Six years after promising a plan to “repeal and replace” the federal health law, House Republicans are finally ready to deliver.
The 37-page white paper, called “A Better Way,” includes virtually every idea on health care proposed by Republicans going back at least two decades. It would bring back “high risk pools” for people with very high medical expenses, end open-ended funding for the Medicaid program and encourage small businesses to band together to get better bargaining power in “Association Health Plans.”
What the plan does not include, however, is any idea of how much it would cost, or how it would be financed. Also unclear is how many of the 20 million Americans who have gained coverage since the law took effect would be able to remain insured.
“It’s a framework,” a senior House Republican leadership aide said on a conference call with reporters Tuesday, with the specifics to be determined next year by congressional committees, assuming the GOP maintains its majority. He likened the document to the white paper issued just after President Barack Obama’s election by then-Senate Finance Committee Chairman Max Baucus, a Democrat. That document foreshadowed many of the key elements of the Affordable Care Act.
The plan starts with repeal of the health law and its requirements and taxes, but it would then put back many of its most popular elements: Allowing young adults to stay on their parents’ health plan to age 26; banning insurers from charging people with pre-existing health problems higher premiums; and forbidding insurers from dropping coverage if a policyholder gets sick.
It would repeal the current scheme of exchanges where consumers buy insurance and government tax credits to help moderate-income Americans pay their premiums if they don’t have an employer to help. Instead, everyone buying policies in the individual market would receive tax credits. Older people charged more by insurers would receive larger credits, though the House Republicans don’t specify how much.
But the GOP plan also would likely make insurance more expensive for older people by proposing a broader range for premiums based on age. Current premiums can vary only three-fold based on age, which is “driving out younger and healthier patients” who can’t afford them, the GOP aide said.
Under the plan, insurance companies could not charge higher rates to people with pre-existing conditions so long as they maintain continuous coverage, whether from an employer or in a policy they purchase themselves. The new high-risk pools would be available for those who have a break in coverage, or who fail to purchase during a one-time open enrollment under the plan.
The plan would get rid of most of the coverage requirements under the Medicaid program for the poor, so states could make them more or less generous than they are currently. It would also limit funding. States could opt for either a per-person cap or a block grant to spend much as they wish.
On Medicare, the proposal would encourage the existing movement of patients from the program’s traditional fee-for-service program to managed care plans, and would transition from the existing financing structure based on benefits to a controversial structure called “premium support” that puts cost-controlling responsibilities more on private insurance companies. That change has been pushed by House Speaker Paul Ryan for nearly a decade.
Backers of the existing health law were quick to criticize the GOP outline.
“The proposal introduced by Speaker Ryan is nothing more than vague and recycled ideas to take health insurance away from millions and increase costs for seniors and hardworking families,” said White House Assistant Press Secretary Katie Hill.
Families USA Executive Director Ron Pollack, who pushed hard for passage of the Affordable Care Act, said: “Make no mistake, Ryan’s approach is not a better way forward, but a bitter path backward that returns us to the bad old days when vast swaths of Americans were left to the tender mercies of the insurance industry and could not afford needed care.”