A new analysis by the National Academy of State Health Policy, in consultation with Covered California, shows that the U.S. Senate Republican Health Care plan released on June 22 would result in dramatically higher cost for most consumers while putting access to care beyond reach for many in the country.
The June 28 analysis focuses on the value of health coverage and subsidies across the nation, while comparing the current law under the Patient Protection and Affordable Care Act and proposed Better Care Reconciliation Act (BCRA), which the Senate is considering.
According to Covered California, the analysis looks at what consumers would need to spend to keep comparable coverage to what they have today, given the reduction in subsidies proposed in the Senate’s BCRA. The analysis also describes the coverage available on the individual market in California, Ohio and Pennsylvania.
“While the Congressional Budget Office (CBO) analysis makes clear that 22 million Americans would lose coverage under the Senate’s proposal, this report puts a spotlight on the fact that for the millions of Americans who would remain insured, the skimpier benefits are coverage in name only,” said Covered California executive director Peter V. Lee in a statement. “Many consumers would face huge financial hurdles to get needed care.
“The term ‘high deductible’ would take on a staggeringly high new meaning under the BCRA, with subsidies tied to a benchmark plan that would mean families would need to meet a deductible of more than $14,000 before most, if not all care, was covered,” Lee said. “Consumers would be stuck with thousands more in out-of-pocket costs – and 100 percent of the cost of their medications – if they enroll in the benchmark plan being proposed in the BCRA as it is written.”
According to the analysis, benchmark plans offered under the senate bill ((BCRA) would nearly triple a Covered California enrollee’s deductible, from $2,500 per year to $7,350, with a deductible for a family increasing to more than $14,700 and reductions in subsidy levels would result in dramatic increases in coverage costs for lower-income and older Americans.
“Covered California has worked hard to make sure benefit designs are patient-centered, with primary care, specialty visits, needed tests and prescription drugs that are not subject to any deductible,” Lee said. “Putting wildly high deductibles between patients and the care they need is a recipe for disaster.”
The analysis shows that under the BCRA there are significant changes that could make coverage extremely expensive to consumers, including:
▪ Adds age as a premium contribution factor and increases the maximum contribution from 9.5 percent of income to more than 16 percent of income for individuals 59 and older.
▪ Reduces the ceiling for receiving subsidies from 400 percent to 350 percent of the federal poverty level.
▪ Allows states to permit insurers to charge the oldest enrollees (age 64) five times what the youngest adult enrollees (age 21) are charged for their monthly premiums.
▪ Allows states to get waivers to the current essential health benefits, which the CBO estimates would mean that half of the Americans would be living without the existing protections from lifetime limits or “gotcha” coverage gaps in states that exclude entire categories of care.
The analysis also compares the subsidies provided under the BCRA to those available under current ACA law to purchase Silver-tier health plans, the most commonly selected coverage level currently available. The study provides estimates of costs for individuals of different ages and income levels, assessing what their costs would be if they live in lower-cost or higher-cost regions of each state.
The study uses Kaiser Family Foundation data and shows that the BCRA tax credit structure would modestly lower “net premiums” — what consumers pay after receiving a subsidy — for some younger enrollees in lower cost regions. However, many consumers, especially those who are lower income and older and live in higher-cost regions, would see dramatically higher net premiums under the BCRA due to the tax credit changes.
“At a basic level, we now have confirmation of what we feared: Lower enrollment would follow if the BCRA were approved as written,” Lee said. “What’s even more troubling is that healthier individuals would be more likely to drop coverage first, leading to higher premiums for the remaining enrollees.”
The analysis, “Barely Covered: Initial Analysis of Coverage and Affordability Impacts to Consumers Under the Proposed Better Care Reconciliation Act,” is available at: http://nashp.org/wp-content/uploads/2017/06/Barely-Covered.pdf