All eyes are on Congress today, where the House is scheduled to vote on the American Health Care Act (AHCA). It's high legislative drama as Republican leaders still don't know if they have the votes to pass the measure.
The bill, backed by President Donald Trump, would partially repeal and replace the Affordable Care Act, aka Obamacare, and could dramatically impact health insurance for tens of millions of Americans. Here's what you need to know about what the bill does and where it stands.
Let's start with how things work under Obamacare. The ACA was primarily about fixing problems in the individual insurance market, which includes people who don't get coverage through work or government programs. If you weren't on the individual market, you might not have noticed the changes.
Under the old system, insurance companies could deny coverage to people with pre-existing conditions or charge higher premiums. Obamacare requires insurers to take on everyone, sick or healthy, and charge the same price for a comprehensive plan. To make sure the market isn't flooded with only the most expensive patients, everyone is required to buy insurance or pay a penalty. To help help people afford their plan, the law pays out subsidies to people making up to 400 percent of the federal poverty line. It also offers states more Medicaid dollars to cover adults at lower incomes.
On the surface, the House GOP bill has some similarities to Obamacare. It requires insurers to take on customers regardless of any pre-existing condition. It provides subsidies to people, in the form of tax credits, to buy insurance on the individual market. And it tries to encourage people to stay insured.
But the similarities end there.
The bill spends less on fewer subsidies, reduces Medicaid spending by large amounts, and uses the savings to eliminate taxes on wealthier Americans and medical companies imposed by the ACA. It would reduce the deficit by $337 billion over the next 10 years, according to the nonpartisan Congressional Budget Office.
First, the subsidies are different. If you qualify for help buying insurance under Obamacare, the government makes sure you don't pay more than a certain percentage of your income, which starts at 3 percent at low incomes and tops out at 9.5 percent for higher incomes. If premiums go up, the subsidies go up, too. Some low-income beneficiaries get additional help with out-of-pocket costs.
Under the House bill, though, you get a fixed tax credit that's based on your age, maxing out at $4,000 to start. If premiums are still too high to purchase insurance with that credit, you're stuck.
Second, the Medicaid expansion would be phased out and the program would change so that the federal government only pays states a set amount per person. States could also opt to take their Medicaid dollars as a block grant. Some 14 million fewer people would receive Medicaid coverage under these changes, the CBO estimated.
Finally, Obamacare's requirement to buy insurance is gone. In its place, insurers will be allowed to charge people 30 percent more on their premiums for one year if their coverage lapses.
Overall, the CBO estimates these changes would leave 24 million people without insurance by 2026 who would have it under Obamacare.
Older patients with low incomes will see big spikes in their premiums along with higher deductibles and out-of-pocket costs, especially if they live in rural areas where care tends to be expensive. A 64-year-old making $26,500 would pay an average of $12,900 more per year in premium costs, according to the CBO, and their insurance would not cover as much.
This is due to several major AHCA provisions: First is the change to a fixed tax credit. Second, the bill allows insurers to charge older customers up to five times as much as younger ones (the current limit is three times). Third, the bill drops an Obamacare provision that subsidizes out-of-pocket costs for lower-income beneficiaries. The AHCA also allows insurers to sell plans that cover fewer expenses.
On the flipside, younger and relatively more affluent customers would see some new benefits. The GOP's tax credits apply to people with incomes up to $75,000, which provides some aid to people who have seen their premiums go up in recent years but make too much to receive Obamacare benefits. Premiums will also go down for some younger customers, partly because older (and more expensive to insure) customers will no longer be able to afford insurance. If you want to see how the bill might affect you, the nonpartisan Kaiser Family Foundation has a handy interactive map.
As for the tax cuts, unless you're a shareholder in the affected medical industries or make over $200,000 a year in income ($250,000 as a couple), they won't affect you much. Seventy-nine percent of the tax cuts on high earners would go to millionaires, according to an analysis by the Center on Budget and Policy Priorities.
They mostly don't like it, for a variety of different reasons. Many conservative experts on health policy are upset the GOP plan doesn't include their proposals to reduce the cost of health insurance, some of which were left out for procedural reasons (more on that later) and others for political ones. Others think it's too similar to Obamacare. Moderates and liberals want more spending to prevent people from losing coverage and don't like that the bill boosts incomes for the rich while cutting aid to lower-income Americans.
No. Trump ran on repealing Obamacare, but he distanced himself from other Republicans by promising his plan would provide "insurance for everybody," lower deductibles and costs, and would not include Medicaid cuts. By any objective analysis, this bill would cover far fewer people than Obamacare, allow insurers to raise deductibles and out-of-pocket costs, and cut Medicaid by large amounts.
Good question — it's going to be a tough vote.
There are two groups threatening to vote it down for different reasons: Conservatives and moderates. As of Wednesday night, at least 27 Republicans were either hard "no" or leaning "no" by an NBC News count. That would kill the bill as GOP leaders can afford only 22 defectors, since no Democrats are expected to support the bill.
Conservatives, led by the House Freedom Caucus, say the bill preserves too many elements of Obamacare for them to support it and many of the top advocacy groups on the right, like Heritage Action and Club For Growth, are egging them on. Many would prefer to repeal Obamacare entirely (or at least more of it) as a starting point rather than jump into a replacement immediately.
Moderates have the opposite concern. They worry the bill is too radical and that it cause millions to lose health insurance. Some are worried that its cuts to Medicaid will hurt their state budgets. Addressing their problems would mean further angering conservatives and vice versa.
That doesn't mean the bill is dead, though. It's difficult to vote against your own party's president and Trump is aggressively pushing members to get on board.
On Wednesday night, House leaders and the White House were talking with the House Freedom Caucus about a possible deal to eliminate a major Obamacare provision called "Essential Health Benefits." These are 10 broad categories of care, like hospitalization and maternity care, that the law requires insurers cover.
Conservatives want to drop these requirements, which would allow insurers to offer plans that cover fewer items but have more affordable premiums as a result. Critics are worried insurers will use these cheap plans to attract customers who are already healthy while customers with chronic health issues won't be able to find an affordable plan that covers their needs. Politically, this issue could be more sensitive due to the current focus on the opioid addiction: EHB's currently require plans to cover treatment for substance abuse.
It gets more complicated, though. House Republicans are using a procedure called budget reconciliation to pass the bill because it requires only a bare majority in the Senate, rather than 60 votes. The downside is that it limits what Congress is allowed to include in the bill. Initially House GOP leaders argued changes to Essential Health Benefits would not pass muster with the Senate parliamentarian, but they seem more willing to test the waters now.
Then comes the Senate, where Majority Leader Mitch McConnell plans to quickly take it up. So far, it looks like an even tougher climb in the Senate.
The margin for error is slimmer than in the House: Republicans have 52 votes and can only lose two (Vice President Mike Pence would break a tie). There are conservative and moderate factions with serious concerns, but the moderates are considered a bigger obstacle on the Senate side versus the House.
Even then, things aren't done. The White House says it will address various issues it can't tackle in budget reconciliation through executive action and future legislation. But the prospects for these follow-up changes are also shaky: There's limits on what the White House can do on its own (and potential lawsuits to overcome) and major follow-up legislation is unlikely to pass, since it would require Democratic support in the Senate.
What happens if the House doesn't pass the bill?
If the House bill is defeated or withdrawn from a vote, Republicans will have some hard choices to make. The White House is refusing to even entertain that notion for now.
"We're not looking at a Plan B," White House spokesman Sean Spicer told reporters on Wednesday. "We have Plan A, it is going to pass, we are going to go from there."
Trump warned House Republicans on Tuesday that they could lose their majority in 2018 if they fail to pass a health care bill.
Conservatives are hoping a failed vote would force Republican leaders to make fundamental changes to bring them on board, but then moderates would have the same demands from the other direction. It's possible Trump and GOP leaders conclude there's no viable bill that can unite the party for now and move on to their next priority, tax reform.
Trump himself has said in speeches that he was ambivalent about taking on health care and his initial instinct was to wait for Obamacare to encounter problems down the line that would force Democrats to come to the table.