House Republicans revealed draft legislation Monday evening designed to allay conservative lawmakers without spooking moderates, reassure wary voters, and not alienate Democrats too much.
Such is the balancing act of repealing and replacing Obamacare.
Party leaders released text of the American Health Care Act, which follows through on long-awaited vows to gut some of the Affordable Care Act’s controversial features, but also maintains certain taxes and spending for longer than the law’s toughest critics had wanted. The measure, which is focused on budget-related issues that require only 50 votes to pass the Senate, additionally provides tax credits for the purchase of health insurance, a replacement for Obamacare’s premium support that worries cost-conscious conservatives.
But House speaker Paul Ryan called the bill “a plan to drive down costs, encourage competition, and give every American access to quality, affordable health insurance.” It effectively nixes the individual mandate by reducing its penalty to $0, and does the same for a coverage requirement affecting employers with at least 50 full-time-equivalent workers. It also takes aim at almost all of the law’s remaining taxes, including those on tanning services and medical devices. But their repeal is delayed by a year, compared with draft legislation that was circulated last month. And the so-called “Cadillac tax” on high-cost health plans is only temporarily eliminated.
In another give and take for those on the right, the bill tweaks Obamacare’s premium subsidies until replacing them with age-based tax credits for insurance purchases, valued between $2,000 and $4,000 per individual and tied to inflation. Leaders of the House Freedom Caucus and Republican Study Committee have worried such a system would simply constitute a new entitlement. The act throws them a bone, phasing out the credit by 10 percent for every $1,000 above a $75,000 income threshold ($150,000 for joint filers).
They don’t seem eager to bite. Former Freedom Caucus chairman Jim Jordan, a frequent critic of GOP leadership on policy matters, reiterated the “entitlement” line about the credits to Politico in reaction to the plan.
Not all Republicans concerned about aspects of the party’s approach come from Jordan’s perspective, however. A quartet of senators from states that expanded Medicaid wrote Senate majority leader Mitch McConnell on Monday to criticize a previous draft of healthcare reform language for failing to “provide stability and certainty for individuals and families in Medicaid expansion programs or the necessary flexibility for states.” The HCA text maintains Obamacare’s Medicaid expansion for three years, in which the federal government absorbs a 90-percent share of medical expenses for new enrollees, significantly above the typical average.
GOP leaders touted other sources of flexibility for states contained in the act. It creates a $100 billion “Patient and State Stability Fund”, which governments could use to help stabilize and reduce health care costs and assist consumers with expenses. States would have to apply for approval and would be granted money based on a formula. Individuals and families receive an added bit of flexibility in their health care investments, as well: The measure nearly doubles the maximum contribution limits to health savings accounts.
The HCA groups together policies under the jurisdiction of the Energy and Commerce and Ways and Means Committees, both of which will hold markup hearings on Wednesday. However, it may still be in a formative stage. Onetime congressional healthcare expert and policy analyst Chris Jacobs noted that the Senate parliamentarian, which is responsible for determining what the upper chamber could consider under 50-vote-threshold rules—budget-related items in a process called “reconciliation”—might not have vetted the language yet. Any non-budget policy pertaining to Obamacare and new health care reform—regulatory matters, for example, on which Jeffrey H. Anderson has written—would be subject to a 60-vote Senate threshold, a higher standard necessitating bipartisan cooperation. The process is still absent a “fully drafted bill and complete … score” from the Congressional Budget office of its cost.
