Factbox - Republicans' Obamacare plan would dump Medicaid expansion, taxes

  • World
  • Thursday, 04 May 2017

(Reuters) - After months of internal discord, Republicans in the U.S. House of Representatives on Wednesday were still trying to craft a bill to overhaul the Affordable Care Act, known as Obamacare, a law they have been attacking since it was enacted in 2010.

Two attempts in recent weeks to pass an overhaul bill have collapsed in confusion, with conservatives pushing for a more complete repeal and moderates keen to avoid going too far for fear of angering their constituents.

Obamacare brought health insurance coverage to millions of Americans. The first version of the Republican bill, known as the American Health Care Act, or AHCA, would have left 24 million more Americans without coverage, according to an estimate by nonpartisan congressional researchers.

The House has recently added two amendments to the AHCA to try to appease both conservatives and moderates. Here are the latest versions of the bill's main provisions:


The Republican plan would maintain some of Obamacare's most popular provisions. It would allow young adults to stay on their parents' health plan until age 26 and it would ban insurers from setting a lifetime dollar limit on coverage.

An amendment introduced by moderate Republican Representative Tom MacArthur would let states opt out of Obamacare's mandate that insurers charge sick and healthy people the same rates. It would also allow states to opt out of Obamacare's requirement that insurers cover 10 essential health benefits, such as maternity care and mental health treatment.

The measure would provide states with $100 billion, largely to fund high-risk pools to provide insurance to the sickest patients. An amendment added Wednesday would provide another $8 billion over five years to help those with pre-existing conditions pay for health insurance.

The bill would let insurers mark up premiums by 30 percent for those who have a lapse in insurance coverage of about two months or more.

Insurers won another provision they had long sought: The ability to charge older Americans up to five times more than young people. Under Obamacare, they could only charge up to three times more.


The Republicans want to end in 2018 Obamacare's income-based tax credits that help low-income people buy insurance. These would be replaced with age-based tax credits ranging from $2,000 to $4,000 per year that would be capped at upper-income levels. While Obamacare's credits gave more help to those with lower incomes, the Republican plan would be largely age-based.

The Republican bill would abolish most Obamacare taxes, including on medical devices, health insurance premiums, indoor tanning salons, prescription medications and high-cost employer-provided insurance known as "Cadillac" plans.

Those taxes paid for Obamacare. Republicans have not said how they would pay for the parts of the law they want to keep.

The bill would also repeal the Obamacare financial penalty for the 2016 tax year for not purchasing insurance, as well as a surtax on investment income earned by upper-income Americans.

It would repeal the mandate that larger employers must offer insurance to their employees.


Under Obamacare, more than 30 states, including about a dozen Republican states, expanded the Medicaid government health insurance programme for the poor. About half of Obamacare enrollees obtained insurance through the expansion.

The bill would allow the Medicaid expansion to continue until January 1, 2020, providing states chose not to expand. After that date, expansion would end and Medicaid funding would be capped on a per-person basis.

State Medicaid plans would no longer have to cover some Obamacare-mandated essential health benefits, fulfilling a Republican promise to return more control to the states.

(Reporting by Yasmeen Abutaleb; Editing by Kevin Drawbaugh and Leslie Adler)

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