HOUSE PASSES REPEAL AND REPLACE LEGISLATION

After a dramatic 217-213 House vote to repeal and replace the Affordable Care Act (ACA), the question many are waking up to is, "What does this all mean?" In short, it means these ACA repeal efforts live for another day by moving over to the U.S. Senate. Senate Republicans will now have to maneuver between its conservative members and moderates without the losing three votes necessary to get them to a majority.

While the House bill as passed is unlikely to become law, it is important to understand what is in it for the process going forward. 

• First, and foremost, it repeals the individual mandate of the ACA.

• Second, it repeals the taxes that paid for the subsidies and Medicaid expansion of the ACA--- the biggest of those is the 3.8 percent tax that applied to capital gains, dividend, and interest income for families with $250,000 or more in income ($125,000 for singles). The Joint Committee on Taxation estimates that getting rid of this tax costs $157.6 billion over 10 years.

• Third, the House bill would provide an option for states to waive out of the "essential health benefits" of the ACA, such as prenatal care, preventative care and mental health coverage.

• Fourth, the bill would allow states to drop the requirement that insurers charge everyone the same price regardless of their health history, or pre-existing conditions. It provides some funding for states that establish high-risk pools.

• Fifth, it would phase out the Medicaid expansion of the ACA that covered adults making up to 133 percent of the federal poverty level. It would also change how the federal government would reimburse states for Medicaid expenses by turning the money into a "block grant," or a lump sum rather than a per-person payment for each Medicaid patient. This payment method would still cut the program further over time.

• Sixth, the House bill would provide a tax credit for people buying insurance on their own based on their age rather than their income, phasing it out for individuals making more than $75,000 or families making more than $150,000.

Senate GOP leadership has indicated that they will not be forced into any deadlines, but will take their time and have the proper scoring by the Congressional Budget Office before moving a bill. To further these ACA repeal and replace efforts, Senate Majority Leader Mitch McConnell (R-KY) has created a working group made up of leadership from committees of jurisdiction and the various wings of the GOP in the Senate. They are likely to cobble together a bill allowing the Senate to reach 50 votes plus Vice President Mike Pence. After that, the two chambers will go about the business of reconciling the two bills. 

Information provided by the National Association of Enrolled Agents

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