WASHINGTON — Senate Republicans, barreling toward a conclusion of their efforts to dismantle Obamacare, on Thursday night unveiled a new piece of legislation they will consider: a so-called “skinny repeal” that takes aim at only a handful of the Affordable Care Act’s least popular provisions.
The plan revealed by GOP leaders would strip the “repeal” effort to its most basic elements: nixing the mandate that requires Americans to buy insurance or face a penalty, as well as the companion policy that requires employers to offer health insurance to their workers.
The new plan also includes a provision to eliminate some Planned Parenthood funding and another that repeals the Prevention and Public Health Fund in 2019, not in 2018 as written in previous drafts. The measure includes $422 million in added funding for community health centers, as well as a temporary repeal of a tax on the medical device industry. There is no added money, as had been speculated, to fight the opioid crisis.
It isn’t yet clear that this new “skinny repeal” has the support to pass. If it does clear the Senate, Republicans in both the House and Senate have suggested lawmakers would then meet in a “conference committee” to hammer out the differences between this skinny repeal and the much broader “repeal and replace” bill that passed the House in May — the one Trump infamously decried as “mean.”
Given the politics of both chambers, however, some lawmakers and lobbyists caution there’s a chance the House will simply take up this “skinny repeal” measure. Should it pass, and earn President Trump’s signature, this package would be the GOP’s answer to more than seven years of promises to repeal and replace the Affordable Care Act.
STAT takes an early look at what the “skinny” Republican plan could mean for Americans who rely on the health law’s marketplaces, for those with Medicaid, and for others.
People who buy insurance on HealthCare.gov
If you’re one of the 21.8 million or so Americans who don’t get health insurance through a job or through Medicare, Medicaid, or Veterans Affairs and purchases it instead either privately or through an Obamacare exchange, you’re in for a price hike.
And maybe a steep one. As long as you still want insurance, you could face premiums as much as 20 percent higher than you otherwise would have, according to a Congressional Budget Office analysis shared with Senate Democrats. That could total about $1,238 more in premiums per person per year, according to an analysis from the left-leaning Center for American Progress.
That’s in part because insurers believe that healthy people, who help spread out the costs of sicker people, will drop out. Insurers would raise prices to cover that difference, making the plans more expensive for everyone else.
Some people — currently, around 10 million — would see their Obamacare subsidies go up as a result, cushioning the blow of such a steep price hike. But higher-income Americans who don’t qualify for subsidies would bear the brunt of the increase. Anyone who purchases coverage off of the exchanges would too.
As fewer people sign up for coverage, insurers might also lose the incentive to sell plans in every area. Already some 40 counties in the country might have no insurance offerings on the Obamacare exchange next year. That number could jump if the individual mandate disappears.
Another change in the new bill, which makes it easier for states to seek overhauls of their own insurance marketplaces, could also portend major changes for people who don’t get their insurance through a job, Medicare, or Medicaid. But it’s too soon to tell how broad the waivers might be or which states might apply for them.
People who don’t want health insurance
There’s at least one category of people who clearly stand to benefit from Republicans’ plan: those who don’t want to purchase health insurance at all, whether that’s because they’re poor or relatively healthy or just aren’t interested.
At its core, the skinny plan simply eliminates any penalties associated with not buying health insurance. The 6.5 million Americans who paid an average $470 penalty in 2015 won’t face that same penalty again — or the higher penalties that took effect in 2016.
People who might have enrolled in Medicaid not because they wanted it, but to avoid the penalty, are off the hook, too. Those who elected employer coverage before can opt out and skip the fee on Tax Day as well.
People who rely on Medicaid coverage
Unlike every other health care policy proposal from Republicans this year, the “skinny” package doesn’t directly cut federal support for Medicaid or unravel the program’s expansion. Enrollees who want to keep their coverage wouldn’t see a major change, though that may not continue to hold true if certain state waiver provisions are included and states take advantage of them.
But Dee Mahan, director of Medicaid initiatives at the nonprofit Families USA, cautioned that states might not keep up their commitment to Medicaid funding if broader health insurance markets unraveled.
“How states respond in terms of their own funding for their Medicaid programs, when their individual markets go into what everyone is predicting will be total disarray — that may end up affecting Medicaid coverage,” she told STAT. “What do they end up feeling like they have to do in terms of state spending?”
Federal uncertainty might also delay states’ interest in expanding Medicaid, a long-shot possibility in at least a handful of states where Democrats could take gubernatorial or state legislature positions in the coming years.
People who get insurance through their job
Most large employers offered health insurance before Obamacare, and there’s little evidence to suggest that would change. Even the law’s architects don’t see the employer mandate as being nearly as central to the law as the individual mandate.
But the CBO analysis shared with Democrats does suggest that as many as 6 million people could lose their employer-sponsored health insurance as early as 2018 under the “skinny” proposal. That’s in part because some people wouldn’t want to sign up for an employer-sponsored plan without the threat of the individual mandate — but also because employers might have fewer incentives to offer those plans without their own penalty.
“Under current law, the prospect of paying the employer mandate penalty tips the scale for some businesses and causes them to decide to offer health insurance to their employees,” the CBO wrote in its analysis of the broader Republican repeal bill that was voted down earlier this week. “Thus, eliminating that penalty would cause some employers to not offer health insurance.”
Some of the same premium increases looming for people with individual market plans could also hit the employer market, albeit in a much less dramatic way, according to Paul Van de Water, a senior fellow at the left-leaning Center on Budget and Policy Priorities.
“The fact that you get more people to take up the offer may have some small effect on holding down premiums,” he said, suggesting that the reverse would be true under a repeal scenario. “I don’t want to overemphasize that, it’s probably marginal, though it may have a greater effect for some, particularly for some smaller employers.”
He said the most significant effect from a straightforward employer mandate repeal, however, would be on small businesses looking to grow larger. They might put off the decision to offer health insurance longer, even as they grew larger, if the threat of the penalty did not loom.
People who like Health Savings Accounts
Just like the bill that cleared the House earlier this year, the new Senate “skinny repeal” package includes a number of changes aimed at making it easier for people to use health care savings accounts. So-called HSAs, which are typically paired with high-deductible insurance plans, let people save money for health expenses without paying taxes on those funds.
The Senate bill doesn’t go as far as the House did in loosening restrictions on the accounts, but it would raise the contribution limits for the next three years. Anyone with enough income to save money for health care would be able to avoid taxes on more of those expenses.
People who rely on Planned Parenthood
Though the Senate parliamentarian ruled that an earlier effort to defund the women’s health provider didn’t clear Senate rules, Republicans on Capitol Hill are again targeting federal spending on the organization.
Their pitch is partisan and straightforward: They want to strip as much of the group’s funding as they can. The House-passed American Health Care Act would have blocked one year’s worth of Medicaid reimbursements for the group, amounting to about $550 million in funding. This Senate bill appears to do the same.
A Planned Parenthood spokesperson said the bill applies the funding restrictions to a second and much smaller provider of reproductive health services, Women’s Health Specialists of California, apparently in an effort to show that the bill isn’t targeting Planned Parenthood and thus meets Senate rules. It remains unclear whether providers beyond those two would be affected by the provision.
In the past, Republicans have regularly suggested including more funding for community health centers that they say provide similar services to Planned Parenthood, and outside experts suggested Thursday that may again be the GOP plan.
Dawn Laguens, an executive vice president for Planned Parenthood, said in a statement that the proposal would limit cancer screenings and birth control access for millions of women.
“The simple fact is that blocking millions from getting preventive care at Planned Parenthood would result in more undetected cancers and more unintended pregnancies,” she said.
This story has been updated with new details about the “skinny repeal” bill.