans have to cover and its prohibition on charging people with pre-existing conditions higher premiums | May "only" let states waive benefit standards, which CBO found could lead plans in half the country to drop coverage for mental health, substance use, maternity care and other benefits | Minimal: people with pre-existing conditions still wouldn't have access to the services they need |
| Tax cuts | Cuts taxes by more than $600 billion, with most benefits going to high-income households and corporations | May delay certain tax cuts — but no discussion of dropping major tax cuts in order to restore coverage | None |
Ending the ACA Medicaid Expansion
What the House bill does: The House bill effectively ends the ACA's Medicaid expansion, which has allowed 31 states and the District of Columbia to extend coverage to 11 million low-income adults. Starting in 2020, states would have to pay three to five times as much as they do now to cover new expansion enrollees, forcing most or all states to end their expansions. That would reverse gains in coverage, access to care, health, and financial security; sharply increase uncompensated care costs for states and hospitals; and set back state efforts to combat the opioid epidemic.
What the Senate is reportedly considering: The Senate bill will reportedly phase down federal funding for expansion over several years, starting in 2020 — but it would still effectively eliminate the Medicaid expansion in the long run, leaving millions of low-income adults uninsured. As we've explained, expansion states won't be able to absorb a $35 billion hit to their budgets, no matter when it occurs. And poor and near-poor people losing Medicaid coverage won't be able to afford individual market premiums that would often exceed a quarter, half, or even their entire incomes, even after taking tax credits into account.
The reported Senate "compromise" wouldn't even have much effect in the short run. At least eight Medicaid expansion states — Arkansas, Illinois, Michigan, Montana, New Hampshire, New Mexico, and Washington — have expansion "trigger laws" under which their Medicaid expansions automatically end if the federal matching rate for expansion enrollees falls at all. Under the reported Senate proposal to phase down expansion funding, these state triggers would still go off in 2020 — just like under the House bill. Moreover, even non-trigger states would see their costs for new expansion enrollees rise significantly starting in 2020. Few state legislatures will choose to come up with extra funding to keep their expansions going when the federal funding cuts, and required state funding increases, will keep rising each year. Thus, even non-trigger states would likely freeze enrollment in their expansions starting in 2020 — just like under the House bill.
Cutting and Capping Medicaid for Seniors, People with Disabilities, and Families with Children
What the House bill does: The House bill would also end Medicaid as we know it for tens of millions of seniors, people with disabilities, and families with children. Today, Medicaid is a federal-state partnership, with the federal government covering a fixed share of states' Medicaid costs. The House bill would convert virtually the entire program to a per capita cap: an arbitrary cap on per-enrollee federal Medicaid funding, which would cover a falling share of states' actual costs over time. What's more, the cuts under a cap would be deepest precisely when need is greatest, since federal Medicaid funding would no longer increase automatically in response to public health emergencies like the opioid epidemic or to a new costly breakthrough treatment or drug.
What the Senate is reportedly considering: Based on press accounts, some senators are still pursuing an effort to lower the per capita cap growth rate, which would deepen the House bill's Medicaid costs. And the Senate is reportedly also considering a more modest change that could make the cap even worse, forcing states to make even deeper cuts over time.
For more on efforts to deepen the House bill's per capita cap Medicaid cuts, see: Toomey-Lee Proposal Would Significantly Expand House Bill's Already Deep Medicaid Cuts
For more on the reported Senate changes to the House bill's per capita cap, see: Senate Change to Medicaid Per Capita Cap Could Deepen Federal Funding Cuts
Raising Premiums and Deductibles, and Slashing Tax Credits
What the House bill does: The House bill cuts about $300 billion from subsidies that currently help moderate-income people afford individual market coverage, slashing tax credits that help people afford their premiums and eliminating subsidies that help low-income people pay deductibles, copays, and coinsurance. It also increases "sticker price" premiums starting next year by repealing the ACA's individual mandate. In total, the bill would raise out-of-pocket costs (premiums, deductibles, copays, and coinsurance) by an average of $3,600 in 2020 for people who buy health insurance through the ACA marketplace — and by far more for older people, lower-income people, and people in high-cost states.
What the Senate is reportedly considering: According to press accounts, Senate Republicans have not settled on an approach to modifying the House bill's tax credits, but they may be considering a proposal from Senator John Thune to increase tax credits for older consumers. When we analyzed an earlier proposal that would have increased tax credits in the House bill for older consumers from $4,000 to nearly $6,000, we found it made little difference to the affordability problems the House bill created. Out-of-pocket costs for marketplace consumers would still rise by an average of $2,900 in 2020 — more than 80 percent as much as under the House bill. And older consumers would still be hit the hardest.
Removing Protections for People with Pre-Existing Conditions
What the House bill does: The House bill removes key market reforms and consumer protections that the ACA put in place nationwide. Under the House bill, states could choose to let individual market plans go back to excluding key services, charging people with pre-existing conditions unaffordable premiums, or both.
What the Senate is reportedly considering: The Senate will reportedly "only" let states waive the "essential health benefit" standards for what plans have to cover, while maintaining the ACA's ban against charging people with pre-existing conditions higher premiums. But that distinction would make little difference to people with pre-existing conditions or others with serious medical needs. CBO found that, if states are allowed to waive essential health benefits standards, individual market health plans in half of the country could go back to excluding coverage for mental health, substance use treatment, maternity care, and other key services. It concluded, "out-of-pocket spending on maternity care and mental health and substance abuse services could increase by thousands of dollars in a given year for the nongroup enrollees who would use those services."
What's more, eliminating essential health benefits standards would weaken other core ACA protections, including some that apply to people who work for large employers. That's because the ACA's prohibitions on annual and lifetime limits — and the requirement for most employer plans to cap enrollees' out-of-pocket spending each year — are tied to the essential health benefits standards. These protections are especially critical to people with costly pre-existing conditions. Before the ACA, such people often faced unaffordable out-of-pocket costs, even if they had health insurance through their jobs.
For more on the reported Senate changes to the House bill consumer protections provisions, see: If Senate Republican Health Bill Weakens Essential Health Benefits Standards, It Would Harm People with Pre-Existing Conditions
Cutting Taxes for the Wealthy, Insurers, and Drug Companies
What the House bill does: The House bill uses most of the savings from cutting marketplace subsidies and Medicaid to pay for about $660 billion in tax cuts that go primarily to the wealthy, insurers, and drug companies. By 2025, tax cuts would average over $50,000 per year for households with annual incomes exceeding $1 million.
What the Senate is reportedly considering: Senate Republicans are reportedly considering delaying some of the House bill's tax cuts. But they do not appear to be open to dropping major tax breaks in order to restore coverage for some of the millions who would otherwise lose it.
