Under the Republican plan to replace the Affordable Care Act, Americans who receive health insurance through their employer could see their healthcare costs skyrocket when they desperately need care most.
A largely overlooked amendment to the GOP’s plan, the American Healthcare Act (AHCA), first noted by the Wall Street Journal on Thursday, opens a loophole that would enable large employers to drop coverage of 10 so-called “essential benefits” established under the ACA, or Obamacare, including trips to the emergency room, hospitalization, prescription drugs, and maternity care.
To understand how this works, we have to get into the health legislation weeds for a moment—bear with us. OK, so, 159 million Americans receive health insurance through their employers, not from the Obamacare marketplace. But Obamacare applies to larger employers (companies with 50 or more full-time employees), too. That means large employers are prevented from putting lifetime limits on essential benefits. So, once employees meet their deductible, their insurance must cover 100 percent of the costs that fall under the essential benefits category.
Under the Republican plan, however, states are allowed to opt-out of Obamacare insurance regulations, which means some states could choose to eliminate the requirement that insurance through large employers cover some or all essential benefits. The AHCA also allows insurance companies to choose from any state’s benefit requirements. So if, say, Alabama chooses to free insurers from covering all 10 essential benefits, large employers in any state could choose to offer plans that also waive essential benefits coverage. The plans would likely be less expensive, sure, but one trip to the hospital could negate the monthly cost savings and send countless Americans into unavoidable, crushing debt.
Now, employers may not choose this route given that high-quality benefits are a way to draw high-quality employees. But costs savings are cost savings, and experts say 59 percent of employers imposed a lifetime limit on insurance coverage before Obamacare went into law.
In case you’re thinking that essential benefits likely won’t apply to you, here’s the full list of what insurers must cover 100 percent after the deductible (though some limits for certain benefits do exist):
- Emergency room services: Treatment due to the need for emergency care.
- Hospitalization: All the care you receive in the hospital, including surgeries and medication administered in the hospital.
- Laboratory services: All the testing you receive to diagnose or properly treat an illness.
- Maternity care and care for newborns: Prenatal care, delivery, and care for newborn babies.
- Mental health care and addiction treatment: Diagnosis and treatment for mental illness or substance addiction.
- Outpatient care: Care you receive from your regular doctor as well as hospice services and other categories.
- Pediatric services: Care for infants and children.
- Prescription drugs: Any medication a doctor prescribes you.
- Preventive and wellness services, chronic disease treatment: Care you receive to prevent or detect illnesses, such as physicals and cancer screenings, as well as treatment of chronic diseases like diabetes.
- Rehabilitation: Rehabilitative services, either physical or mental, that you receive after an illness or injury.
The push to drop essential benefits came as a result of opposition from the House Freedom Caucus, a voting bloc of Republican lawmakers. The House of Representatives is scheduled to vote on the AHCA on Thursday.
