Thursday, March 6, 2014

Beyond Repeal — A Republican Proposal for Health Care Reform — NEJM

Beyond Repeal — A Republican Proposal for Health Care Reform — NEJM
by Tim Jost // Washington & Lee School of Law

"By voting repeatedly to repeal the Affordable Care Act (ACA) over the past 4 years, Republicans have risked being identified as a party without a positive health policy agenda. On January 27, 2014, however, three Republican senators — Orrin Hatch (UT), Tom Coburn (OK), and Richard Burr (NC) — unveiled a proposal that would not only repeal the ACA, but also replace it with comprehensive legislation based on Republican health policy principles.1 Although the proposal recycles long-standing Republican prescriptions, it also offers new ideas.
The proposal would, like the ACA, use premium tax credits to make health coverage affordable for lower-income Americans. Unlike the ACA's tax credits, which are available to families with incomes of up to 400% of the federal poverty level ($95,400 for a family of four) and are based on the actual cost of health insurance in particular markets, the Republican proposal would help families with incomes of up to only 300% of the poverty level ($71,550), with phasing out beginning at 200%. The proposal would go beyond the ACA, however, by allowing employees of small businesses to use tax credits to purchase insurance through their employer, which would make small-group coverage more affordable.
The tax credits would be for flat dollar amounts, adjusted for age but not for regional cost variations. The amounts proposed would be adequate to purchase high-deductible coverage in some parts of the country but would fall far short of the actual cost of coverage in others.
Our health care system is unfathomably complex. Any reform will inevitably disrupt current arrangements and create winners and losers, as we are seeing with the ACA. The Republican proposal will give an advantage to some Americans and will put others at a disadvantage. In my opinion, Senators Hatch, Coburn, and Burr are to be commended, however, for moving beyond simply demanding repeal and putting out a proposal, the effects of which can now be debated."

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