Bill Overview
Title: Health Care Equality and Modernization Act of 2022
Description: This bill repeals the requirement for large employers to offer affordable coverage to full time employees and makes other changes to the health insurance system. Specifically, health insurance is no longer required to cover preventive care at no cost or include the essential health benefits. Individuals enrolling in health insurance who have not maintained continuous coverage over the previous 12 months are charged an extra 20% on premiums for each consecutive year without coverage, unless the individual is subject to similar state incentives to maintain coverage. States may enroll uninsured residents in high deductible health plans. Individuals must be permitted to opt-out of this coverage. The Department of Health and Human Services (HHS) must develop a risk adjustment mechanism for health insurance in the individual market. For residents of a state to qualify for premium subsidies or the health insurance tax credit in this bill, the state must permit health insurance with an annual limit on benefits to be sold on its exchange. The bill establishes an advanceable, refundable health insurance tax credit for taxpayers enrolled in coverage that does not cover abortion except in certain circumstances. States may (1) apply to HHS to use unclaimed health insurance tax credits for indigent health care; and (2) enroll Medicaid-eligible individuals in health insurance that qualifies for the tax credit instead of in Medicaid, at the individual's option. The bill establishes Roth HSAs (health savings accounts) for paying certain medical expenses and health insurance premiums. The bill eliminates the tax deduction for medical expenses. Finally, the bill also changes federal Medicaid payments into block grants.
Sponsors: Rep. Sessions, Pete [R-TX-17]
Target Audience
Population: People enrolled in or potential consumers of health insurance systems globally
Estimated Size: 125000000
- Repealing the mandate for large employers to offer affordable coverage will primarily impact employees of large companies, especially those who are currently receiving employer-sponsored health insurance.
- The change in preventive care coverage will affect everyone purchasing health insurance in the individual market as well as through employers, as they may now have to pay out of pocket for preventive services.
- Higher premium charges for those not maintaining continuous coverage will affect those with gaps in their insurance history, penalizing them financially.
- Uninsured individuals in states that choose to enroll them in high deductible health plans will be directly affected, as they may face new out-of-pocket costs.
- The requirement for state exchanges to allow the sale of plans with annual limits could impact all individuals purchasing through these exchanges, potentially exposing them to higher costs if they have significant health events.
- The bill's impact on Medicaid by converting payments to block grants will affect all current and potential future Medicaid recipients.
- The creation of Roth HSAs might impact middle to upper-income individuals who have the means to save for medical expenses.
- Eliminating the tax deduction for medical expenses will affect those with significant medical expenses who previously itemized these deductions.
Reasoning
- The policy impacts a diverse range of individuals, including employees of large companies, uninsured individuals, Medicaid recipients, and those buying individual insurance plans.
- The bill includes several provisions that could financially impact individuals, especially those with gaps in insurance or significant medical expenses.
- Those using the health insurance marketplace, Medicaid, or employer-sponsored plans are key populations to consider.
- Individuals with higher incomes might be less impacted due to their ability to save in Roth HSAs, whereas low-income individuals face more risk.
- The long-term changes to Medicaid funding could significantly impact its recipients, so understanding this dynamic is essential.
Simulated Interviews
HR Manager (Dallas, Texas)
Age: 32 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 10/20
Statement of Opinion:
- I am worried that without the requirement for my employer to provide affordable coverage, our health insurance choice or costs might get worse.
- Not covering preventive services as part of basic insurance will mean more out-of-pocket expenses for routine checkups.
- There could be increased financial stress due to potential insurance cost jumps.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 5 | 7 |
| Year 5 | 5 | 7 |
| Year 10 | 6 | 8 |
| Year 20 | 7 | 8 |
Self-employed (Los Angeles, California)
Age: 45 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 10.0 years
Commonness: 8/20
Statement of Opinion:
- The policy badly impacts my affordability for preventive care which keeps my condition manageable.
- If my insurance costs rise due to gaps, my financial situation could worsen.
- I'm already worried about annual limits that might leave me with huge bills.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 4 | 6 |
| Year 3 | 4 | 7 |
| Year 5 | 3 | 7 |
| Year 10 | 2 | 8 |
| Year 20 | 3 | 9 |
Freelancer (Portland, Oregon)
Age: 29 | Gender: other
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 12/20
Statement of Opinion:
- I'm already financially strained and the penalties for insurance gaps make it difficult to catch up.
- I'm concerned about being automatically enrolled in a high deductible plan I can't afford.
- The overall policy seems to be more punitive.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 4 | 5 |
| Year 2 | 3 | 5 |
| Year 3 | 3 | 6 |
| Year 5 | 3 | 7 |
| Year 10 | 4 | 7 |
| Year 20 | 4 | 8 |
Retired, former nurse (Miami, Florida)
Age: 60 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 10.0 years
Commonness: 15/20
Statement of Opinion:
- The shift to Medicaid block grants worries me as it might affect my coverage.
- Without the medical expense deduction, my tax burden might increase.
- I'm nervous about any reduction in my healthcare coverage.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 5 | 7 |
| Year 3 | 5 | 7 |
| Year 5 | 4 | 8 |
| Year 10 | 4 | 8 |
| Year 20 | 5 | 9 |
Tech Entrepreneur (Denver, Colorado)
Age: 37 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 2.0 years
Commonness: 5/20
Statement of Opinion:
- I could benefit from Roth HSAs for tax-free savings.
- I am worried about preventive care costs being out of pocket.
- The opportunities for my business' insurance needs may change.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 8 |
| Year 2 | 7 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 9 | 9 |
| Year 20 | 9 | 9 |
Corporate Lawyer (New York, New York)
Age: 52 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 3.0 years
Commonness: 3/20
Statement of Opinion:
- Elimination of the tax deduction for medical expenses means a higher tax load.
- I'm concerned about potential weakening of currently stable employer health plans.
- I'm hopeful that HSA changes might mitigate the impact.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 8 |
| Year 2 | 7 | 8 |
| Year 3 | 7 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 9 |
| Year 20 | 9 | 9 |
Entry-level Marketing (Chicago, Illinois)
Age: 23 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 13/20
Statement of Opinion:
- I might face a penalty if there's a gap in coverage between jobs.
- This policy seems set up to make health care more of a burden.
- I am concerned about any reduction in coverage or higher costs upfront.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 5 | 6 |
| Year 2 | 5 | 7 |
| Year 3 | 5 | 7 |
| Year 5 | 6 | 8 |
| Year 10 | 7 | 8 |
| Year 20 | 7 | 9 |
Small Business Owner (Houston, Texas)
Age: 40 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 5.0 years
Commonness: 7/20
Statement of Opinion:
- I'm concerned about potential higher costs of providing health insurance to employees.
- Changes to preventive care coverage could affect our business' health plan expenses.
- I see possible challenges in managing employee benefits if employer mandates are repealed.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 6 | 7 |
| Year 5 | 6 | 8 |
| Year 10 | 7 | 8 |
| Year 20 | 7 | 9 |
High school teacher (Phoenix, Arizona)
Age: 50 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 3.0 years
Commonness: 10/20
Statement of Opinion:
- State mandates might change, affecting my stable insurance coverage.
- There could be a shift in benefits or additional costs with preventive care.
- The financial penalties for insurance lapses are concerning.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 6 | 7 |
| Year 2 | 6 | 7 |
| Year 3 | 7 | 8 |
| Year 5 | 7 | 8 |
| Year 10 | 8 | 9 |
| Year 20 | 8 | 9 |
Retired educator (Boston, Massachusetts)
Age: 68 | Gender: female
Wellbeing Before Policy: 8
Duration of Impact: 2.0 years
Commonness: 6/20
Statement of Opinion:
- The shift to block grants might affect future beneficiaries, implying potential risks.
- Elimination of medical deductions is unfavorable for me financially.
- My income stability is paramount, and I'm wary of changes.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 9 |
| Year 20 | 9 | 9 |
Cost Estimates
Year 1: $26500000000 (Low: $24000000000, High: $29000000000)
Year 2: $27000000000 (Low: $24500000000, High: $29500000000)
Year 3: $27500000000 (Low: $25000000000, High: $30000000000)
Year 5: $28000000000 (Low: $25500000000, High: $30500000000)
Year 10: $30000000000 (Low: $27500000000, High: $32500000000)
Year 100: $45000000000 (Low: $42000000000, High: $48000000000)
Key Considerations
- The bill modifies several components of the health insurance market, potentially causing widespread shifts in coverage compositions and financial costs.
- Block grants for Medicaid may shift costs unpredictably due to state-specific management and economic circumstances.
- Eliminating tax deductions and introducing tax credits require careful monitoring to assess broad fiscal impacts.
- Penalties for lapse in coverage are intended to minimize uninsured periods but could raise costs for individuals, necessitating increased federal subsidies or tax credits.
- The risk adjustment mechanism and high-deductible health plans may influence market behavior and coverage choices, impacting cost predictability.