President-elect Donald Trump and Congressional Republicans take first steps toward repealing the Affordable Care Act.
President-elect Donald Trump and Congressional Republicans mean business, and there can be no doubt they’re aiming at Obamacare. The first tangible step toward the repeal of the Affordable Care Act (commonly known as “Obamacare”) has now been taken.
What just happened in Congress?
As of Thursday, January 12, 2017, both houses of the United States Congress approved a rules measure that sets the stage for the repeal of Obamacare and its replacement by a Republican alternative. The rule will allow Congress to use what’s called the budget reconciliation process to dismantle the Affordable Care Act, President Barack Obama’s signature piece of domestic legislation.
What’s the budget reconciliation process?
The budget reconciliation process is a method of passing legislation through Congress with fewer votes than might be required for laws without budgetary implications. Specifically, under the budget reconciliation process the US Senate can pass a piece of legislation with a simple majority of 51 votes rather than 60. Without utilizing the budget reconciliation process, it is unlikely that the repeal of Obamacare could pass the Senate.
Has the budget reconciliation process been used before?
In fact, it was used by Democrats when they controlled both houses of Congress and passed the Affordable Care Act on a strictly party-line vote in 2010. If they hadn’t used the reconciliation process, Obamacare might never have become law. In adopting the rules necessary for a budget reconciliation vote on the Affordable Care Act now, Congressional Republicans are showing their willingness to dismantle the law on a similar part-line vote.
Will repeal and replace happen at the same time?
It appears so. Both President-elect Trump and Speaker of the House Paul Ryan have recently stated that Obamacare will be repealed and replaced simultaneously. In prior weeks, there had been discussion about repealing the law in the short term and replacing it with something else later, but that two-step plan now appears to have been shelved.
What will replace Obamacare?
It is not yet clear what Republicans will propose as a replacement for Obamacare, but Republicans in the House of Representatives and Speaker Ryan have championed a proposal known as A Better Way, which may serve as the basis of their replacement.
This proposal would do away with Obamacare’s mandate requiring most Americans to have health insurance or face potential tax penalties. It would replace Obamacare’s income-based subsidies with age-based tax credits that are available to anyone purchasing health insurance on his or her own.
Among other things, A Better Way would also allow health insurance companies to offer plans with more restrictive benefits. For example, an older adult would no longer be required to purchase a plan that covers maternity care. It may also become possible to purchase plans that only cover generic drugs. Benefit adjustments like this may help to lower monthly premiums for health insurance shoppers.
More details are expected in the days and weeks to come. You can rest assured that at eHealth we’ll be tracking developments closely. As always, our goal is to help Americans understand what any new legislation will mean for them and to help them find the coverage they need at a price they can afford.