American Health Care Act: Key Provisions and Implications in Michigan

March 17, 2017

The words "Affordable Care Act (ACA)" in black on white paper under a magnifying glass.In March 2017, House Republicans unveiled the American Health Care Act (AHCA), their proposal to replace the Affordable Care Act (ACA). On March 13, the U.S. Congressional Budget Office projected that under the AHCA, 14 million Americans would lose their health insurance in 2018, with the number of uninsured rising to 24 million by 2026. The following summarizes key American Health Care Act provisions and who in Michigan is primarily affected.

For instance, the first proposal summarized is a proposal to replace the ACA’s individual
mandate with a continuous coverage requirement. This proposal would mean that enrollees who experience a lapse in coverage longer than 63 days would pay 30% higher premiums for one year upon re-enrolling in individual coverage.

The  Michigan residents who would be most impacted by this ACHA proposal are individual market enrollees and those that experience spells of uninsurance. There were an estimated 533,000 enrollees in Michigan’s individual market in 2016. There is considerable churning of coverage within the individual market. Our latest survey shows that 5% of those with individual market coverage had spells of uninsurance within the past year.

In addition to these individuals, about 519,000 people in Michigan were uninsured in 2015 but had household incomes that could have qualified them for ACA tax credits. In 2017, the average annual premium for the second lowest cost silver plan in Michigan was $2,736 (before tax credits). A 30% continuous coverage surcharge would increase that annual premium to $3,557.

For more details, see CHRT’s companion piece on the impact of the American Health Care Act in Michigan.