Politico

New details in GOP Obamacare replacement leaked

Written by Lisa

House Republicans aren’t backing down from their Obamacare repeal plan that sparked backlash from the party’s conservative wing.

The latest version of the House’s Obamacare repeal bill — which has yet to be publicly released — contains few significant changes to a previously leaked draft, according to documents obtained by POLITICO.

The bill still includes new tax credits for individuals based on age, a proposal that hardline conservatives derided as “Obamacare lite” after POLITICO published a previous version of the draft legislation last week.

However, one significant change to the tax credit is being considered: not allowing wealthier Americans to qualify for assistance. No specific proposal for cutting off eligibility has been added to the legislation, but staff have been directed to come up with possible proposals, according to a source familiar with the deliberations.

The latest draft, dated Feb. 24, also still includes a plan to phase out Obamacare’s Medicaid expansion. Instead the program’s current open-ended federal entitlement would be replaced by capped payments to states based on the number of Medicaid enrollees.

Republicans are still divided about several key provisions, and the bill is likely to undergo changes before being publicly released. Spokesmen for the relevant House committees declined to comment or did not respond to requests for comment.

The proposal also still includes plans to eliminate Obamacare’s taxes. Revenue would be generated by capping the tax exemption for employer-sponsored plans at the 90th percentile of current premiums. That means benefits above that level would be taxed.

Perhaps the biggest change in the latest draft is removing a section that would have allowed “grandmothered” plans to remain in the market indefinitely. Those are plans that were in existence when Obamacare was fully implemented in 2013, but that didn’t meet the coverage requirements of the law. Following an outcry about canceled plans, the Obama administration gave states the option of keeping them in place through 2017. The Trump administration announced last month that it was extending that deadline by another year.

There is also a change to the “state innovation grants” that Republicans are proposing to help states stabilize the individual health insurance market. The latest version of the bill creates a default “reinsurance” fund for states that fail to take advantage of the grants, which is similar to a program in the Affordable Care Act. Under the new proposal, insurers would be reimbursed for expensive customers with medical claims that exceed $50,000, with a cutoff point of $350,000.

The newer draft also tweaks eligibility for the tax credit that Republicans are proposing, which would range from $2,000 to $4,000 depending on the beneficiary’s age. It adds a verification process for employed individuals to show that they don’t have access to coverage through their jobs and therefore qualify for the tax credits.

GOP leadership’s decision to prohibit wealthier Americans from receiving tax credits could assuage some Republicans’ concerns about creating a new benefit for rich people.

“I’m not real eager to be providing tax credits to the Warren Buffetts of the United States,” said Sen. Susan Collins (R-Maine) in an interview this week. “I have a real problem with an open-ended tax credit for insurance that would go to very wealthy individuals.”

Republicans have been badly divided about how to move forward with repealing and replacing Obamacare, despite seven years of campaign promises to scrap the law. House Republicans are expected to begin marking up the repeal legislation next week, and Speaker Paul Ryan on Thursday said the House will vote on a plan within three weeks.

No bill has been publicly released yet. Democrats have criticized Republicans for writing their plan in secrecy.

Burgess Everett contributed to this report.

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