Here's How the GOP Wants to Replace Obamacare
Finance Committee Republicans have been working for a while on a new health care plan. But first they need the Supreme Court to rule against the current law.
Sen. Richard Burr has been huddling with other Republicans to develop an alternative health care path.(Brendan Smialowski/Getty Images)
First the Supreme Court has to overturn Obamacare's federal subsidies. Then the Republicans will go to work.
No one outside the Court's walls knows if it will issue a devastating blow to the Affordable Care Act, but Republicans have a strategy to capitalize on it just in case. They feel fairly confident thatKing v. Burwellwill go their way—i.e., that the justices will say the law does not allow subsidies for people who buy insurance on federal exchanges —and they have a response ready.
The chances that Republicans will actually agree amongst themselves on an Obamacare replacement are exceedingly slim, and even if they manage that and get something approved by both chambers of Congress – which may require the use of the special budget tool known as reconciliation – an awful lot of things would have to go right for their plan to work.
Those steep odds haven't dissuaded the GOP from at least trying. Their first step will be to propose freezing enrollment exactly where it is. No one would be forced to drop an ACA health plan even if they can't get subsidies to pay their premiums. Congress will provide, Republicans say. At least for 18 months or so. The next step comes in 2017, when a new president is ushered in. Under this master plan, a GOP Congress will then put forth a market-based health care proposal. In theory – and it's a theory Democrats would certainly dispute -- it won't matter whether the White House is occupied by a Republican or a Democrat. The GOP's Obamacare "replacement" will be the only solution available.
This is the health care scheme that has come together piece by piece as the Obamacare foes in Congress have matured from tantrum-throwers to calculating strategists. The overall goal hasn't changed—to get rid of Obama's health care law. But the thinking about what to offer in its stead is only now starting to gel in the GOP caucus.
The nugget of the Republicans' answer to the ACA was hatched eight years ago, well before Obamacare was conceived. Two veteran conservatives—Sens. Richard Burr of North Carolina and Tom Coburn of Oklahoma—believed it should be just as easy for an individual to buy health insurance as it is for a worker to sign up with an employer. The two lawmakers worked steadily on a proposal to use tax credits, cost-cutting tools like high-risk pool sharing, and health savings accounts to bring down premiums.
Burr recently described the proposal this way: "We've balanced the difference between employer-based coverage and individual-based coverage."
Burr kept refining the proposal even after Coburn retired in 2014. He sought support from Sen. Orrin Hatch of Utah well before it became clear that Hatch would chair the Senate Finance Committee. "Orrin has always had a deep interest in health care," Burr toldNational Journal."He has a very talented health care staff. We went in there and said, 'Hey, shoot holes in this. And if you can't find any, cosponsor with us.' And they couldn't find anything."
Lo and behold, Hatch signed on. The Republicans took control of the Senate, and Hatch became chairman of the committee through which all health care bills must pass. "Yeah, we got lucky," Burr said with a smile.
Hatch and Burr are now the two principal operators of the "replace ACA" scheme. They got a big political boost earlier this year when Rep. Fred Upton, the House Energy and Commerce Committee chairman, signed on. Upton's thumbs-up showed that the GOP means business on health care, even in the boisterous House. Upton's sponsorship also signaled a shift among rowdier House Republicans away from their laser focus on ACA repeal toward a measured solution. Importantly, it showed that the GOP is willing to admit that the health care system needs some attention from Congress.
Finance Committee Republicans also see Upton's participation as a way to show off the power they can wield when the House and Senate leaders of correlating committees work closely together. In the past, Senate Finance chairmen and House Energy and Commerce chairmen sometimes seemed like they were on separate planets, even if they were in the same political party.
Burr says Upton's support is no accident. "Fred and I were on Energy and Commerce together," he said, referring to his own time in the House. "This begins to create a platform within the House that we're able to get people familiar with the structure of the plan."
The Burr/Hatch/Upton proposal puts on display the GOP's fundamental philosophy on health care. Not surprisingly, it is diametrically opposed to Democrats' views. Republicans believe that if you make coverage affordable, more people will buy it. They do not believe in mandating that people have insurance or dictating how health plans should look, as the ACA does. And they want states to take the lead in making individual plans easier for people to get. In keeping with their small-government credo, they want the federal government's role in health care to be much smaller than it is now.
Acknowledging consumers' desire not to get gouged, Republicans have built a few Obamacare-like protections into their plan. For example, no one could be denied coverage based on a preexisting condition. Period. No asterisk. Parents would be able to cover their children until age 26. (That one does have an asterisk: States could opt out.) Insurance companies would be barred from kicking people off their plans if they make too many claims.
This is complex legislation with a lot of moving parts, including shifts in the tax code that might make some tax purists nervous. That's why Burr says Republicans are simply laying the groundwork now for 2017 implementation. Even though it's hard to imagine Congress passing major legislation ever again, Burr is confident that's how this will go down. "We got to where we are through a process of elimination. It's not that we woke up one day and said, 'Gosh, here's the model that we need to use.' It was because we eliminated everything else," he said.
Now Republicans just need to wait for one last elimination. It will have to come from the Supreme Court.
This article has been updated.
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