Senate Releases Draft of Better Care Reconciliation Act (BCRA)
July 7, 2017
In late June, the U.S. Senate released their proposal to repeal and replace the Affordable Care Act (ACA), with the Better Care Reconciliation Act (BCRA). The Senate bill is very similar to the proposal passed in the House of Representatives called the American Health Care Act (AHCA).
The BCRA contains the following ACA provisions with no change:
Coverage for adult children up to age 26
No pre-existing condition limitations, coverage must be provided for pre-ex
Guaranteed availability and renewability of coverage
Out of pocket maximum rules for cost sharing limits for Essential Health Benefits (EHB) for non-grandfathered plans
EHB packaged benefits for individual and small group remains
The age ratio would shift from 3:1 to 5:1 and states would be allowed to set their own limits
The new proposal would push the effective date of the tax back even further to 2026
Provisions of the ACA the BCRA would change:
Repeal the Employer and Individual Mandate by setting the penalty to $0
These changes would apply retroactively for months beginning after December 31, 2015.
BCRA removed the late entrant surchage that the AHCA would have allowed insurers to add 30% to premiums for applicants with a lapse in coverage
Replace Health Insurance Subsidies for Individuals effective 2020
This is replaced with a tax credit
Expansion of Health Savings Accounts (HSA)
Increase Maximum contribution allowed by eligible participants in an HSA to $6,550 single (currently $3,400) and $13,100 family (currently $6,750).
Allow both spouses over age 55 to make catch-up contributions to the same HSA
Starting in 2018, allow over-the-counter medications as an eligible expense for HSA
Decrease tax rate back to pre ACA rate for distributions taken for non-qualified medical expenses
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