Why is Repeal of the ACA So Scary?
By Minda Wilson,
Author of Urgent Care
Repeal simply means that the requirements of the ACA that were enacted would cease to exist. It would be as if the law was never passed.
Here is what won’t happen if the ACA is repealed!
You won’t lose your coverage if you pay your bill. Insurance is a contractual obligation of the insurance company to provide coverage if you pay the agreed upon rate. If you or your company have entered into a contract for coverage for the year 2017 and the premiums are paid, the insurance company must honor those contracts. Not until it is time to renew, 2018, will your coverage may be terminated or changed.
Penalties. No penalty will be assessed for businesses who did not offer coverage to their employees but were required to under the ACA. It also means that individuals who did not obtain insurance would not be subject to penalties.
What does ACA repeal mean; what are the consequences, for 2017?
It means that restaurants who posted the calories of their double cheese burgers or burritos or of their iced mocha-chinos would no longer be required to provide that information. It means that, in future, the Cadillac tax on high cost, high benefit insurance plans would be eliminated. It means that the affordability requirement in the ACA will also be eliminated. This means that the requirement that plans be standardized will be eliminated. In future rich plans, including low deductible plans, may again be offered; catastrophic coverage may be made available; and businesses will have the right to pick and choose coverage made available to their employees . We will have to say goodbye to the Medical Device Tax and taxes on vaccinations, which should lower the cost of both.
Most importantly, what repeal really means is that a lot of the mess surrounding the implementation ACA would go away.
There would be no more money spent on exchanges and no more exchanges. Billions of dollars wasted each year will end. The administrative nightmare for businesses will go away.
The requirement that every policy provide “Essential Health Benefits” would be eliminated. Men would no longer be required to purchase coverage for pregnancy and women would no longer have to pay to have their non-existent prostates covered for cancer. There would be a return of the opportunity to purchase less expensive, catastrophic coverage as well as the ability to purchase limited coverage for only things you might need.
For 2017, insurance companies have agreed to offer for the entire year all policies they currently make available within the 50 states. In each state an insurance company offers any policy the state’s insurance commission has approved that offering. Once approved and made available, insurance companies cannot change their offerings in a given state. If the state approved the policy you bought providing coverage for your 25 year old son, the insurance company can’t cancel that policy if the ACA is repealed. If the insurance company agreed to provide coverage to any and all individuals despite their pre-existing conditions, they must honor their agreement. If the insurance company agreed to eliminate lifetime caps and/or annual caps, for policies issued in 2017, they cannot take that back. If the ACA is repealed, these benefits could be eliminated in 2018; but for now you are safe.
Federal subsidies that used to be paid to emergency rooms when they saw uninsured patients will be reinstated.
The Downside
Unless the states step up to the plate, the working poor who due to the eligibility expansion received Medicaid would no longer be eligible to receive it.
If your insurance is subsidized and the federal government refuses to pay the subsidy this year, you could lose your insurance. Technically, you are not responsible to step in if the Federal government doesn’t pay or doesn’t pay on time; the insurance companies are supposed to go after the government. It’s a contract and, if all was right with the world, the insurance companies would not punish you for the government’s failure to pay. If the insurance companies cut you off, I envision new highs in awards to those damaged by being denied insurance, when they continued to pay their agreed upon payment. I don’t think juries would be very sympathetic to insurance companies who acted to deny care to people who paid their contracted obligation under their insurance contracts.
For those suffering from drug or alcohol addiction, coverage will no longer be mandated. You could purchase coverage separately; but it is expensive. It is unlikely those who are covered for these problems will continue to receive employer paid coverage.
The really bad news for the government is that all the taxes that were enacted as part of the ACA will be repealed. This is the biggest issue. Assuming the government is contractually obligated for paying the subsidies, there will be no revenues generated to offset these expenses. This could mean a deficit from healthcare subsidies that could exceed a trillion dollars.
The Unknown
Repeal means the “Donut Hole” of Medicare Reimbursement is no longer required to be closed. Therefore, drug reimbursement between $2800 and $6400 is no longer required to be paid by Medicare. It is unclear whether or not the gap will remain closed.
Long Term Implications
The real impact will be felt in 2018. Premium discrimination will return. Rejection for preexisting conditions could also return. Cost will no longer be required to be based only on age, tobacco use and location. Your health history may influence the cost of your plan. There will be no more subsidies. The ability to cover your children up to 26 as well as the restriction on annual lifetime caps on benefits will go away. The elimination of the “Essential Health Benefits” means that physicals, vaccinations, mammograms, etc. are no longer required to be offered for free. The Donut Hole will definitely be re-opened. Insurance companies will be able to rescind policies and we will have limited right to appeal.
The Solution
"The truth is that any state can step up to the plate. They can require any insurance company that does business in their state to offer individual plans at a rate comparable to what business pay. They can enact requirements eliminating lifetime caps on benefits, premium discrimination, or any other of the provisions that their citizens would want continued."
We will just have to wait and see.
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Thanks for this blog, it is very informative and easy to understand. I am not an American, but as a nurse by profession, I pay attention to the issues affecting healthcare.
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