Republicans Finally Tell Us How They Plan On Replacing The ACA

From the Washington Post

House Republicans on Monday released long-anticipated legislation to supplant the Affordable Care Act with a more conservative vision for the nation’s health-care system, replacing federal insurance subsidies with a new form of individual tax credits and grants to help states shape their own policies.

Under two bills drafted by separate House committees, the government would no longer penalize Americans for failing to have health insurance but would try to encourage people to maintain coverage by allowing insurers to impose a surcharge of 30 percent for those who have a gap between health plans.

The legislation would preserve two of the most popular features of the 2010 health-care law, letting young adults stay on their parents’ health plans until age 26 and forbidding insurers to deny coverage or charge more to people with preexisting medical problems. It would also target Planned Parenthood, rendering the women’s health organization ineligible for Medicaid reimbursements or federal family planning grants — a key priority for antiabortion groups.

Great… so more attacks on Planned Parenthood. Fucking wonderful…

Until now, the GOP had been intending to veer away from the ACA subsidies that help poor and middle-class people obtain insurance, insisting that the size of tax credits with which they planned to replace the subsidies should be based entirely on people’s ages and not their incomes. But the drafts issued Monday proposed refundable tax credits that would hinge on earnings as well as age — providing bigger credits for older and poorer Americans.

This big pivot, developed by the Ways and Means Committee under the guidance of House Speaker Paul D. Ryan (R-Wis.), stems from a combination of problems that were arising with the idea of age-only credits that would have been available to any individual or family buying insurance on their own, no matter how affluent.

The Republican plan would offer tax credits ranging from $2,000 per year for those under 30 to $4,000 per year for those over 60. The full credit would be available for individuals earning up to $75,000 a year and up to $150,000 for married couples filing jointly. The credits would phase out for individuals earning more — for each $1,000 in additional income, a person would be entitled to $100 less in credit, meaning a 61-year old could make up to $115,100 and still receive some credit.

The income-based phase-out of the credit allows the GOP plan to be funded without taxes on employer-provided insurance that had been considered earlier in the drafting process. In addition, the latest proposal would delay the ACA’s “Cadillac” tax, a levy on the most generous employer-provided health plans, until 2025. It also retains the tax exclusion for premiums paid for employer-provided health plans.

I don’t know enough about the technical stuff to say for sure, so I’ve no doubt commenters can correct me, but… this actually doesn’t look… terrible? The ACA, while not perfect, is still better, though.

Or I could just read the article…

Compared with the ACA’s subsidies, the tax credits would go to more people but provide less financial help to lower-income people, according to Larry Levitt, senior vice president of the Kaiser Family Foundation.

Meanwhile, the portion of the legislation drafted by the Energy and Commerce Committee would substantially redesign Medicaid in a way that attempts to balance the GOP’s antipathy toward the ACA’s expansion of the program against the concerns of a significant cadre of Republican governors — and the lawmakers from their states — who fear losing millions of dollars that the law has funneled to help insure low-income residents.

Medicaid would be converted from its current form of entitlement to anyone eligible into a per capita cap on funding to states, depending on how many people they had enrolled. In states that expanded Medicaid under the ACA, the government for now would continue paying for virtually the entire cost of the expansion.

Just go and read the whole thing…

We really are bounding backwards…


  1. Chris J says

    Could be wrong, but wouldn’t tax credits be completely useless to someone poor enough not to owe taxes? And wouldn’t tax credits be less and less helpful the fewer taxes someone does have to pay?

    Tax credits seem to simply help poor people less, whereas the current subsidies help poor people more.

  2. Chris J says

    Ok, I was a bit wrong. Tax credits can be “refundable,” meaning they can give you money back as a refund if they take your tax liability below zero. Both the premium tax credits from obamacare and these new tax credits are refundable.

  3. drascus says

    The problem though is that someone living paycheck to paycheck may simply not have the money to pay for the health insurance, no matter how much they will get back at the end of the year.

    The subsidies reduced the up-front cost. The tax credits only refund the cost already paid, unless I misunderstand them.

    I’m actually surprised that insurance companies aren’t upset about this. The ACA subsidies amounted to a huge influx of government cash to them, the government paying part of the premiums for those who could not normally afford health insurance. If the subsidies go away, it seems like the insurance companies are losing both the subsidy money and the portion that the poorer citizens were paying.

    That’s got to be a net financial loss, so why aren’t they lobbying against it?

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