GOP draft for Obamacare replacement circulated

UPDATE — 2/28, 10:32 a.m. EST: Top congressional Republicans have announced their opposition to House legislation which would effectively replace the Affordable Care Act.

On Monday, two North Carolina congressmen, Republican Study Committee Chairman Mark Walker and Freedom Caucus Chairman Mark Meadows, said they oppose any healthcare bill that offers tax credits for purchasing insurance.

Following that announcement, GOP Sens. Ted Cruz, Rand Paul and Mike Lee said Tuesday they also will not support proposals which offer credits, insurance pools for unhealthy individuals and an increase in health savings accounts — calling such plans “Obamacare Lite”.

 

A draft of Republican proposals to dismantle the Affordable Care Act in the coming weeks emerged Friday, as the GOP and White House continue to compete with a due date for repeal and amid skepticism from some former lawmakers the contentious law will be replaced at all.

Under the GOP plan, the individual Obamacare mandate forcing the purchase of insurance is eliminated, tax credits based on age to help uninsured patients afford private insurance plans is introduced and subsidies which are often assailed by the GOP as inducement to remain outside the labor force are to be removed.

Similarly, the plan tackles Medicare and dramatically reduces or discards a number of taxes.  The proposal eliminates the Medicare surtax and will halt federal expansion of the program by 2020.

In a welcome move, the Republicans are offering bloc grants to any state which chooses to formulate state-run programs in order to reduce premiums and increase coverage.

In order to address states which have already expanded Medicare programs, the plan continues the Obamacare strategy to cap payments based on enrollees and, similar to the current law, would place a 30 percent charge on those who held coverage, dropped their plan and resumed coverage later.

Additionally, the draft places a cap on tax-exempt status for health care plans from employers above the 90th percentile, which is, in effect, a tax on princely healthcare plans.

Likewise, the GOP’s proposed measure will do away with  Obamacare’s “Essential Health Benefits,” which mandates insurance companies cover 10 services, such as prescription drugs, maternity leave, ambulatory services, lab and preventative services.  The elimination of this provision leaves states to decide.

Furthermore, the draft stamps out fines and penalties on larger companies which do not offer healthcare plans to its employees and will provide $10 billion yearly over 10 years to states in bloc grants to lower insurance costs.

The proposal follows former House Speaker John Boehner defining repeal efforts as “happy talk” and another former lawmaker, South Carolina’s Jim DeMint, calling on the GOP to simply send one of the Obama-era repeal bills to President Trump’s desk.

 

[AP] [RollCall] [Washington Times] [The Hill] [Photo courtesy Zero Hedge]