Senate Health Care Bill and Michigan’s Trigger Clause

On June 22, Senate Republican leaders released their version of a bill to repeal and replace the Affordable Care Act (ACA). Below are the main provisions of the bill

  • Phases out Medicaid expansion beginning in 2021 and restores it to pre-Affordable Care Act levels by 2024 (limits government spending on Medicaid, giving states a set amount to spend per person rather than the ACA’s current open-ended funding.) 
  • Keeps the provision that people under 26 can get insurance through a parent’s plan or buy it independently 
  • Allows older people to be charged up to five times more than younger people on the health exchanges
  • Insurance companies would be required to accept all applicants regardless of health status. However, it would allow states to ask permission to reduce required coverage which would give insurers some discretion over what they offer in their plans. If a benefit is no longer classified as essential, insurers could impose annual and/or lifetime limits on what they spend on patients for that benefit
  • Cuts to Obamacare tax credits, but keeps age, geography and income as factors
  • Defunds Planned Parenthood for one year
  • Eliminates employer mandate for providing insurance
  • Does not allow tax credits for plans that cover abortion
  • Repeals the ACA’s taxes on corporations and the wealthy that pay for insurance subsidies
  • Repeals the individual mandate and instead adds a six-month waiting period for those who want individual coverage but have had more than a two-month break in coverage in the last year

Overall, the plan benefits people who are healthy and high-income and disadvantages those who are sicker and low-income, with people between the ages of 50-64 disproportionately impacted. While federal funding for Medicaid expansion phases out between 2021-2024, Michigan has a trigger clause which makes the expansion end immediately if federal funding goes below the ACA promised rates, which would trigger an end to Michigan Medicaid expansion sooner.

The Congressional Budget Office (CBO) found that the health care bill would increase the ranks of uninsured by 22 million over a decade. The report projected only a slight difference in impact between the measure that GOP Senate leaders wrote and the plan the House passed last month. They also found that while average premium rates would drop, out-of-pocket costs would rise because plans would cover fewer services and have higher deductibles.

Senate Republican leaders announced on Tuesday they are delaying a vote on the bill until after the July 4 recess after it appeared they lacked the votes to begin debating the legislation. Senators Rand Paul of Kentucky and Ted Cruz of Texas are pushing to move the bill further to the right, while other Republican senators appear to be reluctant to vote for a plan that results in steep coverage losses and cuts to Medicaid.

You can find a chart comparing the Affordable Care Act, the House plan and the Senate plan here.

Sources: The AtlanticCongressional Budget OfficeNPR, The Washington Post