If House Republicans want to make good on their campaign promises to repeal Obamacare, they probably have to do it soon. After canceling a planned vote in March, when it was clear the new bill would fail in the House, Congressional Republicans were back again for another try this past week, but again failed to call a vote, with House Speaker Paul Ryan announcing that he would not do so until the votes were there for passage.

The two new Republican versions of the bill are at least as controversial as Obamacare itself, and their effect on your small business may depend how big you are. Both versions remove the employer mandate requiring businesses with over 50 employees to provide them with health insurance. It may also result in lower premiums for your younger and healthier employees. But it will likely make it more difficult for older employees or those with health conditions to afford insurance. Either way, the measure stands a good chance of coming to a vote this week.

On Thursday, Congress is scheduled for a one-week recess, and Republican House members are likely to face tough questions about Obamacare from their constituents when they head home to their districts. The new bill might also lose momentum during that break. That leaves some political analysts speculating that this coming week is the Republicans' likeliest chance to pass their Obamacare replacement, called the American Health Care Act.

And they're making progress toward their goal. Republican officials declared over the weekend that they were "very close" to having the votes they needed for AHCA's passage in the House. Vice President Mike Pence hinted on television that a vote is imminent. House Majority Leader Kevin McCarthy was even more specific at a recent Tea Party event: "Watch next week--and you will see the repeal and replace of Obamacare." It's not certain that this confidence is warranted--the vote count in the House still looks very close--but the bill's prospects are dramatically better than they were back in March.

The objectors worked it out.

Why all this optimism for a bill that was DOA a month ago? A lot has changed since then. Back in March, AHCA was scuttled by the Freedom Caucus, a group of about three dozen right-wing Republican Representatives who disliked some of the provisions of the original bill and particularly feared it would not do enough to curb the continued rise of health insurance premiums.

But when Ryan, with President Donald Trump's support changed the bill to appeal to the Freedom Caucus, moderate Republicans objected on the grounds that too many people insured under Obamacare would no longer be able to afford coverage, especially older people and people with pre-existing health issues.

So Trump--the author of The Art of the Deal--made a smart move: He got the two groups talking to each other. They have worked out a new compromise version of the AHCA that allows states to request waivers from the law, which the federal government can grant. With that new provision in place, the AHCA won endorsement from the Freedom Caucus last week. And Representative Tom MacArthur, co-chair of the House group of moderate Republicans known as the Tuesday Group also supports the bill.

But what will it do?

Right now, the answers to that question are very murky. It seems likely that changes will be fairly moderate under AHCA in Democrat-led states, some of which had some version of an Obamacare-like law in place even before 2010 when Obamacare was passed. But states will have the right to ask the federal government for waivers under AHCA which would allow insurance companies to sell insurance that does not follow the rules set in place by Obamacare, such as requiring coverage for people with pre-existing conditions, coverage for certain essential forms of care, and the rule against charging people for insurance based on the state of their health.

States can qualify for waivers for a wide variety of reasons, such as if the move would reduce premiums, increase enrollment, or stabilize the market (a difficult thing to measure). So it seems likely that states requesting waivers would get them, at least as long as Republicans control the White House. And it seems likely that states with Republican leadership would request waivers.

What happens to people with pre-existing conditions in states that have waivers and no longer require insurers to cover those people for the same premiums as their healthier peers? Well, that's where things get complicated. The compromise bill requires these states to offer insurance through either state or federal "high-risk pools" that would guarantee everyone the opportunity to buy coverage. Pence, Trump, and MacArthur insist that these pools will mean people with pre-existing conditions can still buy affordable coverage.

But others say that's not so clear. First of all, protections only apply to those who haven't had a gap in coverage, and with higher premiums (not to mention the confusing state of the U.S. health insurance industry) it might be difficult for people, especially those with lower incomes, to maintain that gap-free coverage.

And medical groups are skeptical that the high-risk pools, even with promised federal subsidies, will provide coverage for people with pre-existing conditions that they can actually afford. A statement from the American Medical Association warns: "There is also no certainty that the requirement for states to have some kind of reinsurance or high-risk pool mechanism to help such individuals will be sufficient to provide for affordable health insurance or prevent discrimination against individuals with certain high-cost medical conditions."

In other words, since Americans have never seen a state or national health insurance high-risk pool, it's difficult or impossible to know how or whether it will work. But if House Republicans have their way, we may all be about to find out.

Published on: Apr 30, 2017
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