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GOP Plan: Who Wins And Who Loses

An analysis by the Kaiser Family Foundation, pictured above, shows the differences among the tax credits Californians would receive under the Affordable Care Act versus the current Republican bill, the American Health Care Act. The bill is expected to come to a vote on the House floor on Thursday. (California Healthline is produced by Kaiser Health News, an editorially independent publication of the foundation.)

The analysis shows that older Californians with annual incomes under $50,000 have much more to lose in tax credits under the GOP proposal than anyone else. Younger people are slightly better off under the AHCA, except for those with incomes below $20,000.

Both the ACA and the AHCA rely on tax credits to help enrollees in the individual market pay for premiums. The tax credits under the ACA vary by family income and the cost of insurance where people live, as well as by age, and grow annually if premiums increase. The House leadership proposal, released on March 6, would provide tax credits that vary by age and grow annually with inflation. The proposal does not take insurance costs or income into account, except that credits would phase out once an individual’s annual income reached $75,000.

In both the ACA and AHCA, the tax credits are refundable, meaning people can obtain them as payments even if they don’t owe taxes.

Nationally, the GOP bill would provide nearly $600 billion in tax breaks over the next decade, almost all of it going to the wealthy, according to the nonpartisan Committee for a Responsible Federal Budget. As Julie Rovner, Kaiser Health News chief Washington correspondent reported, this is because Republicans are repealing nearly all the taxes that helped pay for the Affordable Care Act’s benefits, and the taxes mostly targeted higher-income people.

About 1.5 million people buy health insurance through the state’s exchange, Covered California, and the vast majority get federal subsidies.