What Does Obamacare Uncertainty Mean For You?

March 8, 2017 — House Republicans have unveiled their replacement plan for the Affordable Care Act. The bill, called the American Health Care Act, keeps a number of the current law’s provisions in place but dramatically changes others.

Markup of the bill by two House committees will start Wednesday. Republicans have set a deadline for the repeal of the Affordable Care Act, which is also called Obamacare, by mid-April.

WebMD responds to some frequently asked questions about the state of the law and how your health insurance coverage may be impacted.

Do I still have to pay the penalty?

The individual mandate, which requires most Americans to have health insurance or pay a tax penalty, is one of the most unpopular pieces of the Affordable Care Act. Republicans have insisted all along that any new plan to replace the law will eliminate it, and they’ve made good on their promise.

This bill eliminates the individual mandate effective by the end of 2015. Anyone who went uninsured last year (2016) would not be on the hook for the penalty this tax season, avoiding a possible payment of $695 for adults and as much as $2,085 for families, or 2.5% of annual income, whichever is higher. Last year, 6.5 million people paid the penalty.

In place of the individual mandate, the bill calls for people to maintain “continuous coverage.” That means if a person doesn’t have insurance for more than 63 days, insurers could tack on a 30% surcharge on premiums for the first 12 months of coverage.

I have insurance under Obamacare. Could I lose it this year?

It’s unlikely you’ll lose the coverage you currently have for 2017.

“The insurance plans in general are locked in for 2017, so there is little risk it could be taken away,” says Larry Levitt, a senior vice president at the Kaiser Family Foundation.

But there are caveats. For example, the Urban Institute projects that eliminating the individual mandate could cause more than 4 million mostly healthy people to cancel their health insurance.

That immediately changes the rules on the insurers, says Linda Blumberg, a senior fellow in the Health Policy Center at the Urban Institute. The people most likely to get rid of their insurance are those who are healthiest. That leaves sicker, more costly people left to insure, she says, and “insurers could be facing pretty significant financial losses.”

That means insurance companies might be able to change their contracts to charge more.

“Insurers, based on the contracts they signed, may either renegotiate what they’re charging, which would be very difficult to quickly do, or they may leave the market and stop offering insurance. It all depends on the kinds of contracts they wrote,” Blumberg says.

Could my costs change this year?

Again, insurance plans and premiums are finalized for 2017, so it’s not likely you’ll see immediate changes to your costs.

But going forward, that could change. Exactly how much depends on who you are.

In general, this bill is likely to lower costs for young people with higher incomes or for people living in places like New Hampshire, where insurance premiums tend to be lower. Conversely, it increases premiums for people who are older with lower incomes, or who live in areas with high-cost insurance premiums, such as Arizona.

The legislation Republicans unveiled allows insurers to charge older consumers as much as 5 times more for coverage than younger people. Under the Affordable Care Act, that ratio is 3-to-1.

In addition, the bill would probably lead to more plans offering large deductibles before insurance kicks in to help cover medical expenses, Levitt says.

And, if you now qualify for tax credits to help pay for insurance, the financial help available under the Republican plan may be far less generous. Tax credits are made available based on age and income. Individual credits ranging from $2,000 to $4,000 will be available to people earning up to $75,000, and $150,000 for people filing taxes jointly. The family maximum for credits is $14,000.

In addition, the cost-sharing subsidies that lower out-of-pocket expenses for people who earn less than approximately $30,000 annually and who buy silver-level plans on the Affordable Care Act insurance Marketplace are eliminated effective 2020.

Could my benefits change?

The proposed legislation doesn’t end the requirement that insurers cover a base set of essential health benefits for plans sold in the private market. This includes services such as maternity care, mental health benefits, and preventive services at no charge. However, the Trump administration can propose regulations that begin to dismantle this part of the law. Given the controversy over contraceptives, for example, many experts view this as one of the law’s most vulnerable provisions.

“The administration has the authority to pull back on the contraception requirement,” Levitt says.

In addition, the bill freezes funding for Planned Parenthood for a year. That, along with the repeal of the Affordable Care Act’s Medicaid expansion, is likely to hurt low-income women who disproportionately seek health care services there.

Will the debate have any effect on employer insurance this year?

“It would be difficult for employers, and undesirable, to change things in the middle of the plan year,” Blumberg says.

However, the bill immediately repeals the Affordable Care Act’s employer mandate, which requires companies with more than 50 workers to provide health benefits or pay a penalty. Most large employers offered health insurance before the health law and are likely to continue doing so.

However, the bill repeals Obamacare’s small-business tax credits starting in 2020. This tax credit helped some smaller companies afford coverage for their workers.

Regardless of the potential changes to employer coverage, Blumberg says, “I think they will evolve more slowly.”