News analysis: ‘Obamacare’ vs. the GOP’s new plan
I have been holding off on writing a column on the new health plan being worked on in Congress, hoping the provisions would become easier to understand and there would be less of them. It doesn’t look like that is going to happen, so I’m going to do the best I can to give you an overview as it now exists in its pending form. I will refer to Obamacare as ACA and the new plan as the GOP plan because that’s what the media outlets are calling it.
Beginning with Jan. 1, 2017, the GOP plan eliminates the tax penalties that the ACA has imposed on individuals who choose not to buy health insurance, along with all employers with 50 or more full-time workers who do not offer health insurance to their employees. Unless the GOP bill becomes law quickly, those filing their 2016 tax returns will still be subject to the penalty. This is one of the reasons the bill is being rushed through Congress with the hope it will pass both houses by the first of April.
The GOP bill will cover pre-existing conditions, but since the penalties on the individual mandates will have been eliminated, any individuals who wait until they need care to buy it could end up paying a 30 percent higher premium for the first year in lieu of that penalty.
The expansion of Medicaid will be phased out. The ACA expanded eligibility from qualified low-income families, pregnant women, children and the disabled to all individuals under the age of 65 who earn up to 138% of the federal poverty level which is about $16,643 for an individual, but only in states that opted for the expansion. The federal government now pays at least 90% of the these costs. Once those beneficiaries leave the Medicaid rolls, this funding stops and states would be given a set amount of money based on the number of enrollees they had in 2016.