Summary of the American Health Care Act
- To help people buy insurance, if they do not have coverage at work or under a government program like Medicare or Medicaid, or through the Department of Veterans Affairs, the bill would offer $2,000 to $4,000 a year tax credits, depending mainly on age. A family could receive up to $14,000 a year in credits. The credits would be reduced for individuals making over $75,000 a year and families making over $150,000.
- Under current rules, insurers cannot charge older adults more than three times what they charge young adults for the same coverage. The House bill would allow them to charge five times as much. The Congressional Budget Office said this change would reduce premiums for young adults and increase premiums for older Americans.
- The bill would end Medicaid as an open-ended entitlement to health care and would put the program on a budget. States would receive an allotment of federal money for each beneficiary, or, as an alternative, they could take the money in a lump sum as a block grant, with fewer federal requirements. Medicaid cuts would total $880 billion over 10 years.
- The bill encourages people to maintain “continuous coverage” by requiring insurers to impose a 30 percent surcharge on premiums for those who experience a gap in coverage.
- Under the AHCA, states could opt out of certain provisions of the Affordable Care Act, including one that requires insurers to provide a minimum set of health benefits, such as maternity care and emergency services, and another that prohibits them from charging higher premiums based on a person’s health status.
- Insurers would not be allowed to charge higher premiums to sick people unless a state had an alternative mechanism, like a high-risk pool or a reinsurance program, to help provide coverage for people with serious illnesses.
- The bill would provide states with $138 billion over 10 years that could be used for various purposes like subsidizing premiums, providing coverage to people with pre-existing conditions and paying for mental health care and the treatment of drug addiction.
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