Break down of the AHCA draft HOUSE bill
The House Bill preliminary draft of the Trump Administration’s American Health Care Act (AHCA) is out this week. Here’s the Sorin Group’s interpretation of what’s IN and what’s OUT of the AHCA draft based on various media outlets and Congressional sources.
- CADILLAC TAX – the tax on benefit-rich, expensive health plans will be pushed out to 2024
- MANDATES – Individual and employer mandates and their associated penalties for non-adoption eliminated
- TAXES – on medical devices, OTC drugs, certain prescriptions, health insurance carriers and health insurance premiums eliminated (all of these are passed on to you, the consumer)
- MEDICAID EXPANSION – as developed under Obamacare would be transitioned to a “per capita allotment” determined at the State level but not until 2020
- ACA SUBSIDIES eliminated and replaced with TAX CREDITS (see below)
- ELECTIVE ABORTIONS – health care coverage for elective abortions eliminated
- TAXATION – Employers who provide high-end health plans to their employees (i.e. low deductibles, high co-insurance, low Rx co-pays), will be heavily taxed under the AHCA. Why? According to the IRS, tax-favored employer plans account for potentially $4 Trillion in lost tax revenue. Both sides of the aisle agree they’d like to “tap” into some of that lost payroll tax revenue to help fund portions of the AHCA. But how?
- PATIENT PROTECTIONS – Continue to prohibit health insurers from denying coverageor charging patients more based on pre-existing conditions. Continue to allow dependents to stay on their parents’ plan until age 26.
- TAX CREDITS – providing a monthly tax credit between $2K- $14K per year to low and middle-income earners who do not get insurance through the government or an employer.
- PATIENT and STATE STABILITY FUND – will provide states with $100 billion to design programs that meet their patient population’s needs and help low-income Americans afford coverage.
- CONTRIBUTIONS – caps on FSAs and HSAs put in place by Obamacare would be raised significantly to allow for more pre-tax, consumer-driven healthcare spending
- COMPETITION – between insurance carriers and across state lines
- TANNING – Here’s something we can all get behind….smiley face. Obamacare imposed a 10% sales tax on indoor tanning services, but this tanning tax will be repealed.