ACA Repeal and Replacement Update – April 20, 2017


Top takeaways from the week:

1) House Republicans have announced a deal on an amendment to the American Health Care Act (AHCA) 2) the White House has not definitely pledged to continue paying cost-sharing reduction payments, prompting a number of letters from stakeholders, and 3) CMS has released a final Market Stabilization rule that seeks to strengthen the ACA marketplaces.


Despite ongoing difficulty in gaining consensus around a plan, President Trump has called for Congress to continue work on health care reform prior to moving on to tax reform, noting in a speech on Tuesday that “We’re working with Congress on tax reform and simplification, and we’re on time, if we get that health care approval…” Meanwhile, while out of town on recess, many House Republicans have faced contentious town halls focused on health care, but have continued to negotiate a deal that would bring together both conservative and moderate factions of the party.

Today, details emerged about the deal being negotiated between House Freedom Caucus Chair Meadows (R-NC) and Tuesday Group Co-Chair MacArthur (R-NJ), which would leave in place the ACA’s core protections for people with pre-existing conditions and essential health benefits (EHBs), but would allow states to request “limited waivers” from certain federal standards, including EHBs and community rating rules. It is unclear whether this amendment can garner sufficient support from those originally opposed to the AHCA, but is likely to continue to be discussed as Congress resumes work next week.

The most pressing issue for many stakeholders in the near-term, however, is whether the Administration will continue to provide cost-sharing reductions (CSRs) to health plans. President Trump has indicated that he might use CSR funding as leverage to bring Democrats on board with health reform, however, Democrats have countered that they intend to make CSRs a top priority during next week’s budget negotiations in advance of the expiration of the continuing resolution on April 28.

Health issuers as well as state insurance commissioners have called for greater clarity on the issue, as issuers are due to submit their proposed 2018 participation and rates for review by CMS by June 21. Although several health issuers met with CMS Administrator Verma on Tuesday, they left with little indication as to whether the Administration would continue to pay the subsidies.

A number of health care groups sent a letter to President Trump on April 12, including AHIP, Blue Cross Blue Shield Association, American Academy of Family Physicians, American Hospital Association, Federation of American Hospitals, the American Medical Association, American Benefits Council, and the U.S. Chamber of Commerce, noting “the most critical action to help stabilize the individual market for 2017 and 2018 is to remove uncertainty about continued funding for cost sharing reductions (CSRs).” Letter:

State insurance commissioners wrote a letter to Congressional Leaders yesterday urging Congress to fully fund CSR for fiscal year 2017 in the upcoming continuing resolution, and to commit to fully funding the program for 2018, arguing that “funding the cost-sharing reduction payments will go a long way toward stabilizing the individual markets in our states while legislative replacement and reform options are debated in Congress.” Letter:

Senate Action –

On April 13, Sen. Tester (D-MT) sent a letter to President Trump highlighting the need for a bipartisan health care solution that lowers premiums, limits out-of-pocket expenses for rural families, and expands access to health insurance. Press release: Letter:

Administration Action –

Meanwhile, CMS released a final rule on April 13 intended to help stabilize the ACA’s marketplaces through a shorter open enrollment period in 2017, pre-enrollment verification of eligibility for special enrollment periods, and additional actuarial flexibility in plan design, among others. In conjunction with the final rule, CMS also updated a number of QHP certification guidance documents.