In order to help defray at least some of the costs for those newly endangered sick people under the AHCA, the bill also provides $100 billion under the “Patient and State Stability Fund” to states to help manage some of the costs of the most expensive patients, including the creation of “high-risk pools.” The CBO concluded that the effects of this fund would likely not come close to offsetting the 24 million people fewer people it estimated would be covered under the law, but it became central to Republican efforts to make the AHCA more palatable. Ryan’s first manager’s amendment to the AHCA provided $85 billion in tax relief that he claimed would go toward defraying costs for sick individuals, but it would require restructuring in the Senate, and the actual mechanism by which it would do so is not yet known. A second manager’s amendment explicitly appropriated an additional $15 billion to the Patient and State Stability Fund for maternity, mental-health, and substance-abuse coverage.
The latest two amendments also revolve around that fund. One, from Representative Fred Upton ,gave the bill enough political strength to pass, but its addition of $8 billion to the Patient and State Stability Fund over five years is likely a drop in the bucket. Even with those added dollars, the fund will probably struggle to fulfill its mission of defraying costs. The MacArthur amendment added to the law last week was more consequential policy-wise, and would allow states that participate in the fund to relax community-rating requirements for exchange patients without continuous coverage. That means states could allow insurers on the exchanges to charge more (with no upper limit) for patients with pre-existing conditions, although they still cannot be technically denied coverage. The number of people affected by this provision would likely be small, especially since states may not want the political repercussions of allowing sick people to be charged more.
The MacArthur amendment also allows states to elect to define essential health benefits for exchange plans that receive tax credits. This could allow insurers to sell bare-bones plans on the exchange markets, and could also have effects on employer plans that use those plan offerings as benchmarks for what they cover. Lifetime limits and exclusions for certain employees for certain types of coverage might be back on the table. The plans available to those purchasing insurance in individual markets might offer little more than catastrophic coverage, if that.
All in all, the baseline projections of reducing coverage by over 20 million people and federal savings of $300 billion will still apply to the AHCA, which must be officially scored by the CBO over the next few weeks in order to pass by the reconciliation process in the Senate. If passed there and signed by President Trump, the Medicaid program will be slashed, and fewer older, low-income, and sick people will be able to afford insurance. The Patient and State Stability Fund will likely provide financial relief and affordable coverage for thousands of sicker Americans, but it still appears that more people of similar health status will be ejected into the ranks of the uninsured. Fewer people will be offered employer coverage as well, although it’s unclear how much changes in essential benefits will affect them. The amendments will mostly affect those at the extremes. “In terms of their marginal effect, it all depends on what states will take them up,” Guyer said.