Senate Republicans announced Tuesday that their tax bill will include a repeal of the Affordable Care Act's individual mandate, in the latest move to dismantle parts of President Obama's signature healthcare law.
Congressional Republicans and the Trump administration have spent most of 2017 trying to repeal and undermine Obamacare. Their efforts to repeal and replace the law have been rather unsuccessful, so now they're moving toward executive actions and sneaking changes to the Affordable Care Act into other legislation.
Their target this time is the individual mandate, which requires almost every American to obtain health coverage or pay a penalty. (The penalty for this year is $695 per adult and $347.50 per child, with a maximum of $2,085 per household, or 2.5% of their income — whichever is greater.) The mandate has historically been one of the least popular parts of the healthcare law. But axing the policy would have a deep impact on the healthcare markets.
According to the nonpartisan Congressional Budget Office (CBO), eliminating the individual mandate would give Republicans an extra $338 billion over the next 10 years to help pay for the tax cuts they're proposing. And even though GOP lawmakers are into that possibility, repealing the mandate would also have a major impact in other areas: About 13 million people more would be uninsured by 2027 and premiums are projected to increase by 10% almost every year of the next decade.
But even though experts are conflicted over whether the individual mandate has been effective, they say that it's by far one of the main reasons young and healthy Americans join the health insurance markets in the first place. They don't want to pay a penalty, so they obtain coverage. But if that requirement is repealed, and there's no penalty for not having health insurance, they might opt out of participating in the exchanges. That would leave mostly older, sicker Americans in the market. As a consequence, insurers might find the exchanges less attractive and premiums could go up.
In a letter to Congress, a coalition made up of America’s Health Insurance Plans (AHIP), the American Academy of Family Physicians, the American Hospital Association, the American Medical Association, the Blue Cross Blue Shield Association, and the Federation of American Hospitals tried to dissuade lawmakers from eliminating the mandate.
"Repealing the individual mandate without a workable alternative will reduce enrollment, further destabilizing an already fragile individual and small group health insurance market on which more than 10 million Americans rely," the coalition of top health groups wrote.