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Feb
4

The GOP’s Alternative to Obamacare

Three republican senators have proposed a bill – the Patient CARE Act – to replace PPACA aka Obamacare.

Kudos to Senators Burr Coburn and Hatch for their efforts – and for staying away from the useless ideas of selling insurance across state lines, high-risk pools which are never adequately funded, and that favorite non-solution, tort reform.

In a nutshell, the GOP bill does away with most PPACA regulations including the mandate, reduces the tax break on employer-sponsored insurance, does away with Medicaid expansion, and gives low income folks tax credits to buy insurance.  There’s not a lot of detail, and it’s clear this is a work in progress.  I would note the GOP’s claim that their bill expands coverage without increasing taxes is sophistry;  according to many in their party, eliminating a tax break IS raising taxes.

There is no mechanism or approach or tools that would reduce health care costs, no assurance that those with pre-existing conditions will get coverage (unless they constantly maintain insurance, something that many folks don’t do), no control over benefit design (which is skillfully employed by insurers to discourage the unhealthy from signing up)

While a home-team analysis indicates the GOP bill will reduce uninsurance by about the same amount as Obamacare, the analysis isn’t credible.  For one thing, the “coverage” provided under the GOP bill would be a LOT thinner than that provided under Obamacare – they’d have to be, as the maximum credit for young singles would be $1,560, hardly enough to pay for anything but the skimpiest of catastrophic coverage.  This may be “insurance” but it certainly isn’t “coverage” .  In addition, doing away with the Medicaid expansion would dump millions of just-covered folks back on the safety net, aka emergency rooms, charity care, and community health centers that have been hammered by budget cutbacks.

 

Finally, the provider, payer, information technology, supplier and health system communities have all been working feverishly to prepare for and implement Obamacare.  This train left the station four years ago, and Burr, Coburn, and Hatch are just now showing up trackside with a revised itinerary.

Moreover, the passengers on this train – the middle class, health care providers, and older folks – are going to be adamantly opposed to the GOP plan as it:

  • raises taxes on the middle class;
  • undoes Medicaid expansion thereby harming health care providers; and
  • increases insurance costs for older people.

Politically brilliant it’s not.

As Jonathon Cohn notes; “It would have been a lot more productive if these three senators, or any other Republicans, had been similarly constructive back in 2009…”

He also thinks it is better late than never – I disagree.

Obamacare is the law of the land.  It is not going to be repealed.  The triad would have better spent their time working on something more productive; say immigration reform or revamping the tax code.  Alas, this is an election year, and the GOP bill is a political ploy.

But it’s not a very smart one.

What does this mean for you?

Not much.

 

 


3 thoughts on “The GOP’s Alternative to Obamacare”

  1. Actually Joe, I think it means a great deal to all of us. Exposing the plan to the light of day as you do is a great service to those who wouldn’t otherwise be following politics or who would only be exposed to the ‘talking points’ or ‘sound bites’ allowed to receive air time on what these days passes for news programming. You however do a good job of comparing and contrasting and while neither plan is very good at cost controls, at least you’re keeping us focused on that and that matters very much to everyone….or it should. Thank you.

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Joe Paduda is the principal of Health Strategy Associates

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