Although the healthcare bills have many fundamental similarities, the Senate’s Better Care Reconciliation Act differs from the House’s American Health Care Act (AHCA) in ways that extend beyond the name change.
When Senate Republicans released their health reform bill on Thursday morning, House Speaker Representative Paul Ryan (R-Wisconsin) told the press that the new bill “tracks in many ways along the lines of the House bill” that he helped to pass on May 4. Although the bills have many fundamental similarities, the Senate’s Better Care Reconciliation Act (BCRA) differs from the House’s American Health Care Act (AHCA) in ways that extend beyond the name change.
Here are 5 components of the BCRA that diverge from the AHCA:
1. Tax credit subsidies based on income, not just age
In the BCRA, premium assistance subsidies are based on age bracket, geography, and income tier for households making up to 350% of the federal poverty level. The AHCA had calculated these credits based solely on age, making the BCRA more similar in this regard to the Affordable Care Act (ACA), which provided subsidies based on age, income, and geography for those with incomes up to 400% of the poverty level.
This revision of the tax credit structure seems designed to prevent a scenario possible under the AHCA where older people with lower incomes would see their premiums rise dramatically. The Congressional Budget Office’s analysis of the House bill had found that a 64-year-old making $26,500 a year could have to pay as much as $16,100 annually for premiums, up from $1700 under the ACA. As reported in The Hill, this bill's iteration of the tax credit is designed to still allow individuals to buy private coverage, but also allow the government to save money.
2. States can’t waive preexisting condition coverage requirements
One of the more controversial components of the AHCA was the provision that states could apply for waivers allowing insurers to charge higher premiums based on health status to beneficiaries who had let their coverage lapse for more than 63 days. The BCRA does not allow states to pursue such waivers, meaning that, as under the ACA, insurers cannot deny coverage or hike premiums based on a person’s preexisting medical conditions.
Therefore, provisions for high-risk pools have been cut from the BCRA, since these funds in the AHCA were meant to cover the sick patients who could have been unable to afford coverage due to their medical history.
3. Medicaid expansion phase-out is longer
Seemingly in response to the concerns of senators from states that had expanded Medicaid under the ACA, the timeline for winding down the extra federal funding for these states has been extended. The AHCA would have reduced the federal match rate for expansion states to pre-ACA levels in 2020, but the BCRA starts to incrementally lower these higher payments in 2021, until the federal support returns to normal Medicaid match levels in 2024.
According to a summary from the Senate Budget Committee, this phase-out will improve the Medicaid program “by giving states more flexibility while ensuring that those who rely on this program won’t have the rug pulled out from under them.”
4. Medicaid cuts over time
By changing the Consumer Price Index (CPI) metric used to calculate inflation, the BCRA diverges from the AHCA in how it plans to cap Medicaid spending. In both bills, the annual increases in the per-capita limit through 2024 would be adjusted for inflation based on the CPI-M measure, which indicates the growth of medical costs. The BCRA will begin to adjust the per-capita formula based on the CPI-U, which measures prices for urban consumers, in 2025. The CPI-U is expected to grow more slowly than the CPI-M, which would translate to reduced funding for Medicaid.
However, the BCRA includes protections for vulnerable groups, such as disabled children, patients treated for breast and cervical cancer, and youth enrolled in the Children’s Health Insurance Program, by making them exempt from the cap formula.
5. Added funding designated for opioid abuse treatment
Legislators, the White House, and other governmental agencies like the FDA have all deemed the opioid epidemic a top priority. The AHCA did not specifically include any additional funding to combat the crisis, but the BCRA will appropriate $2 billion in 2018 that states can use to fund treatment and recovery services for people with substance use disorders, including opioid abuse.
This $2 billion in grants is a lower figure than requested by some Republican lawmakers in states hit hard by the opioid crisis, like Senator Rob Portman (R-Ohio). The bill must garner votes from at least 50 of the 52 Republicans in the Senate, which could give Portman and others the leverage to insist on higher levels of opioid treatment funding as the draft undergoes revisions and negotiations.