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Key Differences Between The AHCA & BCRA

On Thursday, the Senate released a draft of its healthcare bill, the Better Care Reconciliation Act of 2017. The BCRA is somewhat comparable to the House's American Health Care Act, passed in May. Although the two bills are similar, there are some crucial differences between the AHCA and the BCRA. Here are a few notable distinctions.

Perhaps most importantly, the Senate's proposed bill will make more longterm changes to Medicaid than the AHCA. Medicaid has always been an entitlement program where anyone who meets the requirements for enrollment can do so. If costs of treatment rise, states receive more federal money to cover healthcare needs. States cover much of the funding for their Medicaid programs, with the federal government matching a percentage depending on the wealth of the state.

Both the AHCA and the BCRA aim to turn Medicaid into a program with per-capita funding. This means that the federal government would supply a fixed amount of money for each state's program, based on enrollment numbers instead of healthcare costs. Funding growth would then be set at a rate according to inflation and consumer price index (CPI) of medical care. However, the BCRA would lead to far more restriction on growth of Medicaid funding, eventually basing funding growth rates on the CPI of all goods (CPI-U), instead of medical care (CPI-M).

Another difference is in the bills' approaches to subsidies. The BCRA, like the AHCA, would retain the ACA's structured subsidies for low and moderate income people, designed to help them purchase private health insurance. However, the AHCA based subsidies solely on age categories, whereas the BCRA takes other relevant factors into consideration, such as age, income, and geographical location. In this sense, it acknowledges the role that lower incomes play in the rate of uninsured Americans.

The BCRA also has a different approach than the AHCA when it comes to repealing the individual mandate, which is the legal requirement that everyone have at least basic health insurance coverage. Both bills reduce the penalty of having no coverage to $0, but the BCRA has no alternative motivator to buy health insurance.

The AHCA has a proposed penalty for individuals who have gone more than 63 days without coverage, thus incentivizing the public to buy health insurance. Without such an encouragement mechanism, the concern is that the BCRA will lead to cost spikes in premiums within the health insurance market.

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The final significant difference between the two bills comes in the form of pre-existing condition coverage. The current law requires that all insurance plans include 10 essential benefits, including prescription drugs, mental health coverage, and maternity care. Additionally, plans are not allowed to discriminate based on pre-existing conditions and charge sick people more for their coverage.

Under the AHCA, states can apply for waivers that allow them to remove any of the ten essential benefits or restrictions against charging for pre-existing conditions. However, these waivers are only applicable to people who failed to maintain continuous healthcare coverage. The BCRA still allows state waivers for essential benefits, but there is no option to reject or discriminate against pre-existing conditions.

While minute, these differences can have serious implications for our nation's healthcare. It's best people acquaint themselves with the details now, before it's too late.