Senate Republicans Release Updated Discussion Draft of ACA Repeal Bill

Posted in Legislative Updates

On Thursday, June 22, 2017, Senate Majority Leader Mitch McConnell of Kentucky released a 142-page healthcare “Discussion Draft” of legislation, called the Better Care Reconciliation Act of 2017 (BCRA), which is the Senate version of the Affordable Care Act (ACA) “repeal-and-replace” legislation American Health Care Act (AHCA) passed by the U.S. House of Representatives last month.  An updated “Discussion Draft” of the BCRA was released on June 26, 2017 with the intention of calling for a vote on the bill before the Fourth of July recess. However, Senator McConnell had to delay that vote after it became clear that it would not get the 51 votes required under the Budget Reconciliation rules to pass.  A further updated Discussion Draft of the BCRA was released on July 13, 2017.  A summary of the updated July 13 draft of the BCRA by the U.S. Senate Committee on the Budget is available here and a section-by-section summary of the July 13 version is available here and here

The July 13 Discussion Draft largely mirrors the previous draft and its primary revisions are unlikely to have a significant impact on employer-sponsored group health plan coverage.  The revisions to the BCRA in the July 13 Discussion Draft are intended to garner enough support from certain key swing votes by senators who previously expressed reservations about supporting the prior version after the Congressional Budget Office previously reported that it would leave 22 million more uninsured by 2026 than under the ACA while providing tax cuts to the wealthy.  Primary revisions in this most recent version include:

  • Addition of a provision that would allow people to use their health savings accounts (HSAs) to pay for individual market health coverage to the extent that premiums exceed any tax credit amounts allowed under the law;
  • Revisions to keep the 3.8% net investment income tax and 0.9% Medicare payroll tax, which previous versions had proposed repealing;
  • Additional funding for state-based reforms that are intended to help cover out-of-pocket costs and additional funding for opioid programs;
  • Addition of a provision that would allow all individuals purchasing health insurance in the individual market the option to purchase a lower premium catastrophic plan (that covers at least 3 primary care visits a year) effective plan years beginning on or after January 1, 2019 and allow individuals to use premium tax credits towards the purchase of such catastrophic plans; and
  • Addition of a provision developed by Senator Ted Cruz (R-TX) that would allow insurers to offer non-Exchange plans that do not comply with many of the ACA mandates so long as the insurer offers “sufficient minimum coverage” through a public Exchange that remains subject to federal mandates in the ACA.  Because the policies that meet the ACA mandates would likely attract individuals with adverse health conditions, the bill would create a fund to make payments to insurers for the costs of covering high risk individuals enrolled in such plans. 

Except for the taxes noted above and the “Cadillac” tax on high-cost employer-sponsored coverage, which would be delayed through 2025, the updated Senate bill would repeal virtually all of the tax increases imposed by the ACA, including the individual and employer mandates, effective as of January 1, 2016.