Republican senators are expected to unveil a healthcare bill Thursday that they have been working on behind closed doors for several weeks that would roll back Obamacare-created taxes, change the Medicaid program and include more generous tax credits to help people purchase private coverage.
Several senators told reporters Wednesday that they had not seen the bill, but a version is expected to be made public Thursday morning and voted on by next Thursday ahead of the Fourth of July recess. The bill would mirror some of the provisions of a bill the House passed in May, called the American Health Care Act.
Most senators were tight-lipped about the bill’s content, and others have said they are exasperated by the way that leadership has hidden it from public view, but here is some of what the Washington Examiner has been able to learn so far:
State waivers
States are likely to have options to ease current mandates on the kinds of health insurance plans that can be sold. Under the House version of the bill, states have the option to waive out of Obamacare protections that require insurers to charge the same amount in premiums for a healthy or unhealthy person, a mandate called community rating.
This provision was controversial, with critics saying it would not result in adequate coverage protections for people with pre-existing illnesses.
The Congressional Budget Office also concluded that allowing waivers from community rating would result in plans that are prohibitively expensive for people with complex medical needs. Portions of the insurance mandates are likely to be left up to the states, but senators have indicated that this particular protection will remain.
“More discussion has been around how you are structuring plans and to what extent the states could opt in or out,” said Sen. Thom Tillis, R-N.C. “These are a couple of the open switches that will be discussed today and tomorrow.”
Sen. John Thune, R-S.D., the third-ranking GOP senator, said that there will be some waivers but said no final decision has been made on community rating.
Tax credits
The bill is expected to differ drastically from the House-passed legislation on tax credits to help people pay down health insurance costs.
The AHCA pegged a tax credit towards age, with older people getting more money than younger ones. But concerns arose that the tax credit structure could harm low-income seniors since the AHCA lets insurers charge seniors more for plans.
So the Senate bill is likely to be more generous and have a tax credit structure with a mix of age and income.
Sen. Rand Paul, R-Ky., believes that the tax credits will be based on “mostly income.” The tax credits are major sticking points with conservatives such as Paul in part because they closely resemble the income-based credits used by Obamacare.
“Everything I hear sounds like Obamacare lite,” Paul said on Wednesday.
But Tillis said that such changes may be necessary to offer more generous credits in order to provide people on these plans with options that wouldn’t drastically change what they’re used to.
“What we are talking about is transition … we have to look at these soft-landing strategies, most importantly for the insured population but also to a second degree to the states,” he said.
President Trump recently urged key GOP senators to make the healthcare bill less “mean” than the House bill and has previously suggested more generous funding, though it’s unclear whether he meant through tax credits or another measures.
Currently people who earn 400 percent above the federal poverty level are eligible to get a tax credit. The Senate bill is expected to lower that threshold to 350 percent in 2020, according to a report in the Washington Post.
Tax Penalties
The bill is expected to undo Obamacare’s taxes and penalties including the employer mandate, the individual mandate, the medical device tax and possibly the Cadillac tax on high-cost health plans. The taxes may be suspended or delayed instead of repealed, however, if the Senate needs to find ways to pay for the healthcare plan.
Abortion
The House-passed AHCA aimed to defund Planned Parenthood and also apply stricter anti-abortion language to tax credits.
The AHCA sought to tie tax credits to pay down health insurance with restrictions similar to the Hyde Amendment that prohibits certain federal funding from going towards abortion.
Several senators said, however, that the Senate parliamentarian advised that the tax credit structure doesn’t meet the rules for reconciliation.
However, the parliamentarian can be overruled or be ignored by the president of the Senate, who is Vice President Mike Pence.
Tillis said he expects the Senate will find a workaround.
“It would not be in the direct sense it was proposed in the House, but I think there are ways to address most of the concerns of members,” he said.
A draft obtained by the Washington Post would strips funds for Planned Parenthood. That could be a problem for some Republican centrists, as key votes Susan Collins of Maine and Lisa Murkowski of Alaska both support funding for the women’s health and abortion provider.
Medicaid expansion
Senate leadership is still tussling with centrists over how long to leave in place Obamacare’s Medicaid expansion. Centrists are favoring a seven-year phaseout of the expansion after 2020, while leadership prefers three years.
Even though the bill text is expected to emerge Thursday morning, Sen. John Cornyn, R-Texas has said no resolution has been made yet.
“We will have the solution tomorrow morning sometime,” he said.
Thune told reporters that the phase out will likely be closer to the seven-year figure but wouldn’t elaborate on how close.
Medicaid structure
The Senate bill is expected to change the structure of Medicaid from open-ended to a fixed sum each year through a per-capita cap, which caps federal Medicaid spending per beneficiary.
However, there are still lingering questions over how the cap would be structured, most notably at what time it would be set.
Republicans have long sought to make changes to the program because they say its funding is unsustainable.
Cost-sharing reduction subsidies
The federal payments, which help insurers offer lower out-of-pocket costs to consumers, are not expected to be included in the Senate bill. Tillis told reporters that he believes they will need to be included later as part of a bipartisan solution.
