Today a trio of experienced Senate Republicans-Tom Coburn, Richard Burr, and Orrin Hatch-have put forth the most thoughtful and constructive plan yet developed to repeal and replace Obamacare. The plan seeks to ensure that as many Americans have health coverage as Obamacare does. The vast majority of the Republican base is employed or retired; these active GOP primary voters are sometimes unaware of the degree to which their health coverage is heavily subsidized by the tax code or financed by the government. The Republican Study Committee, a caucus of House Republican conservatives, put out a plan last fall that would replace Obamacare by capping the employer tax exclusion, and making a standard deduction for health coverage available to everyone. The best thing about this approach is that it would reduce spending and reduce the deficit; Obamacare is deficit neutral, but it substantially increases federal health spending, along with its massive expansion of federal health-care regulation. A separate cohort of Republican health plans have taken a different approach. While the plan would repeal Obamacare, it would preserve some of the law's most popular features, such as its ban on lifetime limits on insurer payouts, and its requirement that insurers cover adult children younger than 27. "Our proposal caps the tax exclusion for employee's health coverage at 65 percent of an average plan's cost" today, and then grows the cap at the rate of the Consumer Price Index-a common measure of inflation-plus one percent (Roy, 2014). What are the key differences? The CBH plan would grow its subsidies and tax exclusion cap at a higher rate than Obamacare does-CPI+1% vs. CPI+0% for Obamacare. If health insurance is less costly, then federal spending on health insurance can shrink alongside. The plan is not perfect, no health reform plan can be, but Roy (2014) listed some things in his article that could be changed for improvement. “An attractive feature of...
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