How does a “skinny repeal” of Obamacare affect Colorado?
U.S. Senate Republicans, looking for a health care bill that can win majority support in their chamber, suggested a new, more modest plan Tuesday: A “skinny repeal” of the Affordable Care Act.
What is it and how would it impact Colorado? Read on for answers. What is a “skinny repeal”?
Answer: In a way, it is the bare minimum that you can roll back the Affordable Care Act, the health care law that’s also called Obamacare, and still claim you have repealed it. The exact details of the proposal are unclear, since senators haven’t officially introduced anything.
But reporting by The Hill, Politico, Vox and other outlets all agree on two points: The proposal would repeal the individual and employer mandates in the ACA — those are the requirements that everybody have health insurance. It would also do away with a tax on medical devices.
Everything else that’s up for debate in an ACA repeal — the subsidies for people who buy their own insurance, funding for Medicaid, the Medicaid expansion — would apparently remain as it is under current law.
Q: After so much talk about repealing Obamacare, what’s the logic behind such a modest proposal?
A: Reports out of Washington, D.C., are that a skinny repeal would be sort of a placeholder while lawmakers from both the House and the Senate work on a bigger idea. The Senate is expected to vote on more ambitious plans to roll back the ACA first. If those don’t pass, Republicans would then put forth the skinny repeal.
The House has already passed its own plan for repealing Obamacare, a proposal called the American Health Care Act. For the president to sign a bill into law, the House and the Senate must pass the same version of the bill, though, and the AHCA looks like it’s a nonstarter in the Senate. So, for the efforts to repeal the ACA to continue, the Senate has to pass something. That’s where the skinny repeal comes in.
As U.S. Sen. John Thune, a Republican from South Dakota, told Politico, the strategy is, “Whatever gets to 50.”
Once both chambers have passed their own version of a repeal, the House could just adopt the Senate’s version and send the bill onto the president. But it’s more likely the two chambers would hash out the differences in what is called a “conference committee.” The committee would essentially write a combined bill that both chambers would then vote on. That makes it unlikely, if it passes the Senate, that the skinny repeal would make it to President Donald Trump’s desk.
Q: But, if it does, how would a skinny repeal impact insurance markets?
A: For such a scaled-back plan, a skinny repeal could have significant implications. The main impact comes from dropping the mandates and the ripples that follow.
With no requirement to buy insurance, the Congressional Budget Office has estimated that a repeal of the individual mandate would mean 15 million more people without health insurance nationwide by 2026 compared to current law. Some of those would be people who don’t want to have to buy insurance. But others would likely be people who want insurance but feel they can’t afford it, according to the CBO.
The ripples start, though, when you look at who those people are.
The CBO projects that those dropping out of the market would likely be younger and healthier, on average, leaving the remaining insurance pool relatively older and sicker. That trend would probably freak out insurers, who would respond to a more expensive pool by raising premiums for everyone. (The CBO estimates that premiums in 2026 would be 20 percent higher nationwide without a mandate than they would be if the mandate remains in place.)
The federal government would then spend more providing subsidies to people who buy their health insurance on their own — though it would also save money by not providing subsidies to those who bailed. In total, the CBO estimates that eliminating the individual and employer mandates would save the federal government $381 billion in the first decade.
Meanwhile, repealing the medical device tax would reduce federal revenue by $19.6 billion in that time.
Q: How would a skinny repeal impact Colorado?
A: There aren’t a lot of Colorado-specific numbers yet on the impacts of a repeal of the individual mandate, but there are two areas of concern in addition to rising costs.
First, with more people uninsured, hospitals could be on the hook for providing more care that they don’t get paid for. That could threaten some hospitals’ ability to remain open.
Second, if insurers are spooked by federal policy changes, they could bolt from the state as early as this year, leaving people shopping on their own for health insurance with fewer — or no — choices.