The WasteWatcher: The Staff Blog of Citizens Against Government Waste

Time to Move Forward and Pass an Alternative to Obamacare

The WasteWatcher is the staff blog of Citizens Against Government Waste (CAGW) and the Council for Citizens Against Government Waste (CCAGW). For questions, contact blog@cagw.org.


Today, the Senate leadership released their revisions to H.R. 1628, the Better Care Reconciliation Act (BCRA) and there are some important changes.  Whether the new language will be enough to garner the votes needed to pass a bill remains to be seen.  Importantly, the legislation continues to eliminate many of the onerous taxes and provides relief from the mandates contained in the Patient Protection and Affordable Care Act (ACA), or Obamacare, and reforms Medicaid.  The Council for Citizens Against Government Waste announced its support today for the legislation.

In addition, Sen. Ted Cruz’s (R-Texas) amendment to create “Freedom Plans” was accepted.  As a result, he has stated he will support a motion to proceed on the bill.  His amendment would allow an insurer to sell any kind of plan that a person may want off an exchange, as long as the insurer sell a sufficient number of Obamacare-compliant plans on an exchange within a certain rating area.  The Freedom Plans would be regulated by the individual state.  The exchange Obamacare compliant plans will continue to receive federal premium tax credits and dedicated sources of federal funds.

Here are some highlights:

  • The bill repeals the Obamacare individual and employer mandates by zeroing out the fines for not purchasing insurance;
  • It provides advanceable and refundable tax credits to help people with incomes between 100 to 350 percent of the federal poverty level pay for their insurance premiums (currently individuals with incomes of $12,060 to $36,180);
  • It repeals the taxes on health insurance coverage, over-the-counter medicines, Health Savings Accounts (HSAs), Flexible Spending Accounts (FSAs), prescription drugs, medical devices, and delays the implementation of the tax on high-cost, employer-sponsored health coverage (Cadillac Tax);
  • It expands the use of HSAs and FSAs, and for the first time, allows HSAs to be used to pay for premiums of high-deductible health plans;
  • It returns power to the states by allowing them to use waivers that currently exist in federal law.  State governments will have the flexibility to write the rules for insurance coverage in their state and can allow insurers to design the kinds of healthcare plans consumers want to buy, not what Washington, D.C. bureaucrats think is best;
  • It provides $182 billion in grant funding to help states stabilize their insurance markets, assist in getting low-income people get off of Medicaid, which has been shown to consistently provide inferior care, and obtain private insurance instead.  The funding is designed to encourage state-based reforms in health insurance as they move away from Obamacare's dictates.  It also addresses many senators concerns about the opioid addiction epidemic in their states with additional funding of $45 billion; and,
  • It reforms Medicaid and slowly eliminates the reckless federal expansion of the program under ACA, with its high matching contributions, currently at 95 percent.  This is important because the program has been declared unsustainable and it is rife with waste, fraud, and abuse. (Medicaid improper payments reached $36 billion in 2016.)  It puts Medicaid on a budget by changing it from an open-ended entitlement and instead, adopts a per-capita federal contribution based on the medical inflation rate, eventually moving to the urban inflation rate.  In 2020, states would also be allowed to choose a block grant and will have more flexibility in designing their Medicaid programs.  These types of reforms have been proposed for years by conservative Republicans.

 

We shall know shortly if at least 50 Senators will support the bill.  Vice President Mike Pence could cast the 51st vote.  It is also important to keep in mind any Senator will be able to offer an amendment, once the debate begins, to change the bill.

It’s time to move forward and get healthcare reform done.

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