Casual Reading: The American Health Care Act

Today was a busy day for this diligent agent.  Up early to get a head start on work for the week.  Headed out in a rush to get to my appointment in Fontana with an Automotive Manufacturer of 1/16 scale cars, trucks, etc from all genres and interests.  After a heavily creative and detailed meeting showing every possible option under the sun to help them save money and avoid the 25.57% rate increase they were offered by their current insurance carrier.  All said, the meeting went great and now they’ll sort it all out and try and make the best decision of the 3 best options discussed.

Back to Burbank I go…

I got back to the office in time to cram a quick lunch into my face as I have a meeting in my office with my Kaiser rep to discuss some upcoming renewals, trends in the industry from their perspective and get the latest pitch on why they think they are the best option for businesses (which in some ways they are…it just depends on if you’re into them or not).  Great news is the rate increases they’ve delivered are minimal in comparison to the ones I’ve been getting the past 6 months from all of the other carriers, so I’m very grateful to have spent this time with Kaiser, for sure.

Next (which consumes the rest of my day and evening) is to read, highlight and digest the new bill to
repeal and replace the Affordable Care Act.  The Republicans plan, the American Health Care Act (AHCA) is a lot smaller in it’s volume of pages compared to Obama’s 2,000+ page initiative back in 2010 (thank goodness for that).  After skimming the American Health Care Act, it’s small because it doesn’t seem to change much from what we had before the Obama plan.  Some of the Affordable Care Act features do remain in spirit while others are completely repealed.

Trump’s American Health Care Act

Removal of Mandates & Tax Breaks: One of the main features to the AHCA has to do with tax/penalty mandates.  The new plan expects to help a lot with tax benefits to individuals who buy healthcare coverage with “after-tax” funds.  It would waive the mandate for an employer to offer coverage to their employees putting the decision back into their hands instead of forcing them to buy plans (which in many cases were base-coverage plans that really just barely met the minimum essential requirements listed in the law).  Some of the ACA taxes will remain in place for 1 year as the plans transition.  Also, the AHCA, unlike Obamacare, does not mandate that all Americans be covered by health insurance or pay a fee.

Medicaid: The Medicaid initiative (which, if qualified, benefits lower income households to aid in getting health coverage) will stay the same as it is until at least 2020, and then be reassessed to see if it needs adjusting.

No Annual & Lifetime Limits: No change to this rule for insurance carriers. Carriers must still offer unlimited coverage for all expenses in an insureds calendar year and lifetime.

Children up to Age 26: the AHCA will continue to allow kids to stay on their parents’ plans until they’re 26.

Pre-Existing Conditions: Instead, it has a different way of penalizing people who decide to remain uninsured: requiring those who don’t maintain “continuous coverage” to pay a hefty fine when they want to reenter the insurance market.

Here’s an example of how it will work: If a worker goes straight from insurance at work to buy their own individual policy, the insurance company has to charge the buyer a standard rate — it can’t take the cost of the buyers condition into account.

But if the buyer has had a lapse in coverage longer than 63 days — and went to the individual market later, insurers could charge the buyer a 30 percent premium surcharge. The buyer would need to pay that higher premium for a full year before returning to the standard rate.  This surcharge would be the same for both healthy and sick people; insurers could not use it to turn away people they expect to have significantly higher medical costs.

Premiums for Older Individuals: Another piece to the AHCA addresses the rate differences charged to each age group.  The ACA currently restricts how much insurers can charge their oldest enrollees in the small business and individual market. It says that insurers can only charge the oldest enrollee three times as much as the youngest, which pushes down premiums for those in their 50’s and 60’s. The AHCA would get rid of that regulation, allowing insurers to charge all enrollees whatever they underwrite that age category to be needed charged.

No Taxes on High Cost Health Plans: Currently known as the “Cadillac Tax” which as of now was expected to take effect in 2020 and was intended to help pay for the subsidization of insurance costs for the lower income group will not exist at all.

That’s a quick and simple look at what I’ve read.  I’m confident that more details will become aware to me about the American Health Care Act as things move along just as it was with the Affordable Care Act in 2010.  We shall see…

Super-Agent out.