Prohibiting discrimination against pre-existing conditions is one of the most popular provisions of the Affordable Care Act (ACA) that is also part of the House Republican replacement bill, the American Health Care Act (AHCA).
The Grand Canyon Institute estimates that approximately 50,000 Arizonans age 50 or older would face significant jumps in their premium costs and out of pocket expenses such that under the AHCA they are very likely to no longer be able to afford health insurance. Middle income younger adults, a healthier demographic, would find more incentive to purchase plans under the AHCA than under current law.
Prior to the ACA, people with pre-existing conditions would obtain health insurance that had periods of noncoverage for that condition or were denied coverage entirely. This impacted people particularly in the individual market. Essentially people paid differently or received different coverage based on their health-risk (or status).
Preventing this kind of price and coverage discrimination is a godsend to those who need it, but it’s not free. The question is who pays for it.
How would enrollees fare with the AHCA? Table 4 (graphically reproduced below) from the Congressional Budget Office cost study of the AHCA gives an approximate comparison of how people at difference ages with subsidies fare compared to the up to those not receiving subsides fare under current law.
The results are dramatically different depending on your income and age as shown in the graphical depiction of Table 4 from the Congressional Budget Office which compares a lower income individual at 175% of the federal poverty level (FPL) with a middle income individual at 450% of the FPL.
The ACA limits insurers to charging older adults to no more than three times what they charge young adults. The AHCA adjusts that ratio to 5:1. Consequently for older adults in 2026, their premiums are higher, and even though middle income older adults receive a subsidy, the subsidy part is eaten up by both the higher premiums and declining coverage (actuarial), so on average older adults with middle incomes and higher are not better off.
This is the first in a series of blogs on healthcare related to the possible repeal and replacement of the Affordable Care Act.
Prepared by Dave Wells, Ph.D., Research Director, Grand Canyon Institute. (602) 595-1025 ext. 2, email@example.com.