This week, the Senate revealed its version of a health bill. Almost immediately, you had politicos from the right and left come out to either blast it or support it. Social media is full of memes and information that is likely intended to influence you rather than inform you.
For our Take Command Health members, we want to help you cut through the political smoke and mirrors. Below you'll find a table that compares the Senate Bill (known as the "Better Care Reconciliation Act" (BCRA) to the House Bill ("American Healthcare Act" aka AHCA) to the Affordable Care Act (ACA aka Obamacare).
A few high-level notes before diving in:
- The Senate Bill (BCRA) is more like an amendment to ACA. It doesn't introduce its own legislation as much as it edits ACA.
- On the whole, BCRA feels like a compromise between ACA and AHCA with a few notable exceptions (see below).
- Many of the changes in BCRA were actually part of Hillary's campaign platform and "fixes" to the ACA that Democrats were recommending. Of course, you'd never pick up on that from the political discourse, but it's true. There are some underlying philosophical differences though that I don't want to minimize--most notably greater flexibility for states vs federal regulations.
- The BCRA is not law. It must be passed in the Senate and will unlikely undergo some negotiation as several prominent Senators have said they will not support it in its current form.
- If the BCRA is passed, it will then go to a committee to be reconciled with the House Bill AHCA before it's sent to the President to be signed.
How does the Senate Health Bill (BCRA) compare to ACA and AHCA?
In this chart, we focus exclusively on issues that impact our individual insurance clients. There are many other parts--including taxes and medicare--that are important but we won't be examining all of them here.
Feel free to download our comparison chart in Excel or browse the table below.
|Republican "Senate Bill"|
|Coverage and Requirements|
|Essential Health Benefits||All plans required to cover 10 Essential Health Benefits (EHB)||No change, but allows States to modify through waivers||No change, but allows States to modify through waivers||When looking at coverage and requirements, both BCRA and AHCA are very similar to ACA. The difference is the Republican plans introduce more flexibility for states.|
|Coverage for Pre-Existing Conditions||Yes||Yes
(if meet continuous coverage requirements)
|Children can remain on parents' plan until 26 years old||Yes||Yes||Yes|
(if meet continuous coverage requirements)
|Continuous Coverage||No requirement||Required
Penalty is 30% premium increase for 1 year and potential underwriting requirements (by state)
|Individual Mandate||Individuals are required to pay a penalty of 2.5% of income or $695 for not maintaining coverage||Removes mandate, added a continuous coverage provision||Removes mandate||The biggest difference the Senate and House will have to reconcile is the continuing coverage requirement. Without a mandate or continuous coverage, it's unclear how the Senate intends to keep individuals from gaming the system. This may be a limitation of the Senate Reconciliation measures.|
|Employer Mandate||Employers with 50 or more employees were required to provide "affordable coverage" or face penalty||Removes mandate||Removes mandate|
|Premiums and Tax Credits|
|Premium Age Ratio||1 to 3||1 to 5
(States can apply for waivers to adjust)
|1 to 5||Seniors and senior lobbyists will complain about having to pay more. This is a move to lower prices for young, healthy adults to stabilize the insurance markets|
|Premium Tax Credit Eligibility||Based on household size and income; Available for people between 100-400% of the poverty limit||All Americans with income phase out starting at $75k single or $150k married||Same as ACA, except there's no floor and the top limit is 350%||BCRA actually extends tax credits to lower income Americans. This is for states that have not expanded Medicaid|
|Plans Available to Use Tax Credits||Healthcare.gov only||Healthcare.gov and private "off-exchange" plans||Healthcare.gov only||Hopefully the AHCA option to apply credits to any qualified plan will be implemented|
|Tax Credit Calculation||Based on a benchmark plan (the 2nd lowest cost silver plan in an area). Credits amounts calculated to reduce a person's cost to 9.6% of income.||Credits based on age only (sliding scale)||Similar to ACA, but adjusts the benchmark plan to be the average cost of a Bronze plan. Credits amounts are calculated using a sliding scale so that a person doesn't pay more than 2%-16.2% of income based on age.||Older Americans will be expected to pay more. While many will balk at this, this move is almost certainly an effort to get younger, healthier people into the market|
|Cost Sharing Subsidies||Provides additional cost sharing benefits (for copays, coinsurance, etc) for individuals between 100-250% of the poverty level||Paid through 2019 and then stopped in 2020||Paid through 2019 and then stopped in 2020||AHCA and BCRA maintain ACA subsidies through 2019. Lower income recipients could afford plans (premiums) but potentially not costs (copays, etc).|
|Other Consumer Impacts|
|Health Savings Accounts (HSAs)||Made no changes to prior HSA laws. HSA utilization was difficult as deductibles and max-limits moved back contribution limits||Increases contribution limits to be the health plan's deductible and max-limit||Increases contribution limits to be the health plan's deductible and max-limit||Most of these changes are supported by Republicans and Democrats|
|Association Health Plans||Not allowed||Not allowed||Would allow groups of affiliated small businesses to purchase coverage together||This is surprising in the Senate version. It was pushed for by some members of the House but may be a sticky reconciliation point.|
We'll be keeping a close eye on amendments and changes to the BCRA. We'll also be studying the impact and implications of the proposed provisions above.
As a Take Command Health client, our job is to keep you informed and to be your advocate. No matter how the laws shake out, we'll work to match you with the best coverage possible.
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I wrote this blog to help people make smart health insurance decisions. I am a small business owner, a husband, and a dad to three boys, so I've seen firsthand how important understanding insurance decisions can be. As a co-founder of Take Command Health and a licensed health professional, I've been recognized as a leading expert on healthcare transparency and defined contribution arrangements (QSEHRA). I've been featured in the New York Times, Wall Street Journal, Dallas Morning News, Forbes and others. Learn more about me and connect with me on our about us page. Thanks!