American Health Care Act: Michigan Impacts
According to the Congressional Budget Office (CBO), the American Health Care Act would have differential impacts on individuals depending on factors such as age, income, geographic location, plan choice, and overall health. In general, the CBO concluded that people who are older, sicker, or receive their coverage through Medicaid will likely see higher costs or lower levels of benefits, while people who are higher income, younger, and healthier are likely to face lower costs or tax savings. In this fact sheet, we summarize the potential impact of the American Health Care Act in Michigan.
Of those who bought coverage in Michigan’s individual market in 2016 many of the:
- 86,000 people age 18-34 might have received higher tax credits and/or lower premiums relative to the ACA
- 9,000 people with household incomes above 400% of the federal poverty level ($47,520 for an individual in 2016; currently not eligible for tax credits under the ACA) would receive tax credits under the AHCA (those with annual incomes below $115,000)
- Estimated 187,000 off-exchange enrollees currently not eligible for tax credits would receive tax credits under the AHCA
- 100,000 people age 55-64 who selected coverage through Michigan’s Health Insurance Marketplace would face higher costs relative to the tax credits they would receive under AHCA
- 233,000 people with household incomes below 250% of the federal poverty level ($29,700 for an individual in 2016) would face higher costs over time with potentially lower tax credits and/or when cost-sharing reduction subsidies are repealed in 2020
- 533,000 people who had individual coverage would be at risk of facing a 30% surcharge with a gap in coverage of more than 63 days
Of those with Medicaid coverage in Michigan in 2016:
- Among the 649,000 Healthy Michigan Plan beneficiaries, those with a gap in coverage of more than 30 days would be at risk of losing coverage beginning in 2020
- 1,800,000 “traditional” Medicaid beneficiaries would be at risk of losing benefits and/or seeing provider payments cut beginning October 1, 2019 when per capita cost caps would begin to take effect
Beyond these coverage changes, individuals with annual incomes above $200,000 and couples with annual incomes above $250,000 would see tax cuts as a result of repealing the ACA’s taxes in ACHA. In 2015, approximately 150,000 households in Michigan earned annual incomes of $200,000 or more (data on incomes above $250,000 is not available). In addition, 209,000 Michigan households who paid a tax penalty for not having insurance (the individual mandate penalty) in 2015 would see tax savings as a result of repealing the individual mandate penalty under AHCA.
For more details, see CHRT’s companion piece, “American Health Care Act: Key Provisions and Michigan Implications.”