ACA UPDATE: House of Representatives Approves AHCA

Compliance, Employee Benefits

Bill moves forward to Senate

On Thursday, May 4th, the House of Representatives approved legislation which is designed to alter the existing Affordable Care Act (ACA). The American Health Care Act (AHCA) was approved by a 217-213 vote and will now move to the U.S. Senate for review.

This version of the AHCA is similar to the version offered in March with two key amendments. Those amendments are:

The MacArthur Amendment which allows 10-year state waivers for the following items:

  • Higher ratio for age-based premium ratings in the individual and small group markets beginning in 2018.
  • Establish different essential health benefit requirements for coverage in the individual and small group markets beginning in 2020.
  • Allow states with high risk pools to engage in health status underwriting who have not had continuous coverage for the past 12 months.

The Upton Amendment appropriates $8 billion for the period between 2018 and 2023 for states with health status underwriting waivers as defined in the MacArthur Amendment.

Highlights for employers in this legislation include:

  • Reduction in Employer Mandate penalties to $0.
  • Pushes back the implementation of the Cadillac Tax to 2026.
  • A loosening of the rules for Health Savings Account allowing for larger contributions.
  • Repeals a number of fees and taxes including the annual provider fee, the net invest income tax, the prescription drug tax and the medical device tax.

Key Takeaway

Today’s approval by the House of Representatives moves the bill to the U.S. Senate for their approval. It is important to remember that this legislation will need to go through the normal scrutiny of the legislative process in the Senate and changes to the bill are entirely possible. M3 will provide you with further updates when major changes are made to the bill or steps in the legislative process occur.

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