Republicans in Congress have published a replacement for Obamacare, arguing it is a consumer-centered alternative to the outgoing administration's signature health care plan.
The American Health Care Reform Act of 2017, announced Jan. 4, would give states block grants for Medicaid and allow insurers to sell plans across state lines. The bill also would allow people to access an association health plan and expand health savings accounts
It would also give individual consumers tax deductions to help buy coverage and scrap the tax exclusion for employer-based plans.
The Affordable Care Act would be scrapped.
Republican Study Committee leader Rep. Mark Walker (R-NC) said this act, sponsored by Rep. Phil Roe (R-TN) is the “most impressive and the most popular alternative health care legislation.”
“Dr. Phil Roe is uniquely qualified to lead our efforts to restore sanity to health care, and change the focus of our system away from bureaucratic mandates to compassionate care for patients by trusted doctors — paid for in a responsible way,” Walker said.
However, the head of a centrist Washington D.C-based think tank said the health care plan threatens the very foundation of coverage in place for decades. Proposed tax deductions and the undermining of employer-based coverage will leave many older Americans struggling to find insurance at affordable prices, said David Kendall, the founder of Third Way.
“As a practical, political consideration, it is not even in the ball game,” Kendall told Patient Daily following the unveiling of the plan. “Republicans have been operating in a policy-free zone. It’s a lot harder to craft a health care policy people are going to find acceptable. They have been living in a bubble, and that bubble is about to burst.”
Kendall described the proposal as “not just a radical departure from Obamacare, but from what we had before Obamacare.”
“It will change coverage for 80 percent of people and it threatens the very foundation of coverage in America,” Kendall said. “The way it would do that is it eliminates the tax advantages in buying coverage through your employer and introduce the individual tax deduction."
He said that is fine for younger, healthy people who will have a “big reason” to buy coverage on their own. And it is proposed to eliminate regulation of pricing, insurance companies will have an incentive in charging them less. Everybody else, including workers who have held employer-based insurance for decades, will be on their own and will have to find coverage outside.
“It will mean a massive unwinding of employer-based health coverage,” Kendall said. “It might be good for the young and healthy, but we do not stay young and healthy forever.”
Kendall said, he cannot see this act passing. It’s like the Cadillac Tax -- expensive plans that limit tax breaks -- but 100 times worse, he said.
Kendall said mainstream Republicans and President-elect Donald Trump's nominee for secretary of Health and Human Services Tom Price are not close to the positions taken by the study committee.