State of the Affordable Care Act

The repeal process begins in Congress.

The Affordable Care Act (ACA) has not been repealed yet, but Congress has taken the first step toward doing this.

One week before President Donald Trump’s inauguration, Congress adopted a budget for fiscal year 2017. This action now gives Congress the opportunity to use special procedural rules to pass legislation reconciling federal taxes and federal spending on government programs, like Medicaid and Medicare, with the newly adopted budget targets. This process is known as “budget reconciliation.” Budget reconciliation legislation can be passed with 51 votes in the Senate, instead of the 60 votes usually needed to end debate and pass a bill.

Major policies have been enacted in reconciliation bills, including parts of the Affordable Care Act itself. Now, the same process is being used to deconstruct the ACA.

Over the coming days, Republican members of Congress will develop reconciliation legislation meeting the new budget targets and, most importantly from their perspective, eliminating key parts of the ACA. Congressional leaders want to get this legislation on the president’s desk for him to sign into law by Feb. 20.

The final bill is expected to look much like the one Congress passed a year ago, which then-President Obama vetoed in January 2016. That reconciliation bill would have immediately ended or phased out several key components of the ACA that impact psychologists’ reimbursements and their practices:

  • The individual and employer mandates to purchase health insurance.
  • Risk adjustment payments to insurers faced with beneficiary populations that, on average, use medical services at a higher rate than other populations.
  • Premium tax credits and cost-sharing subsidies to help low-income individuals purchase insurance.
  • Small business tax credits.
  • Expansion of Medicaid eligibility to individuals up to 133 percent of the federal poverty level.
  • The requirement that Medicaid expansion plans cover mental health services.

Not all of ACA’s provisions can be repealed using this process. Senate rules stipulate that reconciliation legislation can only contain provisions that affect federal deficits. Changing other parts of the ACA that don’t directly affect federal spending — such as the requirement that private sector health plans cover an essential benefit package — will require 60 votes in the Senate, and thus must have bipartisan support.

Replacement plan?

House and Senate leaders promise that they will develop an ACA replacement plan sometime in the future, perhaps as late as 2019. However, this would not be soon enough for the millions of Americans who would be affected if parts of the ACA are repealed. The nonpartisan Congressional Budget Office estimates that the reconciliation bill from the last Congress, if enacted today with no ACA replacement, would result in 18 million people losing health insurance in the first new plan year following enactment. Additionally, premiums in the individual insurance market could rise between 20 percent and 25 percent higher than what exists under current law.

The process for repealing the Affordable Care Act is becoming increasingly chaotic. Given the stakes, the APA Practice Organization is joining a wide array of other groups in urging Congress not to repeal the Act without simultaneously adopting a comprehensive replacement plan. We ask psychologists to stay informed and engaged as this new health care reform process continues over the coming weeks and months. For more information, email the APA Practice Organization Government Relations Office.