Congressional attempts to “repeal and replace’’ the Affordable Care Act met with failure after failure this year.
But early Wednesday, Senate Republicans passed a bill that would abolish a central tenet of the ACA: the individual mandate for Americans to have health coverage or face a tax penalty.
The mandate repeal is part of a massive tax overhaul that the Senate passed on a party-line 51-48 vote. The bill returned to the House on Wednesday to resolve minor procedural flaws in the version already passed by that chamber, and was approved again.
Lawmakers used the tax bill to undo part of the ACA because the U.S. Supreme Court, in upholding the health law in 2012, defined the individual mandate as a tax.
President Trump heralded the Senate action in a tweet: “The United States Senate just passed the biggest in history Tax Cut and Reform Bill. Terrible Individual Mandate (ObamaCare) Repealed.”
Both U.S. senators from Georgia, Republicans Johnny Isakson and David Perdue, praised the passage of the legislation, calling it “historic.”
The repeal of the insurance mandate would take effect in 2019.
The idea of compelling people to have health insurance has been the most unpopular part of the ACA, and Republicans have regularly attacked it. Yet ACA proponents have noted that the concept was originally floated by some conservatives, and it became law in Massachusetts under Republican Gov. Mitt Romney before it became part of the federal Obamacare legislation. The idea generally was to support the financial viability of the health care system by having more people insured.
The Congressional Budget Office has estimated that repeal of the mandate will mean 13 million fewer insured people by 2027. That would translate to an estimated 200,000 to 250,000 Georgians, said Bill Custer, a health insurance expert at Georgia State University.
Georgia already has one of the highest uninsured rates, at 14 percent.
The repeal is also expected to raise premiums by 10 percent each year more than they otherwise would rise.
The 13 million would include many middle-class, older Americans who get insurance on their own but don’t qualify for subsidies in the exchange, and would face even higher premiums than current rates, Custer said Wednesday.
Also dropping insurance would be many younger, healthier Americans, he predicted. Many such people would skip buying coverage, as happened before the ACA was passed, because they think their likelihood of needing it is low.
Repealing the insurance requirement may induce some people who are offered employer-based coverage to reject it, Custer added.
The ACA insurance exchanges eventually “will look much more like Medicaid managed care,’’ he said.
Meanwhile, the No. 2 Senate Republican, John Cornyn of Texas, said the tax bill would make the Obamacare “unworkable,” which he hopes will force Democrats into negotiations to replace the law, Bloomberg News reported.
“Arguably, doing away with the individual mandate makes the Affordable Care Act unworkable — not that it was particularly great beforehand,” Cornyn said. “Hopefully this will precipitate the bipartisan negotiation on what we need to do as an alternative.”
Republicans are considering another effort to repeal and replace the broader law next year, but presumably will have one fewer vote to do so after Democrat Doug Jones won the Alabama Senate special election.
Aside from repeal attempts, the Trump administration has killed some subsidies for the insurance exchanges, cut the enrollment period in half, and drastically reduced the Obamacare marketing campaign.
“It’s wounded,” said Jon Kingsdale, who ran the Massachusetts health exchange, the prototype for Obamacare, Politico reported. Yet he and other policy analysts noted that the basic framework of the ACA — the online marketplaces, the consumer protections, the subsidies that help millions afford insurance — remain in place, as does Medicaid expansion, which brought insurance to about 12 million newly eligible people. (Georgia, like some other states, has not expanded Medicaid, with officials saying it would be too costly).
As long as that core survives, the ACA can be rebuilt, Kingsdale said, should such a political moment arrive, Politico reported.
Laura Colbert of the consumer group Georgians for a Healthy Future, which supports the ACA, said Wednesday that the repeal of the individual mandate “exacerbates the problems that consumers are already facing in the insurance market, namely rising premiums and a limited choice of insurers. Instead of enacting policy that will result in fewer people with insurance coverage and higher costs for those that remain insured, our elected officials should be focused on how to cover more people more affordably.”
Because the mandate repeal doesn’t take effect until 2019, insurers would have time to raise rates to account for the extra risk, or withdraw from the ACA market, as many have already done, the Wall Street Journal reported. Health insurers, an overwhelmingly domestic industry, will reap enormous benefits from the tax bill’s sharp cut to the corporate rate. Analysts project that the companies initially could see sharp increases in earnings.
Meanwhile, some experts caution that the tax legislation will have big downstream effects on funding for Medicare, Medicaid, ACA subsidies and other federal and state health care programs. That’s because the projected $1.5 trillion increase in the federal budget deficit resulting from the tax cuts would put pressure on Congress to slash health care spending, Modern Healthcare reported.
There are two ACA stabilization bills on the table that aim to stabilize health insurance markets and lower premiums. But their fate is unclear, as is extending funding for the Children’s Health Insurance Program, known as PeachCare in Georgia, which covers 177,000 kids here.