The American Health Care Act, H.R. 1628, passed by the U.S. House of Representatives. The vote was mostly along party lines, with the final tally being 217 -213 with 18 Republicans and all the Democrats voting against the measure.
“The National Restaurant Association is pleased to see progress made by the House on the American Health Care Act. This vote is an important first step in improving our health care system. We will continue to work with Congress on further legislative actions to fix ongoing issues with the employer mandate. The work to pass repeal of the 30-hour rule, streamline employer reporting requirements, and repeal the seasonal worker definition will still needs the attention of Congress to help alleviate the strain on employers in the restaurant industry.” – Cicely Simpson, Executive Vice President of Policy & Government, National Restaurant Association
Please find the bill and amendment summary below. The texts and additional materials can be found on the House Rules Committee website, https://rules.house.gov/bill/115/hr-1628.
Zeroes out the individual mandate and employer mandate penalties: The legislation – which focuses on provisions of the ACA with a budgetary impact, also known as budget reconciliation, – zeroes out the ACA’s penalties for 1) individuals who fail to get coverage and 2) for large employers who fail to offer coverage to full-time employees and their dependents. The rules of the budget-reconciliation process limit the ability of Congress to repeal the employer mandate and employer-reporting rules at this stage of the process. We continue to work for full repeal as most of the policy requirements and burdensome parts of the law are in the employer mandate.
Medicaid expansion: The House GOP bill would allow states that have expanded Medicaid to continue to enroll people into their programs at the ACA’s enhanced federal match rate until Jan. 1, 2020, after which enrollment would be frozen to new entrants. States could create their own expansion programs to start in 2020, or use supplemental funds to extend coverage to people, pay providers impacted by uncompensated care, or accommodate other arrangements.
Replaces ban on pre-existing conditions with a “continuous coverage incentive”: Beginning with the 2019 plan-year open-enrollment season, the legislation provides a 12-month lookback period to determine if applicants had a lapse in coverage for more than 63 days. In those cases, issuers can assess a flat 30 percent late-enrollment surcharge on top of their base premium.
Tax credits: The legislation replaces the ACA’s income-based premium tax credits that currently help people buy health insurance plans through government marketplaces with an advanceable, refundable tax credit based on age and family size. To be eligible, an individual must generally not have access to government health insurance programs or an offer of insurance from any employer. This provision would provide significant relief for employers by eliminating the complex income-reporting requirements under the ACA. To qualify for the new tax credit, individuals would be required to get a letter from their employer certifying that they do not qualify for employer-sponsored health insurance coverage. The IRS would add a box on the W-2 forms for employers to inform employees of their health insurance status.
Cadillac tax extended: The House GOP considered but then dropped a proposal to cap the current exclusion for employer-provided insurance coverage. Instead, their legislation extends the 40 percent excise tax on high-cost employer-sponsored health coverage, also known as Cadillac plans. The tax is currently set to take effect in 2020, but the legislation moves the effective date to 2025.
The bill included three additional amendments —
•Rep. Tom MacArthur, R-N.J. amendment, that deletes the essential health benefit provisions included in the original manager's amendments and instead allows states to receive waivers from certain minimum benefit and other requirements of the 2010 health law;
•Rep. Fred Upton, R-Mich. amendment, which provides $8 billion over five years to help individuals with pre-existing conditions whose insurance premiums increased because the state was granted a waiver under the MacArthur amendment allowing insurers to raise premiums based on an individual's health status; and
•Reps. Gary Palmer, R-Ala., and David Schweikert, R-Ariz. amendment, to create a $15 billion federal risk sharing program to help cover the costs of high medical claims.
Additional legislation was also passed, H.R. 2192, Congressional Health Care Waivers introduced by Rep. Martha McSally, R-Ariz. This bill was necessary to block a congressional exemption in MacArthur’s amendment from taking effect. Republicans have said this exemption was included to address concerns about keeping the bill in line with the so-called reconciliation rules, which allow the Senate to clear measures focused on budget changes with simple majority votes. This was accepted unanimously.