13 Million People Would Lose Their Health Insurance Under Senate Tax Bill

Red AlertYesterday afternoon, the Senate released a tax bill that would eliminate the penalty for not having health insurance established under the Affordable Care Act (ACA). The non-partisan Congressional Budget Office (CBO) estimates that repealing the individual mandate would cause 13 million people to lose their health insurance by 2027, including 4 million in the first year alone.

Without the individual mandate, younger, healthier people would lack incentive to purchase health insurance and would exit the individual market. This means that the people that remain in the individual market will be older, in poorer health, and require more expensive care, which will increase premiums. The CBO estimates that premiums would increase by about 10 percent in most years between 2018 and 2027, which could make it more difficult for people to afford health insurance in the future.

Congress could vote on this bill as early as tomorrow. Please call 202.224.3121 and tell your member of Congress to vote no on this bill that could hurt millions of people’s access to health care. You can choose to be connected to your Senator or your Representative.

Information on New York Targets:

  • Representatives Zeldin, King, Donovan, and Stefanik have all said that they will vote “NO.” Please thank them and encourage them to stand strong!
  • Representatives Faso, Tenney, and Katko are leaning toward voting “NO.” Please help push them to a definitive “NO” vote.
  • Representatives Collins and Reed are supporting the bill.

PreschoolersGuest post by Ben Anderson, Director of Health Policy at Children’s Defense Fund-NY. Here we are 39 days and counting since the September 30th deadline for Congress to fund the Children’s Health Insurance Program (CHIP), and yet families of the 350,000 New York children who depend on CHIP for coverage are still waiting for Congress to act. Sadly, once again children are being held hostage to political debates.

Created specifically for children, CHIP’s benefits and provider networks are designed to ensure children in working families who are not eligible for Medicaid have access to child-appropriate services, providers, specialists, and facilities. Despite bipartisan support for a strong, five-year extension of CHIP in both the House of Representatives and the Senate, debate continues about how to pay for CHIP and the extension of other important health programs.

Last week, the House of Representatives passed the Championing Healthy Kids Act, a bill that includes the same strong, bipartisan five-year extension of CHIP that the House Energy and Commerce and Senate Finance Committees approved and that most child health advocates strongly support. However, the bill passed by the House pays for the extension of CHIP and other critical health programs for vulnerable populations with offsets that would cause undue harm to children and families. These provisions passed over the objections of many in the House and are jeopardizing the bill’s passage in the Senate.

The sad irony is that Congress is bickering over how to fund CHIP and other programs in the bill, when the total cost for these programs is merely 1% of the amount Congress will add to the deficit to provide tax cuts to the wealthiest individuals in America. The senselessness must end. We’re so close to the finish line. There is bipartisan support for CHIP. Senate and House members, Republicans and Democrats alike, agree on what we need to do for children’s health. Congress needs to finish its homework and reach a bipartisan consensus on funding CHIP.

numbersYesterday, the House of Representatives adopted a budget resolution that paves the way for the federal government to approve up to $1.5 trillion in tax cuts to wealthy people and corporations with only Republican votes.

What’s a budget resolution?

A budget resolution is a piece of legislation that outlines the congressional budget. It establishes how much the federal government is allowed to spend and in which categories (for example, transportation) and how much they can increase the federal debt or deficit. The resolution can also include budget reconciliation instructions, which allow the House of Representatives and the Senate to pass budget-related measures with fewer votes and without filibusters from opponents.

The budget resolution just passed includes reconciliation instructions, which means that Republicans, who have majorities in both houses, could pass major tax legislation without the support of their democratic colleagues. Democrats who disagree with the tax legislation would also be very limited in their ability to delay or stop the vote.

How is this related to health care?

Any tax cuts will eventually have to be paid for. The budget resolution that ultimately passed did not specify which programs would be cut in order to pay for the tax legislation, but an earlier version of the budget resolution introduced in the House gives us a pretty good idea of what the cuts might look like. This earlier version of the resolution called for $5.8 trillion over 10 years in cuts to programs that help low- and moderate-income families. This included a devastating $1.8 trillion in cuts to Medicaid, Medicare, and other health care programs, which would hurt millions of children, families, and seniors.

What does this mean for consumers right now?

Nothing yet. The budget resolution is a set of guidelines. It will not be submitted to the President, and it does not have the force of law. However, Congress is planning on releasing formal tax legislation as early as next week, which if passed by both houses, would affect consumers beginning in 2018.

Check back with HCFANY in the coming weeks for updates on the budget and other federal health care policy issues.

UrgentAlthough it has no immediate effect, the executive order the President signed yesterday morning instructs several federal agencies to consider proposals that could destabilize the individual insurance markets established under the Affordable Care Act (ACA).

The executive order instructs relevant agencies to propose regulations that would:

  • Expand the use of association health plans, which allow small businesses to group together to purchase health insurance;
  • Allow more people to enroll in short-term limited duration insurance, which are exempt from ACA consumer protections, for longer periods of time; and
  • Allow the sale of health insurance across state lines.

The expansion of association and short-term limited duration health plans would both create loopholes for younger, healthier consumers to purchase one of these plans instead of plans offered through the Marketplace. If younger, healthier people leave the Marketplace, premiums will rise for consumers that remain and may become unaffordable.

Selling insurance across state lines presents a different problem, especially for states like New York. New York has worked really hard to pass insurance regulations that protect consumers. Insurance sales across state lines would essentially allow insurance companies to choose their regulators, which would make insurance less available and less accountable to the needs of New Yorkers and consumers across the country.

If federal agencies do propose these rules as the President instructs, there will be an official notice of proposed rulemaking and at least a 30-day comment period before any new regulation would go into effect. It is therefore unlikely that any changes will take place before 2018.

This does not affect the upcoming open enrollment period, which will begin on November 1. If you or someone you know needs help enrolling in health insurance, please call (888) 614.5400 for in-person assistance in your area. Don’t forget, consumers enrolling in Medicaid, the Essential Plan, and Child Health Plus can enroll year-round.

You can check out additional resources on the executive order here.