A released Monday by three Senate Republicans may reveal聽how the party will handle the issue for the 2014 elections and beyond.
Photo by Karl Eisenhower/KHN
Sens. Orrin Hatch of Utah, Tom Coburn of Oklahoma and Richard Burr of North Carolina unveiled a legislative framework that would scrap much of the 2010 health聽law, replacing those provisions with ones the lawmakers say will increase consumer choice and reduce health care costs.
“With our plan, we’ve shown once again that by empowering Americans — not Washington — with the right tools and information, they will make the best informed health care decisions for themselves,” Hatch said in a statement.
It would repeal the health law鈥檚 requirements on individuals and employers to purchase health care coverage. It would scrap the law鈥檚 Medicaid expansion and give states more control of Medicaid, scale back the size of tax credits to help people buy health insurance and scrap the law’s聽new taxes and fees. It would also eliminate the health insurance marketplaces set up under the federal health law.
Insurers would still be prohibited from imposing lifetime limits on coverage. Plans would be required to offer dependent coverage up to age 26, although a state could opt out of enforcing that provision on the insurers it regulates.
Insurers could charge an older person no more than five times what they charge a younger person — the health law only allows insurers to charge up to three times more to older people — but states could impose rating rules that were more or less restrictive. 聽Subsidies would be based on age聽 — not income — and be available to those up to 300 percent of the poverty threshold,聽not 400 percent as the health law does.
Individuals who maintain continuous coverage could not be charged more for a pre-existing medical condition, but if they have a gap in coverage they could be subject to medical underwriting, where insurers could charge them more for coverage based on their medical history.
The proposal would not change the long-standing practice of allowing employers to fully deduct the cost of providing聽health insurance. However, some employees聽getting very generous coverage would have to pay taxes on the value of some benefits. The proposal would cap the tax exclusion for an employee’s health coverage at 65 percent of an average plan’s cost.
鈥淭his step is necessary and important, because economists across the political spectrum largely agree that the current distortion in the tax code helps to artificially inflate the growth in health care costs,鈥 according to the Senate GOP blueprint.
Senate GOP aides said the plan鈥檚 drafters did not want to discourage employers from offering health insurance, but instead wanted to create pressure from employees to reduce the cost of that coverage.
President Barack Obama鈥檚 health law includes a so-called on plans that cost more than $10,200 for an individual or $27,500 for a family.聽 In 2018, those plans will incur an excise tax of 40 percent on the amount of the premium that exceeds those thresholds.
Hatch, Coburn and Burr would keep the health law鈥檚 Medicare policy changes and its in provider cuts on the idea that any discussion of Medicare changes 鈥渟hould be considered in the context of reforms to improve Medicare and improve its insolvency,鈥 according to the proposal.
