In this new and evolving health care environment, Priority Health is working on the community’s behalf to ensure our leaders pursue reforms that provide patients and families in Michigan and across the country access to the affordable health coverage they deserve.

As lawmakers implement reforms to our health care system, Priority Health is here as a resource and guide to help you navigate and understand the impact and cost of any changes and when they take effect.

At-a-glance health reform changes and their impact

Individual and employer mandates

Under current law

Requires individuals to obtain health insurance, and large employers to provide health insurance to their employees, or face financial penalties.

Under proposed House bill

Tax penalty for not having minimum essential coverage is retroactive to Jan. 1, 2016. The plan proposes a “continuous coverage incentive” which would charge people in the individual market a 30 percent penalty for lapses in health insurance coverage. The continuous coverage penalty would apply to those enrolling during a special enrollment period in 2018 and to all enrollees beginning in 2019. Tax penalty for large employers that do not provide health benefits is reduced to zero, retroactive to Jan. 1, 2016.

According to the Congressional Budget Office's analysis, 14 million fewer people would be insured in 2018 under the AHCA.

Status

Passed the U.S. House of Representatives on May 4, 2017. The U.S. Senate introduced its version of the legislation on June 22, 2017.

Benefit design

Under current law

Requires all plans offered in the individual and small group markets to cover ten essential health benefits including hospital care, prescription drugs and maternity care. Prevents health insurers from charging higher prices to customers with pre-existing health conditions; and limited health plans from charging their oldest customers no more than three times the price of younger customers.

Under the proposed House bill

Essential health benefit (EHB) requirement and pre-existing conditions policy would remain, however starting in 2020, states may apply for waivers to redefine essential health benefits for health insurance coverage offered in the individual or small group market. Starting in 2019, states would be allowed to waive the community rating requirement which prohibits insurers from charging sick people more than healthy individuals for the same insurance policy. States that waive this rule would be required to set up high-risk pools to help provide coverage for sick people. The proposal would also shift the age rating from 3:1 to 5:1 starting in 2018, unless states adopt a different ratio.

The Congressional Budget Office estimates about half of the population would be in states that would not seek waivers to the EHB or community rating rules.

Status

Legislation passed the U.S. House of Representatives on May 4, 2017. The U.S. Senate introduced its version of the legislation on June 22, 2017.

Health savings account

Under current law

Beginning in 2017, an individual can put $3,400 and a family $6,750 into a tax-free health savings account.

Under the proposed House bill

Allows people to put substantially more money into their health savings account and allows spouses to make additional contributions. The basic limit will be at least $6,550 for an individual and $13,100 for a family, beginning in 2018. Under the proposal, amounts withdrawn for qualified medical expenses would not be subject to income tax, and the penalty for HSA withdrawals used for non-qualified expenses would be reduced from 20 percent to 10 percent.

Status

Legislation passed the U.S. House of Representatives on May 4, 2017. The U.S. Senate introduced its version of the legislation on June 22, 2017.

Cost-sharing reductions

Under current law

Individuals and families with incomes between 100 percent and 250 percent of the poverty line ($11,880 to $29,700 for an individual, $24,300 to $60,750 for a family of four) can receive subsidies, called cost-sharing reductions, if they are eligible for a premium tax credit and purchase a Silver plan (one of four categories of plans with moderate monthly premiums and moderate costs for services) through the federal or state marketplaces.

Under the proposed House bill

Cost-sharing reductions would be eliminated in 2020.

Status

Legislation passed the U.S. House of Representatives on May 22, 2017. The U.S. Senate introduced its version of the legislation on June 22, 2017.

Premium subsidies

Under current law

The federal government provides tax credits to middle-income Americans, on a sliding scale according to income, to help offset the cost of premiums and deductibles.

Under proposed House bill

Changes the way subsidies will be distributed using age, instead of income, as a way to calculate how much people will receive, starting in 2020. Tax credits would increase as recipients get older and phase out for individuals making more than $75,000 or families making more than $150,000. For a person under 30, the subsidy would be $2,000, and it would double for people 60 and over. The proposal also expands the type of health plans that qualify for subsidies. Additional funding would be set aside for tax credits to help older Americans between 50 and 64.

Status

Legislation passed the U.S. House of Representatives on May 4, 2017. The U.S. Senate introduced its version of the legislation on June 22, 2017.

Medicaid expansion

Under current law

Provides states the option to expand Medicaid eligibility to nearly all individuals with incomes at or below 138 percent of the poverty line ($27,821 for a family of three in 2016). More than 30 states (including Michigan) have expanded Medicaid programs.

Proposed reform

Prevent new states from opting in to the ACA's Medicaid expansion. Current expansion states would receive 90 percent of enhanced federal funding as long as individuals remain eligible and enrolled in the program prior to Dec. 31, 2019. Starting in 2020, states would receive a set amount of money per enrollee, known as a per capita cap system. States would also be given the option to receive a lump-sum block grant for Medicaid, rather than per capita funding.

Status

Legislation passed the U.S. House of Representatives on May 4, 2017. The U.S. Senate introduced its version of the legislation on June 22, 2017.

At-a-glance health reform changes and their impact