Why Trump's Rewriting GOP Health Bill on the Fly: QuickTake Q&A

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The GOP Alternative to Obamacare Explained

Ever since the Affordable Care Act was passed in 2010, Republicans have had no bigger priority than their pledge to "repeal and replace" it. During the 2016 campaign, President Donald Trump vowed that as well. But the bill proposed by House Speaker Paul Ryan is facing a bigger problem than a united Democratic opposition: conservatives who think it doesn’t go far enough in undoing Obamacare and who have the votes to block it. Trump has put forward some last-minute proposals that might save the bill in the House -- or doom it in the Senate, where Republican moderates were already dubious. A vote on the bill planned for Thursday has been postponed while the conservatives think Trump’s ideas over. It’s no wonder Trump recently said, "Nobody knew health care could be so complicated."

1. What’s going on?

Trump met with the hardline conservative Freedom Caucus over Ryan’s bill, called the American Health Care Act. He offered to amend the bill to strip one key component it had kept from Obamacare, namely its requirement that insurance cover what are termed essential benefits. Those include hospitalization, ambulance services, maternity care, pediatric services, mental health and substance abuse treatment, prescription drugs, rehabilitative care and laboratory services. But that offer only applied to policies sold through the individual market, not to employer-based plans. Members of the caucus have said they want to undo a wider range of regulations.

2. Why do the conservatives want those out?

They want consumers to be able to buy plans that offer just the coverage they want. They say that fewer people will be uninsured if cheaper plans are available. They also object to having the federal government take such a direct role in shaping the insurance market. Democrats respond that the change would send premiums up sharply for women, older people and those in poor health, and would leave people buying limited plans vulnerable to unexpected illnesses.

3. Will doing that help get the bill passed?

In the House, maybe. Some Freedom Caucus members say they’ll only sign on if the bill also drops Obamacare’s requirement that insurers cover pre-existing conditions -- perhaps its most popular provision. The White House said the change Trump proposed is moving others toward yes. But it could also lead a number of moderates to vote no.

4. How about the Senate?

That’s even less clear, for two reasons. Republicans had been counting on using a procedure called reconciliation to avoid a filibuster in the Senate. But that’s supposed to be reserved for spending and tax measures only -- the original plan was to address required benefit rules in a later bill. And even if those items are allowed into a reconciliation bill, it’s not clear if there would be 51 Republican votes for it. The change would likely please a handful of conservative Republicans who had indicated they would vote against the AHCA. But a group of more moderate senators had already said they were opposed, and dropping the essential services requirement could lead others to join them.

5. OK, negotiations aside, what would the AHCA do? 

It would phase out key parts of Obamacare over several years, including the taxes that had paid for expanded coverage. It would end the requirement that all individuals buy coverage; instead, it would let insurers charge higher premiums to people who let their coverage lapse and are seeking a new policy. It would replace the ACA’s income-based tax credits that help people in the individual policy market pay for insurance with tax credits based on age. The ACA’s expansion of Medicaid would be reversed.

6. What do they have in mind for Medicaid?

Big changes. The bill would cap federal funding for the entire Medicaid program, which covers about a quarter of Americans. That’s a big change from the current situation, in which the federal government pays for a percentage of each state’s Medicaid costs, without an upper limit. Taken together, the funding limit and the end to Medicaid expansion would cut federal Medicaid spending by about $880 billion over a decade. In 2026, that would result in about 14 million fewer Medicaid enrollees, a 17 percent reduction compared to the ACA, according to an estimate by the CBO in early March. To appeal to conservatives who have slammed the bill as "Obamacare Lite,” an amendment was proposed to allow states to add work requirements for recipients.

7. How else might it be changed?

To address affordability, amendments to the bill would set aside funds the Senate could use to make more changes. And Senate Majority Leader Mitch McConnell says further changes could be made on the Senate floor.

8. How different is it from Obamacare?

Conservatives are right that it keeps the basic framework of the ACA, offering tax credits to help people buy insurance that must meet federal standards, and leaves Obamacare’s expansion of Medicaid in place, at least for a while. But Democrats are right that many fewer Americans would be covered, according to the Congressional Budget Office’s analysis of the original bill. The CBO said the law would lead to 24 million fewer people having insurance in 2026 than under Obamacare. That’s mostly because of the Medicaid cuts and because smaller credits making insurance unaffordable for others, especially older people with lower incomes -- a group that voted strongly for Trump. Ryan’s bill would also repeal the ACA’s tax increases, which fell primarily on upper-income households, at a cost of about $883 billion over 10 years.

9. What do Democrats say?

So far, none have wavered in opposition to Ryan’s bill, the AHCA. On Thursday, the seventh anniversary of the signing of the ACA, former President Barack Obama defended the law’s accomplishments and said that Democrats should be willing to work with Republicans, but only on measures that improve coverage and affordability.

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