Health Care News, Health Center Federal Policy

First Look: House Releases ACA “Repeal and Replace” Bill

Last night around 6pm, the Congressional effort to repeal and replace the Affordable Care Act entered a new phase, as House Republicans released the draft legislative text of their proposal. The legislation will be considered this week by the two primary committees with jurisdiction over health care – the Energy and Commerce Committee and the Ways and Means Committee. The draft text and section-by-section summaries are linked below.

In the coming days, NACHC will have more in-depth analysis and public statements regarding the bill and the effect it may have on health centers and our patients. As discussed on past webinars and in our materials and talking points, a major focus of that analysis will be on proposed changes the bill makes to the Medicaid program, which covers nearly half of all health center patients and is a crucial source of revenue that supports ongoing operations. In the meantime, however, we wanted to provide advocates with a basic summary of what the bill contains.

One note of caution – we expect the language of this legislation to continue changing throughout the process, both as amendments are added in Committee and as the Congressional Budget Office (CBO) and others release analysis of what the bill would mean. That said, here are some of the basics:


  • The ACA Medicaid expansion, which has been adopted in 31 states and Washington, D.C., would end on December 31, 2019. At that point, expansion beneficiaries would remain enrolled, but would become ineligible if they drop out of the program for 30 days.
  • Beyond the changes to the expansion population, the bill also proposes a major overhaul of how Medicaid is structured and financed. Instead of the current open-ended federal entitlement, states would get capped payments based on the number of Medicaid enrollees in different categories (Elderly, Blind, Disabled, Children, Expansion Adults, Non-expansion Adults), which would grow over time but not necessarily as fast as the cost of delivering care.
  • The bill allocates $10 billion over 5 years to be used to raise payments to Medicaid providers in non-expansion states.
  • The bill does not propose any change to the current FQHC Prospective Payment System (PPS) or the required FQHC services under Medicaid. Indeed, because of some of the parliamentary rules surrounding the bill, very little of the “state flexibility” sought by governors and others is included in the proposal.

Private Insurance/Exchanges

  • The bill would create age-based tax credits for the purchase of insurance, ranging from $2,000 to $4,000, replacing the Affordable Care Act’s income-based subsidies. Credits for a single household would be limited at $14,000. Subsidies would be phased out for higher-income Americans – for individuals earning $75,000 and at $150,000 for families.
  • The bill would end the penalty for both individuals who don’t have health insurance (the “individual mandate”) and employers who don’t offer it (the employer mandate).
  • Even though the individual mandate is effectively eliminated, the bill does contain a new requirement that individuals maintain continuous coverage or face a financial penalty the next time they obtain insurance. A person whose coverage lapses would have to pay a 30 percent surcharge on premiums for a year when they sign up again.
  • Starting in 2018, the proposed bill would eliminate many of Obamacare’s taxes, including those on prescription and over-the-counter drugs, tanning services and health savings accounts.
  • The bill also includes $100 billion for state grants aimed at stabilizing the individual market over 10 years. States could use this money to create reinsurance programs or high-risk pools to cover the costs of the sickest, most expensive customers.
  • The House plan would also let insurers charger older customers more, while dropping costs for younger customers. Currently, insurers can charge their oldest customers no more than three times as much as younger enrollees, but the House plan increases that to a five-to-one ratio.

Again, we’ll plan to have more analysis, detail and reaction as the process unfolds. At this stage, despite now having more detail than we’ve had up until this point, key questions remain unanswered – questions that will shape and determine the outcome of the legislation. First, how much does the bill cost and what impact will it have on the number of people with insurance? That information will be determined by the CBO, and Congressional leaders have pledged to have those questions answered by the time the bill moves to the floor. Second, does it have the votes needed to pass? Both House conservatives and Senate moderates expressed their concerns about the bill yesterday. Margins are very close in both chambers, and no Democrats are expected to support this effort – meaning Congressional leaders can only afford a small handful of “no” votes on their side for the bill to stand a chance of passage.

Want to watch the legislative process in action? Both Energy and Commerce and Ways and Means will webcast their legislative markups on their respective Committee websites, starting Wednesday at 10:30 AM.