The bill eliminates the penalty associated with the Affordable Care Act’s individual mandate, neutralizing a key provision of the Obama-era law Republicans have repeatedly failed this year to repeal. But the final bill also preserves some healthcare-related tax breaks that had been on the chopping block, including the medical expense deduction, orphan drug credit, and private activity bonds for nonprofits.
Opponents of the ACA have argued that American consumers have been left with too few health plans to choose from. Proponents have pointed to record highs in the number and rate of insured Americans since the ACA was passed.
“Regardless if you’re for or against it, it seems inevitable that the roll back of the individual mandate will result in decreased patient volume across care organizations of all sizes,” athenahealth CEO Jonathan Bush said in a statement. “With this in mind, it’s critical for healthcare orgs to revisit their approach to attracting and retaining patients, and of equal import, to reduce the underlying inefficiencies that might be distracting from delivery of the very best healthcare experience.”
Eliminating the individual mandate is projected to increase the uninsured population. What that means for disproportionate share hospitals (DSHs) that rely on payments to cover the costs of otherwise uncompensated care remains to be seen.
There are other items of unfinished business that could affect healthcare organizations in the weeks and months to come:
- PAYGO: The Pay-As-You-Go Act of 2010, known as PAYGO, calls for automatic spending cuts when the federal budget deficit is increased. Since the reconciled tax bill is estimated to reduce government revenue by $1.5 trillion, the law is expected to kick in next year, unless Congress steps in to waive the requirement. That waiver would require assistance from the Democrats.
- CHIP: After federal funding lapsed in September, lawmakers still haven’t renewed the Children’s Health Insurance Program, known as CHIP. Some states have begun notifying enrollees that their coverage could come to a halt. Democrats brought lumps of coal to a press conference Wednesday to call upon their Republican colleagues to take action in the final days before Christmas.
- CSRs: Sen. Susan Collins (R-Maine) had supported the tax reform bill in exchange for a few guarantees from McConnell. Those guarantees included a plan to reinstate the cost-sharing reduction (CSR) payments to insurers, which the Trump administration halted. Collins and Lamar Alexander (R-Tenn.) said Wednesday that they have asked McConnell to hold off on that measure until January.
All this comes as lawmakers look to avert a government shutdown that could strike if a funding bill isn’t passed by midnight Friday.
—Steven Porter is an associate content manager and online news editor for HealthLeaders, a Simplify Compliance brand.