GOP lawmakers: Scrap Obama health law, use tax credits
Senate Finance Committee Chairman Orrin Hatch, R-Utah, and Sen. Richard Burr, R-N.C., a Finance panel member, also wrote the proposal.
The plan — it's not in legislative language and may not be anytime soon — erases the existing law's coverage requirements for individuals and employers. It eliminates the state and HealthCare.gov federal insurance marketplaces where insurance can be purchased and ends virtually everything established by the health care law, including taxes it imposes on medical devices and other things to finance enlarged coverage.
Also gone would be the health care overhaul's expansion of Medicaid, the federal-state health insurance program for the poor. Instead, states would be given more freedom to decide how to spend the program's federal funds.
Republican aides said the plan's sponsors would need to talk to congressional colleagues and governors, and possibly make changes, before translating their principles into a bill. That could be a drawn-out process, but it would further delay the political vulnerability possible when ideas are transformed into detailed legislation.
Further stretching the timeline is a Supreme Court decision, expected this June, on a case in which critics of Obama's law claim that many subsidies it gives millions of people to help them afford health coverage are illegal. Should the plaintiffs win, Congress might have to spend time rewriting parts of the statute.
Every voting Republican in Congress opposed the health care law when it was enacted. When the House voted this week to repeal the law — a measure unlikely to pass in the Senate and that faces a promised veto from Obama — only three Republicans voted no.
GOP aides said their proposal had no official estimates of cost or the numbers of people it would cover. They said they believed their plan would save money and be competitive with coverage under Obama's program.
As under Obama's law, insurers would be required to include children up to age 26 under their families' policies, though states could end that requirement. Unlike Obama's law, states could decide whether to provide maternity coverage.
People with pre-existing medical conditions could not be turned down for insurance, as long as they did not have a gap in coverage that lasted more than roughly two months, congressional aides said.
As with Obama's law, there would be no lifetime limits on coverage.
People working for firms with 100 or fewer employees would be eligible for tax credits to help pay for health care, as would people earning up to triple the federal poverty level. That would mean people earning up to approximately $35,000, and larger amounts for families, would qualify for some assistance.
For people who don't sign up for coverage, states would be allowed to automatically enroll some of them in plans. Such people, though, could completely opt out of coverage anyway.
To raise money, the GOP plan would impose taxes on the value of employer-provided health coverage exceeding $12,000 for individuals and $30,000 for families, amounts that would grow as inflation rises.
Limits would be placed on awards from medical malpractice lawsuits, and insurance companies would be allowed to sell policies across state lines. Republicans said both steps were designed to help lower coverage costs.