The American Health Care Act Deena Lahn VP Policy and Advocacy 3/16/17

Impact on Patients CBO report: 14 million Americans would lose coverage in the first year, rising to 24 million in 2026 and reversing all the gains from the ACA. Of the 24 million, 14 million are Medicaid recipients. “By 2026, Medicaid spending would be about 25% less than what CBO projects under current law.” Establishes a 1 year freeze on federal funding to family planning providers.

Impact on Medi-Cal Financial support for Medicaid Expansion Ends: The American Health Care Act does not end the Medicaid expansion, states will still be allowed to cover these people. However, the enhanced FMAP associated with the Medi-Cal expansion population ends December 31, 2019.  After that, enhanced FMAP is only for existing beneficiaries who maintain continuous enrollment Federal funding for Medicaid Entitlement ends: All Medicaid funding will become subject to a per capita cap allocation beginning federal fiscal year 2019 with spending allotments for 5 enrollee categories.  The elderly; the blind & disabled; children; non-expansion adults; expansion adults would each be assigned a spending target based on FY 2016 spending adjusted by medical inflation.  Other changes that will reduce Medicaid rolls and costs: bi annual renewals Ends presumptive eligibility for the MCE population limits retroactivity to one month No more presumptive eligibility provisions for the MCE population. 

Other Major Changes to ACA Eliminates the tax penalties of the individual and employer mandate effective December 31, 2015. Bases tax credit support primarily on age rather than income, and without current accounting for regional cost differences. Starting 1/1/20, Establishes an advanceable, refundable tax credit between $2,000 - $4,000. Allows 1:5 age rating instead of 1:3. Eliminates the actuarial value standards of plans offered in the exchange.

Tax Cuts included CBO estimates $880 billion lower Federal spending on Medicaid. Federal deficit reduction score of $337 billion. Difference is elimination of taxes, primarily for those making over $250,000/year.

Impact on Clinics The direct impact on clinics from this bill is the dramatic reduction it will cause in insured patients: this bill does not address PPS or Federal 330 funding. However, this bill was designed to be passed by a majority and thus cannot make certain programmatic changes – more changes are to be proposed, including allowing for low cost, high deductible plans to be sold across state lines.

Impact on Other Providers A study commissioned by the American Hospital Association suggests a $166 billion loss from this bill. This is net of a restoration of DSH payment cuts from the ACA.

California Governor Brown and Democratic state leaders have expressed their desire not to roll back California’s increased in insured people. However, under the Federal legislation there would be a lot less federal money to spend and thus changes will have to be proposed or taxes raised.

Advocacy Steps: Sign up to be a health advocate~!http://www.cpca.org/index.cfm/policy-advocacy/advocacy/campaigns/advocacy-network/advocacy-network-sign-up-form/ Discussion of Economic Impact and patient impact Postcards Patient Stories Contacts to Talk to the Press P and I

What’s next? No one knows! Conservative House members have objected to the refundable tax credits, which they call “Obama Care Lite” More moderate members, especially in Medicaid expansion states, are worried about increasing the number of uninsured. Not clear whether or not the bill will get out of the House but the Senate is seen as a more likely place to stop the bill – at the current time, there is not a majority of Senators who have embraced all of the fiscal and policy changes in the House bill.