As congressional Republicans move to solidify their Obamacare repeal-and-replace legislation, concern is mounting that their strategies will leave millions of Americans with less financial assistance and more expensive coverage.
A new analysis on Wednesday from the Kaiser Family Foundation projects that the average premium subsidy – which people use to help purchase marketplace coverage – would shrink by at least 36 percent in 2020 under GOP proposals being considered.
85% The percentage of Americans in the HealthCare.gov marketplace who receive a federal tax subsidy to help pay for it.
House Speaker Paul Ryan’s “A Better Way,” the House of Representatives’ discussion draft bill and Health and Human Services Secretary Tom Price’s “Empowering Patients First Act” all provide tax credits to help consumers purchase coverage that are based on age rather than need. And the annual growth in those subsidies is based on inflation, not income or cost of coverage as it is under the Affordable Care Act.
The impacts could be sweeping, as 85 percent of Americans who buy health insurance through the marketplace get some kind of federal tax subsidy to help them pay the monthly premiums.
In the House draft bill, Kaiser notes, the average tax credit for current marketplace plan members would increase from an estimated $2,957 in 2020 to $3,729 in 2027. Under the existing health law, however, the average tax credit would be significantly more in 2020, at $4,615. And it would increase to $6,648 in 2027, Kaiser found.
36%The amount by which the average tax subsidy could fall under several Republican proposals to repeal and replace the health care law, according to a Kaiser study.
In addition, far fewer Americans would have been able to find low-cost marketplace coverage this year if the Affordable Care Act’s premium tax credits were based on inflation rather than cost of coverage, according to an Obama administration analysis obtained by McClatchy.
The report, one of the last under former HHS Secretary Sylvia Burwell, is the latest to suggest that the Republican plan to repeal and replace the health law would not provide the same level of financial assistance for marketplace consumers.
The January analysis found that 72 percent of HealthCare.gov plan members could obtain health insurance for less than $75 per month in 2017 with assistance from premium tax credits, the federal subsidies that help pay for coverage. But only 46 percent could’ve found plans for that price if the tax credits were based on the growth of the consumer price index, the report found. That’s a 36 percent decline.
82% Amount of North Carolinians using HealthCare.gov plans who can find coverage for under $75 a month this year. Under Republican proposals, just 22 percent of those consumers would be able to acquire such cheap coverage.
In North Carolina, where 82 percent of marketplace consumers can find health plans with premiums of $75 or less this year, only 22 percent could have done so if the subsidies were indexed to inflation, the report found.
In Kansas, 69 percent of marketplace HealthCare.gov consumers can find coverage this year for less than $75 per month. But only 21 percent could do so if the tax credits were based on inflation growth, the Burwell study found.
Nationally, the tax credits helped more than three-fourths of HealthCare.gov plan members find coverage for $100 a month or less this year, the study found. If the subsidies had been tied to inflation, though, just 55 percent of those consumers could have found that coverage.
The tax credits now are based on an individual’s income and cost of coverage.
The HHS report was prepared at the request of Rep. Richard Neal, D-Mass., the ranking member on the House Ways and Means Committee.
In an email statement on Wednesday, Neal said the HHS report showed “what consumers would really face under Trumpcare.”
“The proposal designed by the Republicans would make health care less affordable for millions of Americans,” he said in the message. “It would raise out-of-pocket costs for middle-class Americans and their families, because their tax credits would cover less of the cost over time of their insurance premiums than today. President Trump promised more people would be covered with better care, all at a lower cost. But what he’s actually proposing would deliver less coverage at higher cost.”