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We already know the House Dems' first vote in the new Congress will be to defend the ACA against the GOP lawsuit to end pre-existing condition protections. But what then?
The package of reforms with the most support in the Dem caucus in the current Congress (H.R.5155 - Undo Sabotage and Expand Affordability of Health Insurance Act of 2018) is the obvious starting point.
What are those reforms?
Premium relief through more generous premium subsidies
How it works now: The ACA provides subsidies to people under 400% of the federal poverty line for their premiums: once they've put a certain percentage of their income toward a benchmark silver plan, the subsidy pays the rest of the cost of the plan.
How it would change: The Dem reforms would make the premium subsidies more generous by (1) lowering the percentage of income an individual or family has to contribute, and (2) making premium subsidies available to people over 400% FPL, eliminating the "cliff" some have criticized.
To put this in concrete terms, let's imagine the example of a family of four (two 40-year-olds with two young kids) buying the national average 2018 benchmark plan.
If that family makes $30K, its monthly premium falls from $50 under the ACA to $25 under the proposed reforms.
If it makes $50K, its monthly premium falls from $263 to $167.
If it makes $75K, its monthly premium falls from $595 to $438.
And if it makes $105K, its monthly premium falls from $1,494 to $744.
Out-of-pocket spending relief through more generous cost-sharing reductions
How it works now: The ACA requires insurers to reduce out-of-pocket limits and spending (e.g., deductibles, copays, etc) for low-income people, effectively making their coverage more generous. This is referred to as cost-sharing reduction (CSR).
While silver plans normally have 70% actuarial values (actuarial value being a measure of plan generosity that indicates how much the insurer shells out vs. how much enrollees have to pay out of pocket when people get services), under the ACA people with lower incomes get silver plans of 73% actuarial values, 87%, or even 94%.
These reductions are the reason that, despite all the hoopla about high deductibles in the exchanges, the median deductible actually faced by consumers in the marketplaces in 2016 was $850.
How it would change: The Dems would make the CSRs both more generous and more widely available. The CSR94 plans are currently reserved for only the poorest segment of marketplace shoppers; the Dem bill would make them available to everyone currently eligible to buy a CSR plan (i.e., those at or below 250% FPL). And while shoppers above 250% FPL currently aren't eligible for CSR plans at all, the Dems would make CSR87 plans available to those above that income level but below 400% FPL.
Oh, and they permanently make appropriations available to reimburse insurers for those cost-sharing reductions. The GOP has refused to appropriate funds to fulfill the government's obligation to make insurers whole for the CSRs, which led to large premium hikes in 2018 to make up for the lost revenue.
The package of reforms with the most support in the Dem caucus in the current Congress (H.R.5155 - Undo Sabotage and Expand Affordability of Health Insurance Act of 2018) is the obvious starting point.
What are those reforms?
Premium relief through more generous premium subsidies
How it works now: The ACA provides subsidies to people under 400% of the federal poverty line for their premiums: once they've put a certain percentage of their income toward a benchmark silver plan, the subsidy pays the rest of the cost of the plan.
How it would change: The Dem reforms would make the premium subsidies more generous by (1) lowering the percentage of income an individual or family has to contribute, and (2) making premium subsidies available to people over 400% FPL, eliminating the "cliff" some have criticized.
| Household income | Max % of income put toward premiums (ACA) | Max % of income put toward premiums (H.R. 5155) |
| 100%-133% FPL | 2.0% | 1.0% |
| 133%-200% FPL | 4.0% | 2.0% |
| 150%-200% FPL | 6.3% | 4.0% |
| 200%-250% FPL | 8.05% | 6.0% |
| 250%-300% FPL | 9.5% | 7.0% |
| 300%-400% FPL | 9.5 | 8.5% |
| 400% FPL and up | - | 8.5% |
To put this in concrete terms, let's imagine the example of a family of four (two 40-year-olds with two young kids) buying the national average 2018 benchmark plan.
If that family makes $30K, its monthly premium falls from $50 under the ACA to $25 under the proposed reforms.
If it makes $50K, its monthly premium falls from $263 to $167.
If it makes $75K, its monthly premium falls from $595 to $438.
And if it makes $105K, its monthly premium falls from $1,494 to $744.
Out-of-pocket spending relief through more generous cost-sharing reductions
How it works now: The ACA requires insurers to reduce out-of-pocket limits and spending (e.g., deductibles, copays, etc) for low-income people, effectively making their coverage more generous. This is referred to as cost-sharing reduction (CSR).
While silver plans normally have 70% actuarial values (actuarial value being a measure of plan generosity that indicates how much the insurer shells out vs. how much enrollees have to pay out of pocket when people get services), under the ACA people with lower incomes get silver plans of 73% actuarial values, 87%, or even 94%.
These reductions are the reason that, despite all the hoopla about high deductibles in the exchanges, the median deductible actually faced by consumers in the marketplaces in 2016 was $850.
How it would change: The Dems would make the CSRs both more generous and more widely available. The CSR94 plans are currently reserved for only the poorest segment of marketplace shoppers; the Dem bill would make them available to everyone currently eligible to buy a CSR plan (i.e., those at or below 250% FPL). And while shoppers above 250% FPL currently aren't eligible for CSR plans at all, the Dems would make CSR87 plans available to those above that income level but below 400% FPL.
| Household income | Plan Generosity for CSR Plans (ACA) | Plan Generosity for CSR Plans (H.R. 5155) |
| 100%-150% FPL | 94% | 94% |
| 150%-200% FPL | 87% | 94% |
| 200%-250% FPL | 73% | 94% |
| 250%-400% FPL | - | 87% |
Oh, and they permanently make appropriations available to reimburse insurers for those cost-sharing reductions. The GOP has refused to appropriate funds to fulfill the government's obligation to make insurers whole for the CSRs, which led to large premium hikes in 2018 to make up for the lost revenue.
These people live on Rock Candy Mountain. Bottom line they can vote away in the House on any old thing they want but it isn't going anywhere accept sit on a shelf and collect dust.
