When the House released its 1,990 health care bill, Rep. Mike Pence (R-IN) criticized the legislation for including “the mandatory world ‘shall’ in the bill 3,425 times.” Today, the Hill obtained the Republicans’ 230 page alternative, which the House leadership plans to offer as an amendment during floor debate.
The bill includes the word ‘shall’ 378 times, but does very little to expand access or lower health care costs. In fact, while the House bill incorporated numerous Republican ideas and provisions, the Republican legislation is a message amendment that translates Republican rhetoric against the Democratic proposal into legislative language. “The purpose of this Act is to take meaningful steps to lower health care costs and increase access to health insurance coverage,” the bill states, “without (1) raising taxes; (2) cutting Medicare benefits for seniors; (3) adding to the national deficit; (4) intervening in the doctor-patient relationship; or (5) instituting a government takeover of health care.”
Below is a summary of the Republican plan. In short, the amendment shifts the costs and risks of insurance onto individuals and divides the market into low-cost plans for the healthy and high-cost insurance for the sick:
Access to coverage:
- Establishes high risk pools for sicker individuals: State are required to establish high risk pools for Americans who cannot purchase insurance in the individual market due to pre-existing conditions, but nothing in the legislation prohibits the state pools from excluding coverage for the very condition that makes an individual eligible in the first place (as they do today.) The bill abolishes waiting lists and specifies that the pools must provide at least two coverage options, one of which must be a high deductible plan with HSA. Premiums can be set at no higher than 150% of (state) average. The federal government will provide $15 billion in funding.
- Healthier Americans can purchase coverage on the individual market: For Americans moving from group to individual coverage, the legislation eliminates the HIPAA requirement of having creditable coverage in the past 18 months to receive individual insurance market insurance. Annual or life time spending caps are also eliminated. However, the bill will allow insures to deny coverage for pre-existing conditions and charge very different rates based on gender and age.
- Health insurers can sell policies across state lines: The insurer only has to follow the rules of the state it declares to be its “primary” state, not of secondary states in which it can also sell policies. As a result, all policies will have a ‘buyer beware’ label warning consumers that the plan is “not subject to all of the consumer protection laws or restrictions on rate changes of the state.”
- Businesses can form association health care plans: The legislation creates rules for governing association health plans, which will allow small businesses to come together, by industry or trade, and form health plan through which they can purchase coverage for their employees. Association health care plans have sole discretion in selecting specific items and services that can be included as benefits (i.e. no minimum guaranteed benefit package, or minimum costs etc). The plans are to be operated by Board of Trustees who appoint the actuary to determine financial status and viability.
- Young adults can stay on their parents’ coverage: Dependent adults can stay on their parents’ plan until they are at least 25, although the language would allow a plan to increase that age.
Lowering health care costs:
- Offers bonuses for states that lower premiums, number of uninsured: Establishes state innovation program grants to reward states for lowering the cost of their premiums. Includes bonus for reducing the number of uninsured.
- Establishes a plan finder website: States contract with private entities to create a health “plan finder” website which do not directly enroll individuals in insurance plans.
- Malpractice reform: Specifies that claims must be filed within three years, and caps non-economic damages at $250,000.
- Enhances Health Savings Accounts: Enrollees can build their credit by contributing to their HSA and can use HSAs to pay for high deductible plan premiums. The bill extends the definition of a qualified medical expense.
- Employer wellness programs: Allows group and individual health plans to vary premiums and cost-sharing by up to 50% of value of benefits based on participation or lack of participation in a standards-based wellness program.
- Federal dollars can’t touch plans that offer abortion coverage: The bill does not allow federal funds to go to any insurance plan that offers abortion coverage. This means that a woman who wants to purchase a comprehensive health insurance plan would have to pay for the entire cost of the policy, even if she qualifies for subsidies and uses private premiums to pay for her abortion.