CBO Unveils Revised Analysis of AHCA

On May 24, the Congressional Budget Office (“CBO”) released its estimate of the economic and coverage impact of the American Health Care Act (“AHCA”), the House-passed bill to repeal and replace the Affordable Care Act (“ACA”). While CBO stressed the uncertainty of its estimate given the need to project which states would or would not opt out of certain provisions of the ACA over the next decade, the report highlights the hurdles Republicans must overcome to repeal President Obama’s landmark legislative achievement.

According to the CBO report, 14 million fewer people would be insured one year after passage of the AHCA and 23 million fewer will be insured in 10 years. These numbers alone will make it difficult for Senate Majority Leader Mitch McConnell (R-KY) to muster the 50 votes needed for passage. CBO also estimated the AHCA would cut spending on Medicaid by $834 billion but would increase Medicare DHS payments by $43 billion over 10 years due to a jump in uninsured patients. In addition, CBO stated that premiums will rise in 2018 and 2019, but after that, there will be significant variation depending on whether someone lives in a state that seeks a waiver from certain ACA insurance rules.

White House Submits FY 2018 Budget Request to Congress

On May 23, the White House submitted its proposed fiscal year (“FY”) 2018 budget request to Congress. The HHS budget request calls for a $610 billion cut to Medicaid and a $12.4 billion cut to HHS’s discretionary funding. Like every administration’s budget request, the proposal is non-binding with Congress and generally not aimed at seeking bipartisan agreement. Still, the proposal indicates the direction the Trump administration would like to take on health care spending and other areas.

The proposals major savings come from capping Medicaid’s federal funding for the first time. Under the plan, states would receive fixed funding from the federal government while being granted new flexibility to administer their Medicaid program. The proposal is in line with the AHCA, which would also make significant changes to Medicaid’s financing. The proposal will have a hard time gaining traction in the Senate where Republicans are trying to develop a more moderate health care reform bill.

Ways and Means Committee Passes Three ACA Repeal Bills

On May 24, the House Ways and Means Committee advanced a package of bills designed to repeal portions of ACA not addressed in the AHCA. The bills are part of the Republicans “third bucket” of health care reform, which is expected to include other measures.

At the start of 2017, Speaker of the House Paul Ryan (R-WI) laid out three “buckets” for health care reform legislation. The first was the AHCA, which the House fast-tracked through the budget reconciliation process. The executive branch is in the process of implementing the second bucket, which has largely dealt with regulatory reforms to the insurance market.

The first bill in the third bucket (H.R. 2372) codifies existing regulation that ensures veterans who are not already enrolled in and receiving health insurance through the Veterans Affairs Department have help to purchase coverage on the individual insurance market. The second bill (H.R. 2579) would allow tax credits available under the AHCA to be applied to COBRA plans. The final bill (H.R. 2581) would require individuals to verify their income eligibility and citizenship or legal immigration status with the Social Security Administration before accessing premium tax credits.

Health-Related Bills Introduced This Week

Rep. Glenn Thompson (R-PA) introduced two health-related bills over the past week. The first (H.R. 2550) would amend Title XVIII of the Social Security Act to provide for an incremental expansion of telehealth coverage under Medicare. The second bill (H.R. 2599) seeks to refine how Medicare pays for orthotics and prosthetics and improve beneficiary experience and outcomes with orthotic and prosthetic care. A companion bill was introduced in the Senate by Sen. Charles Grassley (R-IA).

Rep. Diane Black (R-TN) introduced a bill (H.R. 2556) seeking to expand access to telehealth services under Medicare.

Next Week in Washington

The House and Senate are out of session next week for the Memorial Day recess. Both return the week of June 5.