June 24, 2016

Republicans Release Details on Obamacare Alternative

Speaker Paul Ryan (R-WI) laid out the House majority party plan June 22 to repeal and replace Obamacare as described in a long-awaited “white paper” showing voters what House Republicans would do if given the chance to repeal the health care law.

Though House Republicans have voted to repeal Obamacare dozens of times, the lack of a consensus on a GOP alternative to Obamacare has hamstring party leaders since the Affordable Care and Patient Protection Act was signed into law in 2010.

The 37-page plan pledges a double digit percentage reduction in average health care premiums for consumers and to bend the health care cost curve, but did not delve into detail on such issues as dollar amounts and who exactly would be covered (or maybe more importantly, not be covered) by the new plan. Ryan framed the new paper as a starting point — a broad outline that the committees with jurisdiction would have to hammer out next year, if there is a GOP president who would sign off on a congressional repeal of Obamacare.

The GOP proposal starts with a transition period to phase out Obamacare and phase in the new plan. It would encourage people to have insurance coverage with the help of refundable tax credits adjusted for the beneficiary’s age. It would encourage small group health plans and provide $25 billion in incentives to state governments to set up high-risk insurance pools. The tax benefit for employer-sponsored insurance would be capped to discourage plans that enable indiscriminate health care spending, offering an alternative to Obamacare's Cadillac tax, which Congress has suspended.

In place of Obamacare's individual mandate, the plan would prohibit insurance companies from denying patients coverage or charging them more because of pre-existing conditions, but only if they keep continuous insurance coverage, though they could switch plans or carriers. It would also allow young adults to stay on their parents' health plans until age 26, a benefit that stood out as one of the most popular features of Obamacare.

The Republican plan would allow insurers to sell health care insurance policies across state lines, and medical liability laws would be reformed. States would get block grants to administer Medicaid with caps on how much could be spent per person. Accommodations would be made for high-cost patients.

Regardless of the terms of a formal Republican plan to replace Obamacare, repeal of the health care law still would be enormously difficult, even if Donald Trump, the presumptive GOP presidential candidate, is elected. Aside from the inevitable political battle, there are practical legislative roadblocks as well. For example, there is no realistic scenario in the foreseeable future that would give the GOP the 60 votes in the Senate needed to approve legislation without a filibuster threat, especially considering that most pundits believe the current Republican Senate majority of 54 seats will diminish, rather than grow, after November’s general election.

The ACR will continue to monitor the Republican plan and any legislation that may evolve from it. Look to Advocacy in Action for ongoing information and analysis.