Amendment to the American Health Care Act


Amendment to the American Health Care Act

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On April 6, 2017, The House Rules Committee voted 9-2 passing an amendment to the American Health Care Act.  The amendment was submitted by Gary Palmer (R-AK) and David Schweikert (R-AZ).

The amendment would create an “Invisible Risk-Sharing Program” which would provide payments to health insurance issuers with respect to claims for eligible individuals in order to lower premiums in the individual market. Under the program, $15 million would be appropriated for the nine-year period beginning January 1, 2018 and ending December 31, 2026.

The Centers for Medicare and Medicaid Services (“CMS”) would act as the Administrator of the program and would be charged with establishing the program’s parameters within 60 days of its enactment. As the Administrator, CMS would define an “Eligible Individual” by developing a list of high-cost medical conditions that would automatically qualify individuals for the program. Eligibility would be determined through the completion of a “Health Status Statement” by individuals.  In addition to this automatic qualification, health insurance issuers would have the ability to voluntarily qualify individuals for the program.  Lastly, CMS would need to set the percentage of insurance premiums to be applied as well as the dollar amount and payment proportion meaning thresholds above which payments to health insurance issuers will be made and the percentage of the claims above these thresholds that will be paid.

The program is a type of reinsurance.  Under the amendment, states would have the ability to take over the program beginning with the 2020 plan year.  The House and Senate are currently on recess.

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