Last Thursday, the House of Representatives passed a new healthcare bill, the American Health Care Act, with a final vote of 217-213 —all the Democrats and just 20 Republicans were against the bill. Despite the close vote, the four point difference was just enough to push the bill onto the Senate where there will be further debate and eventually a final vote that will either kill the bill or pass it, leaving it up to the president to make the bill a law (the veto process is a different story).
This specific bill that was passed on May 4 has caused some murmurs in the healthcare universe, because it's main job is to repeal and replace former President Obama's Affordable Care Act (ACA), a law that has been in effect for about three years. Also known as Obamacare, this law's purpose is to provide all Americans with affordable healthcare while reducing spending and regulating the healthcare industry. Consequently, the Republicans have now passed a bill in order to replace this Democratic law.
So what are the new changes to the law?
1. Eliminates Obamacare taxes on the wealthy
Obamacare originally had taxes on the wealthy class, the medicine industry and the insurance industry. The new Republican bill eliminates this entirely, and these tax cuts add up to approximately $883 billion dollars.
2. Medicaid Funding given (into a block grant) to the states
The federal money given to the states for Medicaid is now given as an option to turn the money into a block grant. States now have the power to change the requirements for Medicaid based on a fixed amount of money the federal government gives them annually, meaning the program is no longer open-ended based on who needs it.
3. Flip flop on the subsidy system — tax credits would be more so based on age (not income)
The ACA had a system of tax credits that were based on income, but now, the American Health Care Act (AHCA) would base the system off age. The older the person got, the more the tax credits would increase.
4. Insurances can charge higher premiums on the old folks.
States would receive waivers allowing insurers to charge older people as much as they want to.
5. Goodbye Individual Mandate
The ACA has a provision that taxes those who do not have healthcare and businesses/employers who did not offer healthcare to their employees. The new AHCA scraps that provision completely.
6. States can opt out of an essential Obamacare requirement...
...which covered everyone at the same rate (regardless of "pre-existing conditions"). Now insurers no longer have to cover the "essential health benefits." Does not matter what it is if you have had the condition for a while now, everyone can be charged at the same rate regardless of how healthy or unhealthy you are.
7. Instead, the AHCA would require states to set up high-risk pools to try and help those who are uninsured get coverage.
There are also people who are uninsured and have serious sickness. In that case, the AHCA is requiring states to set up high-risk pools to help those people get coverage to help get treatment. The federal government would provide $8 billion to help states set up these pools. Some suspect that this provision is only to help the bill pass through Senate, especially if states do decide to apply to receive this funding, the $8 billion would not take the program too far.