'Seniors have a lot to lose' under ACA replacement, congresswoman says

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The CBO logo.

The American Health Care Act, if implemented as proposed, would reduce the federal deficits by billions, increase the number of uninsured by millions and significantly raise premiums for low-income older adults who are not yet eligible for Medicare, according to an analysis released Monday by the nonpartisan Congressional Budget Office and the Joint Committee on Taxation.

“Seniors have a lot to lose,” House of Representatives Minority Leader Nancy Pelosi (D-CA) told reporters Monday at a press conference after analysis was released.

Republicans in the House proposed the replacement for the Affordable Care Act on March 6. Responding to the release of the CBO report in a statement posted Monday on his website, House Speaker Paul Ryan (R-WI) said, “It's important to note that this report does not take into consideration additional steps Congress and the Trump administration are taking that will further lower costs and increase choices.”

The CBO and JCT said they believe their predictions fall in the middle of the distribution of potential outcomes.

Reduced outlays for Medicaid

The federal deficits, according to the report, would be cut by $337 billion from 2017 to 2026, the result of a $1.2 trillion decrease in direct spending partially offset by an $883 billion reduction in revenues. The largest savings, the agencies said, would come from reductions in outlays for Medicaid and from the elimination of ACA subsidies.

By 2026, the CBO and JCT said, Medicaid spending would be about 25% less than what the CBO projects under current law. Medicaid financing also would change from being open-ended based on the services provided and the number of beneficiaries to a fixed reimbursement to the states in 2020, which the report noted might force states to either commit more of their own resources, cut payments to providers, eliminate services, restrict enrollment or find more efficient ways to deliver services.

Although not commenting directly on the CBO score, National Center for Assisted Living Executive Director Scott Tittle told McKnight's Senior Living on Monday that “a robust Medicaid program is essential” because 125,000 residents rely on Medicaid for assisted living services.

“NCAL is concerned that current Medicaid reform proposals threaten access to care by setting caps on benefits to low-income seniors and individuals with disabilities,” he said. “We encourage Congress to protect these vulnerable populations, so that they may receive the right care at the right time in the right place.” (See this article for additional comments about the bill from LeadingAge, the American Health Care Association and PHI.)

Monday on Twitter, Health and Human Services Secretary Tom Price said that the act gives states “the flexibility to develop healthcare models that meet the needs of their communities.” The CBO report, he said, “defies logic.”

Premium increases for older adults

The plan also would result in 14 million more people becoming uninsured in 2018 compared with the number of insured under the current law, according to the CBO and JCT.

“Most of that increase would stem from repealing the penalties associated with the individual mandate,” according to the analysis. “Some of those people would choose not to have insurance because they chose to be covered by insurance under current law only to avoid paying the penalties, and some people would forgo insurance in response to higher premiums.”

Lower-income older Americans would be among those seeing sharp premium increases over the next nine years, according to the report. A single 64-year-old whose annual income is $26,500 (175% of the federal poverty level) now pays a net $1,700 in annual premiums for health insurance purchased under the ACA, but the CBO and JCT said that this same individual would pay $14,600 in premiums under the American Health Care Act in 2026.

“Under the legislation, premiums for older people could be five times larger than those for younger people in many states, but the size of the tax credits for older people would only be twice the size of the credits for younger people,” the report noted.

Medicare effects

Older adults may not find relief once they hit 65, the current age at which most people become eligible for Medicare, under the American Health Care Act. And neither may their care providers.

At the press conference, Pelosi cited media reports that a provision in the act to repeal a payroll tax on high earners, which provides an additional revenue stream for the Medicare trust fund, would shorten the program's solvency by three or four years. That prediction came out of a separate analysis by the JCT that was released March 7.

Continued increases in uninsured

The number of uninsured people under the American Health Care Act relative to those insured under the ACA would increase by 21 million more in 2020 and by 24 million more in 2026 (to a total of 52 million), mainly due to changes in Medicaid enrollment, according to the CBO and JCT.

Thirty-one states and the District of Columbia already have expanded Medicaid under the ACA.

“Some states would discontinue their expansion of eligibility, some states that would have expanded eligibility in the future would choose not to do so and per-enrollee spending in the program would be capped,” according to the analysis.

The increase of uninsured individuals would be “disproportionately larger” among those aged 50 to 64 years who have incomes of less than 200% of the federal poverty level, according to the report.

“If there ever was a war on seniors, this bill, Trumpcare, is it,” Senate Minority Leader Chuck Schumer (D-NY) said in remarks at the press conference with Pelosi. “The bill spends almost twice as much on tax cuts for the wealthy compared with tax credits to help older and middle-class Americans afford health insurance.”

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