Washington Update

Republicans Offer an Alternative to the Affordable Care Act

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Sens. Richard Burr (R-NC), Tom Coburn (R-OK) and Orrin Hatch (R-UT) have unveiled the Patient Choice, Affordability, Responsibility, and Empowerment (CARE) Act with the idea of repealing the Affordable Care Act and offering this plan in its place. Some highlights of the bill follow:
  • The proposal would repeal the ACA’s requirements on individuals and employers to purchase health care coverage. Also, it would eliminate the health insurance marketplaces set up under the ACA. 
  • Lifetime limits would still be prohibited and the proposal would ensure the ability to keep dependent coverage up to the age of 26, although a state could opt out of enforcing dependent coverage on the insurers that it regulates.
  • Individuals could not be charged more for preexisting conditions unless they have a gap in coverage at which time they could be subject to medical underwriting where insurers could charge them more for coverage based on medical history.
  • Employers could fully deduct the cost of providing health insurance.  However, some employees getting generous coverage would have to pay taxes on the value of some benefits. 
  • The ACA’s ban on charging an older, sicker person more than three times what a younger, healthier person is charged is replaced with a 5:1 ratio, and states would be able to decide whether they want a different rating rule. 
  • The proposal envisions adopting or incentivizing states to adopt a range of solutions to tackle the problem of so-called “junk lawsuits” and defensive medicine. 
Given the fact that any proposal that seeks to repeal and/or radically modify provisions of the ACA face a certain veto by President Obama, the prospects for the proposal’s serious consideration and passage are not promising.

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