Right now there are three primary possibilities for the ACHA tomorrow:
1) No vote is taken as more wrangling and tweaking occurs
2) Vote fails as the combination of Tuesday Morning Group Republicans and the House Freedom Caucus vote against the bill from both ends of the Republican caucus. This is where we were most likely to have been at at 1800 EST on March 22, 2017
3) ACHA advances as the House Freedom Caucus gets a major policy concession, the elimination of Essential Health Benefit requirements.
#3 is what I want to discuss. It would produce a massive cluster. The bill needs to go through the Senate as a reconciliation bill with several significant requirements. One of those requirements is the items are germane to the budget. Since the other parts of the bill have stripped the link between premiums and subsidies, lower premiums are not germane to the budget. It will get stripped.
More importantly, the optics will look ugly. The Congressional Budget Office
If there were no clear definition of what type of insurance product people could use their tax credit to purchase, some of those insurance products would probably not provide enough financial protection against high medical costs to meet the broad definition of coverage that CBO and JCT have typically used in the past—that is, a comprehensive major medical policy that, at a minimum, covers high-cost medical events and various services, including those provided by physicians and hospitals.
IF Essential Health Benefits are dropped from the bill, the CBO will project that insurers will respond by offering very skinny benefit packages (no maternity or substance abuse inpatient services for instance as both qualify as high cost events) that are targeted to be priced at precisely the subsidy value. If there is no regulation as to what a carrier needs to include with a given maximum out of pocket requirement, two things will happen. A lot of people who otherwise would not use their subsidy would use their subsidy. And most people who are buying mostly on price will be buying policies that the CBO does not deem to be insurance.
Jed Graham has been bird-dogging this angle hard:
Because the GOP bill would mostly retain ObamaCare coverage rules, insurance would be unaffordable for lower-income and older adults with the new, smaller tax credits on offer, so some 30 million people wouldn’t claim the GOP tax credit averaging $3,000 in 2020 and rising with inflation. That would add up to more than $600 billion in unclaimed subsidies through 2026, or roughly the same $600 billion amount by which House Speaker Paul Ryan’s plan cuts taxes. Those unspent subsidies go a long way to explaining why CBO found that the American Health Care Act would reduce deficits by $323 billion over a decade.
So the end result if Title 1 is the price of passage is the following:
- Guarantee failure in the Senate
- Adds to the deficit immediately
- Adds millions more people to the ranks of the uninsured as defined by the CBO over and above the 24 million that is the current score
/Dave Anderson +3
And it looks like Option #3 is on the table