ACA Replacement Bill Could Put Health Coverage 'Out of Reach' for Millions

Doug Desjardins, March 20, 2017

The AHCA would provide lower assistance to current enrollees, meaning fewer would be covered, preliminary analysis shows.

This story originally appeared in California Healthfax.

"Millions of Californians" could lose health coverage under the proposed American Health Care Act (AHCA) due to reductions in federal subsidies and changes to Medicaid funding, according to Covered California Executive Director Peter Lee.

Covered California's preliminary analysis of the Affordable Care Act (ACA) replacement bill suggests the AHCA would "provide lower overall assistance to our current enrollees" and estimates that subsidies could be cut by as much as 40% from current levels for enrollees by 2020.

Covered California did not provide estimates or projections on how the changes would affect overall enrollment.

"The most critical element of the ACA is the subsidies that make coverage possible," said Lee. "The dramatic reduction in the amount of subsidies means there's going to be fewer people covered."

The AHCA's proposed changes to Medicaid—which include phasing out Medicaid expansion and funding Medicaid under a block-grant plan—could also jeopardize coverage for the nearly 4 million state residents who joined Medi-Cal under Medicaid expansion, said Lee.


ACA Replacement Plan Is 'Disaster' in the Making, CA Experts Say


Covered California's preliminary analysis estimates that a family of four living in Los Angeles with an annual income of $41,000 would have its annual subsidy reduced from $10,000 a year to $7,812 per year under the replacement plan.

For the individual market, the analysis estimates that a 62-year-old individual with an annual income of $30,000 living in San Francisco would see his or her annual subsidy drop from $9,516 to $4,000.

The report also suggested that people living in Northern California, where premiums are higher on average, would be at a disadvantage under the replacement plan, since subsidies would be the same statewide and would not vary by market.

Lee noted that subsides are designed to "bring premiums within reach" for lower income residents and Covered California estimates that more than 90% of consumers who purchase health plans on the state exchange in 2016 received subsidies.

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