Congress Clears Path for ACA Repeal

On Jan. 13, 2017, the U.S. House of Representatives passed a budget resolution for fiscal year 2017 to begin the process of repealing the Affordable Care Act (ACA).

The budget resolution – which was approved by the U.S. Senate on the preceding day – does not, itself, repeal the ACA. However, any budget reconciliation bill drafted as a result of the resolution is likely to include a number of provisions to repeal – and possibly replace – at least some ACA provisions.

This budget resolution is a nonbinding spending blueprint that is used to create federal budget legislation through a process called “reconciliation.” As a result, it does not need presidential approval, and does not become law. Once drafted, a reconciliation bill can be passed by both houses with a simple majority vote. Because both the House and Senate have approved the budget resolution, committees from both chambers will now begin the process of drafting repeal legislation. If this legislation is passed in both the House and the Senate by a least a simple majority vote, it would then go to President Donald Trump for approval.

Republicans have given some indication as to what this repeal legislation may include, although many questions still remain. At this time, Republicans have not agreed on a plan to either repeal or replace the ACA.

Following are ACA Provisions that MAY be affected:

  • The individual mandate – The ACA’s individual mandate requires most individuals to obtain acceptable health insurance coverage for themselves and their family members or pay a penalty. Because this provision is enforced as a tax, it is a key target for repeal through the budget reconciliation process.
  • The employer shared responsibility rules – The ACA’s employer shared responsibility rules require applicable large employers to offer an acceptable level of health coverage to full-time employees (and their dependents) or pay a penalty. This provision is also enforced as a tax, and therefore, is also a key target for repeal through the budget reconciliation process.
  • Federal Exchange subsidies for low-income individuals – The ACA created health insurance subsidies to help eligible individuals and families purchase health insurance through an Exchange. These subsidies have long been a target for opponents of the ACA, and are currently being challenged in federal court. Therefore, it is likely that the budget reconciliation bill will included provisions affecting these subsidies.

Looking ahead, despite Democratic opposition, Republicans have enough votes in both the Senate and the House to pass a budget reconciliation bill to repeal aspects of the ACA. In addition, President Trump has vowed to approve legislation repealing the ACA.

Nevertheless, there is growing concern over the impact that a full or partial repeal of the ACA would have on the American public. Although Republicans have expressed an intent to enact a repeal and replacement simultaneously, member of both parties have concerns over whether that may be possible.

If you’re looking for health insurance or have any questions about the ACA Repeal, please contact Consolidated today!