Republican Sen. Susan Collins of Maine and a senator from Louisiana rolled out their proposal for replacing the Affordable Care Act on Monday, touting it as a bipartisan compromise. But the bill already was under attack by a leading Democrat, and many details have yet to emerge.
It’s not clear how the proposed replacement would affect the 20 million Americans, including 80,000 Mainers, who currently purchase health insurance under the ACA. It also was not immediately clear what a typical premium or deductible would be.
Read one-page synopsis of Patient Freedom Act
Read the Patient Freedom Act
Collins maintains that more Americans would be insured if the bill – the Patient Freedom Act of 2017 – were to become law.
“Our goal is to expand the number of people insured,” said Collins, who has argued in favor of a comprehensive replacement for the ACA as Congress debates whether to repeal it.
Collins said the proposal, which lacks some details on how it would operate, could attract support from Democratic and Republican lawmakers.
“I really believe this approach can bring both sides together,” Collins said Monday morning during a phone interview with the Press Herald. Collins believes Sen. Joe Manchin, D-West Virginia, is interested in the plan, and she has spoken with several other Democrats about the idea, and they seem willing to listen.
Collins, a moderate Republican, said she has yet to speak to Maine Sen. Angus King, an independent who caucuses with Democrats, but she plans to do so soon.
The ACA, commonly called Obamacare, is under threat of repeal by a Republican-led Congress and President Trump, who has vowed to repeal and replace former President Barack Obama’s signature domestic achievement.
Trump has not yet unveiled the administration’s replacement plan, but he signed an executive order Friday that could weaken the ACA. Collins said Monday that she was “very confused” by Trump’s executive order, and the ramifications of it are unknown.
Under the bill that Collins is pushing with her Republican co-sponsor, Louisiana Sen. Bill Cassidy, states could choose to stay in the federal health care plan as it is or create a new system that would transfer the uninsured into high-deductible plans that would deposit several thousand dollars per year of taxpayer money into health savings accounts for each person who was previously uninsured.
The money deposited into the accounts would be used to pay premiums, deductibles and co-pays. The amount people received would vary by geography and age, and by income for those with higher incomes.
“This is a generous approach to allow states to cover uninsured individuals,” Collins said.
LINCHPIN: MORE POWER TO STATES
Federal funding for the states would be the same regardless of whether the state chose to remain in the ACA or picked the alternative.
For states choosing the ACA alternative, the taxpayer funds deposited into individual health savings accounts could accumulate year-over-year, which is designed as a benefit for healthier patients and promoted as a boon for young people who could see the accounts balloon over time, providing a nest egg to pay for future health care costs.
People also could contribute to the tax-free health savings accounts each year, up to $5,000 for an individual or $10,000 for a married couple.
Those with serious illnesses would be covered, and the plan, like the ACA, would not permit insurers to place lifetime limits on how much is paid out for claims, protecting people with severe illnesses from having to pay out of pocket for catastrophic medical expenses.
The plan also keeps in place protections for patients with pre-existing conditions, and allows parents to keep their children on their plans through age 26. The plan also would cover some versions of prescription drugs and childhood immunizations.
Karen Pollitz, a senior fellow on health reform and private insurance for the Kaiser Family Foundation, said the plan is intriguing and signals a “different approach,” though she needed more details to determine how it would affect the health insurance landscape in the United States.
Senate Minority Leader Chuck Schumer, D-New York, criticized the plan Monday, saying, “It is nearly impossible to keep the benefits of the Affordable Care Act without keeping the whole thing.”
Collins blasted Schumer for slamming the plan before the ink was dry on the bill. The text of the bill was not available until Monday evening.
The linchpin of the bill gives more power to the states. Under one option, the government would deposit thousands of dollars in taxpayer funds into a health savings account for those who were uninsured, and automatically enroll them into a high-deductible plan. States would contract with insurance companies to administer the plans.
Under another option, states could choose to keep the Obamacare health plans they already have, including Medicaid expansion and the health insurance marketplace, where people purchase subsidized insurance.
“We believe in some states the ACA is working well. We don’t mandate a one-size-fits-all approach,” Collins said. “If the ACA is working in your state, you can keep it.”
The bill would leave it up to states to figure out how they would decide whether to stay in the ACA or not – either through executive action or by requiring the consent of the state Legislature.
States also could refuse all federal funding for health care.
Collins said that in many states, the ACA is underperforming, and the bill gives states the option to receive the same funding that they would under the ACA, but use it to instead develop a new system for low- to moderate-income residents.
If a state chose to exit the ACA, everyone who does not otherwise have access to insurance – such as through an employer or Medicare – would be automatically enrolled in a standard high-deductible insurance plan, and several thousand dollars would be deposited into a health savings account for each individual.
For states choosing the alternative to the ACA, the bill envisions a three- to four-year transition period.
Collins emphasized that the coverage would not be a catastrophic plan – a category of plans common pre-ACA that were often criticized by insurance experts for their overly skimpy benefits and failure to pay claims. The high-deductible plans would offer health benefits that would be covered by insurance and claims would be paid, Collins said.
“This is real insurance,” she said.
Individuals also would have the option of purchasing a more robust health plan by supplementing the federal funds with their own money.
Collins said under the bill, individuals would receive the taxpayer-funded deposits if they earned up to $90,000, or $150,000 for a married couple. After the income thresholds are reached, the assistance would be gradually reduced.
While funding for the ACA can be gutted with a simple majority – Republicans have a slim 52-48 majority in the Senate – a replacement bill would need 60 votes and the cooperation of several Democrats.
WINNING SUPPORT OF DEMOCRATS
Emily Brostek, executive director of Consumers for Affordable Health Care, an Augusta-based nonprofit, said that for Democrats to jump on board, they would have to be persuaded that this bill would be better than the ACA.
“Once we have the details, it can be judged and analyzed,” Brostek said. “This doesn’t seem simple, and in many ways, it seems more complicated.”
Brostek said serious negotiations over replacing the ACA would take several months in order to hash out details. Meanwhile, repeal is currently on a fast track, started by Republicans in the House and Senate. Collins voted in favor of starting the repeal process, but has repeatedly said a comprehensive replacement plan needs to be developed and that repealing the ACA without a plan would jeopardize the health insurance of millions.
Collins said the replacement plan she’s introducing with Cassidy would likely result in more people being insured than currently are under the ACA.
Cassidy, in a joint news conference Monday with Collins in Washington, said giving the uninsured money up front in a health savings account would be an incentive for them to use their health insurance by getting preventive care or taking care of a health issue before it becomes severe.
Cassidy said people with low incomes and ACA insurance currently have a disincentive to use their insurance because they must first meet the deductible.
“If a patient has a $6,000 deductible, that might as well be $6 million,” Cassidy said.
Collins said the Patient Freedom Act eliminates the “cliff” problem inherent in the ACA individual marketplace, where someone who earns a dollar more than 400 percent of the federal poverty limit – about $97,000 for a family of four – is cut off from all subsidies. The Patient Freedom Act would more gradually reduce the amount deposited into health savings accounts.
Joe Lawlor can be contacted at 791-6376 or at:
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