House Republicans Unveil Obamacare Replacement
House Republicans on Wednesday are set to unveil a proposal to repeal and replace the Affordable Care Act with new healthcare policies aimed at reducing government regulation and lowering costs.
The plan focuses first on repealing the ACA, popularly called Obamacare, including the employer and individual healthcare mandates, a goal Republicans have repeatedly attempted for six years, without success. It then includes a wealth of reforms, including giving individuals and states more flexibility on healthcare plans; providing tax credits to keep healthcare affordable; allowing coverage across state lines; giving states flexibility with Medicaid funding; and creating private options for Medicare patients, among other policies.
It’s the fifth policy proposal Speaker Paul Ryan and his colleagues have introduced this month – and perhaps the most anticipated given that the House has voted dozens of times to repeal the ACA but has struggled to coalesce around a comprehensive replacement. Previous proposals released this month focused on poverty, national security, federal regulations and constitutional authority. A tax reform plan will be announced later this week.
Like the other proposals, the healthcare reform plan does not present actual legislation, but rather a broad outline of Republican policy ideals ahead of this year’s election, with the goal of turning the plan into legislation that could be enacted under a Republican president next year. The report was released by Ryan’s office Tuesday ahead of a panel discussion on healthcare policy featuring the speaker and other House members at a Washington think tank Wednesday afternoon.
The report says it represents “the beginning of a conversation, not the end. In contrast to Obamacare, our plan will serve as the foundation for multiple pieces of straightforward legislation, not a comprehensive, overly complex, and confusing 3,000-page bill. Successfully transitioning these ideas into action requires a step-by-step approach.”
The 37-page report lays out a number of reforms to different aspects of healthcare policy and advocates for “consumer-directed healthcare.” The proposal includes increasing use of health savings accounts, which are tax-free savings to pay for out-of-pocket healthcare costs. It offers a tax credit to those who don’t have insurance through their employer or government programs, and while it doesn’t specify the size of that tax credit, it suggests it would be large enough to “purchase the typical pre-Obamacare health insurance plan.”
The plan also pushes for allowing individuals to purchase insurance across state lines and allows small businesses to pool together to sell cheaper health plans to employees.
The Republican proposal also offers alternative ways to keep coverage affordable and widespread despite advocating the repeal of the ACA, which has helped insure 20 million new Americans. One of the cornerstones of Obamacare was a guarantee that those with pre-existing conditions would receive affordable coverage and not be turned away or dropped by insurance companies, and the Republican plan attempts to continue that standard. The proposal would not allow companies to drop coverage of individuals after they get sick, even when they renew their plans.
The Republicans also propose a policy that if individuals maintain continuous healthcare coverage – either through an individual plan or an employer – their rates cannot be increased because of a pre-existing condition, even if they switch plans. It would also allow children to stay on their parents’ healthcare plans through age 26, a popular provision in the ACA.
To mitigate any insurance losses from the ACA repeal, Republicans propose a single open enrollment period for those without coverage during the transition to the new laws.
Another major proposal is significant funding for high-risk pools, which provide federally subsidized healthcare for individuals with pre-existing conditions who have extremely high premiums. It’s a long-standing Republican plan intended to remove those people from the general insurance market to keep premiums low for others. The new Republican plan proposes $25 billion in funding for high-risk pools over a decade.
In terms of government programs, Republicans are proposing giving states significantly more flexibility with Medicaid, with each state having the option of either a block grant with a set amount of federal funding for the program or a “per capita allotment,” which would provide funding based on each state’s beneficiaries.
It also proposes giving seniors on Medicare the option of getting private healthcare plans paid for or offset by Medicare, intended to help keep the program efficient for future beneficiaries. The report stressed that it was not a “voucher program,” but that the payment would go directly to the insurance plan.
Overall, the reforms amount to a monumental shift in healthcare policy. A senior GOP leadership aide, during a conference call with reporters, said there wasn’t a timeline for creating the legislation for the proposals or implementing them, though there would be a transition period built in. The goal in releasing the proposals now is to give House Republicans specific policies to campaign on this fall.
Republicans’ chances to actually to turn these proposals into legislation that has any chance of becoming law, however, will depend entirely on Republicans’ ability to win the White House as well as maintain control of both chambers of Congress. Without securing both branches of government this November, these long-awaited Republican proposals will be left on the drawing room floor.