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Obamacare Replacement Puts Over 1M New Yorkers In 'Jeopardy,' Cuomo Says

Gov. Andrew Cuomo
Gov. Andrew Cuomo Photo Credit: Wikimedia Commons

A House Republican replacement plan for Obamacare (the Affordable Care Act) will place more than one million New Yorkers in "jeopardy," Gov. Andrew Cuomo argued in a press release sent out on Thursday.

"Health care is a human right, not a luxury," Cuomo said in a statement. "After seven years of progress under the Affordable Care Act, the Republican Congress has proposed an inadequate, ill-conceived and unacceptable plan that places the coverage of more than 1 million New Yorkers in jeopardy and, once fully phased in, would shift more than $2.4 billion in costs onto taxpayers and hospitals each year."

The governor bases his assertions on a new study from the state's Department of Health, which analyzed the projected fiscal impact of the proposal. The report, Cuomo says, will shift more than $4.5 billion in costs to state and local taxpayers, as well as hospitals, over the next four years. Of that amount, an annual shift of more than $2.4 billion would occur beginning in 2020.

A copy of the Department of Health's report can be found here.

The plan, called the American Health Care Act (AHCA), is being pushed by House Speaker Paul Ryan and members of the chamber's GOP leadership. The plan has received an open mind as a starting point, although not an explicit endorsement, from President Donald Trump, according to news reports.

The proposal would keep several core aspects of Obamacare. The pieces include a ban on insurance companies refusing policies to people with pre-existing conditions, retaining the ban on lifetime benefit caps for policies and allowing for people to stay on their parents' plans until age 26.

Major changes proposed in the AHCA, however, include repealing Obamacare's tax penalty for those who do not have insurance, replacing it with a 30-percent premium hike for those who do not maintain continuous coverage for more than roughly two months. It also would replace the current formula for individual-plan tax credits, which are tied to income, with a system of tax credits that go higher with age.

The report estimates that New Yorkers would have a loss of $400 million in tax credits due to the formula change.

The AHCA would also freeze new enrollment in Obamacare's Medicaid expansion by Jan. 1, 2020, and make a radical alteration of the federal government's Medicaid funding to states. Currently, the federal government's funding is tied to actual expenses. Under the AHCA, it would shift to providing a fixed "per capita" amount to each state, which is also known as block granting.

Cuomo also blasted a provision in the AHCA that would defund Planned Parenthood. 

It is not clear whether the AHCA will make it through Congress and to Trump's desk for signing. National news reports note that conservative hardliners in the House Freedom Caucus oppose the plan as-is, arguing that it is too similar to Obamacare. A handful of more moderate Republicans in the Senate may potentially have concerns over Medicaid, according to news reports, citing past remarks from some. 

Democratic votes in Congress for the AHCA are expected to be few to none, according to reports.

Critics of the proposed replacement argue, according to news reports, that eliminating the mandate will create what is called "adverse selection," where healthier people withdraw and drive up the costs for sicker patients who remain in the insurance pools. Critics also blasted the Medicaid funding change and the overhaul of the tax credits, according to reports, arguing that this will result in a lack of coverage that is affordable for lower-income households.

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