5 ways the new health care bill could change things for workers | Ladders

Older workers and those who get seriously sick are likely to be the most affected.
Age in the Workplace

5 ways the new health care bill could change things for workers

On Monday, House Republicans revealed the American Health Care Act, their plan to repeal and replace what’s known as Obamacare, or the Affordable Care Act.

The proposed bill is expected to be voted on by two House committees on Wednesday.

Already, it’s controversial.  House Oversight Committee Chairman Jason Chaffetz faced criticism on Tuesday after he told CNN that Americans who found health insurance expensive “should invest in their own healthcare” instead of “getting that new iPhone.” (In 2015, health care spending was estimated to be $10,000; the latest iPhone costs around $649.)

There are a few things we don’t know yet. The Congressional Budget Office has not yet given an official estimate on how much the plan will cost and how many people will it cover in comparison to Obamacare, which insured 20 million Americans who didn’t have health insurance before.

We’re in uncharted territory—Congress has never reversed a major social benefits program once it has been implemented.

To help you figure it out, here are some big takeaways on how the GOP health care bill could affect workers.

High penalties if you don’t have health insurance

The authors of the new bill want to encourage people to maintain their insurance coverage. Generally, that’s been done through financial penalties for people who let their coverage drop.

In Obamacare, that meant paying a one-time penalty to the Internal Revenue Service if you didn’t have health insurance.

The AHCA takes a new tack: it imposes a 30% surcharge on premiums for people who go without health coverage for over two months. The surcharge lasts for a full year.

So, instead of paying the fine to the IRS, essentially Americans will pay it straight to insurance companies.

Who the higher premiums will affect most: workers who are between jobs, Americans with chronic illnesses and disabilities that directly cause longer job gaps, or people who switch from full-time to part-time work and cannot afford coverage afterward. Recent research found that up to 85% of cancer patients have to stop working while getting treatment with absences that last up to six months.

In short, the new bill has advantages for high-income workers and disadvantages for lower-income ones, as this full explainer from Vox makes clear.

Age makes a significant difference in what you will pay for health coverage

Older workers will be charged up to five times more by insurers, according to the new bill. That’s higher than Obamacare, which charged older Americans up to three times as much as young people.

The tradeoff: older Americans get higher tax credits than younger Americans (which is likely to be small comfort to older workers who can’t afford the upfront cost of coverage).

Obamacare provided subsidies based on income. The new bill uses age as the differentiator in coverage.

The AHCA would give refundable income-capped tax credits based on age, so that a 61-year-old would get $4,000 to put towards insurance and a 29-year-old would get $2000.

Another issue of concern to older workers: the new bill would end Medicaid enrollment expansion—which aims to help lower-income individuals and families—in 2020.

In fact, by 2024, the Medicaid trust fund is likely to dry up immediately under the new legislation, think tank Brookings said.

Adult children get to stay on their parents’ insurance

Three core aspects of the ACA stick around in the proposed new healthcare legislation. Families can keep their children on their insurance up until the age of 26, which acts as a safety net for you