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Republican legislators are hard at work preparing the next draft of an Obamacare replacement bill — and a congressional aide recently gave me a walk-through of its four key policy proposals:
- Expanding health savings accounts. Federal law currently caps how much patients can put in these tax-advantaged health care accounts at $3,400 for individuals and $6,750 for families. Most Republican plans would like to move those numbers upward to go as high as current out-of-pocket maximum limits ($6,550 for individuals, $13,100 for families). Republicans currently believe this could be accomplished in reconciliation.
- Tax credits. Nearly every Republican plan continues Obamacare-style tax credits to make health insurance more affordable. The Republican tax credits we've seen so far, however, are significantly less generous than those in the Affordable Care Act. Trump endorsed the idea of tax credits in his address on Tuesday, but the Freedom Caucus has protested the provision as continuing an entitlement program from the Obama era. Politico reported early Friday that Republicans are exploring the idea of means-testing the tax credits, meaning lower-income people would get more help.
- Medicaid reform. There are lots of unknowns on what Medicaid reform will look like under a replacement bill. The most recent leaked draft would no longer provide a higher federal match rate for Medicaid expansion populations — but given all the pushback from Republican governors, it's easy to see that particular provision changing.
- Setting up high-risk pools. This would be a program to cover those with especially high-cost conditions, which shows up in numerous Republican health plans. How much funding will go toward these pools is the big question. Different bills floated over the past few years have ranged from $3 billion to $100 billion.
Right now two committees, Energy and Commerce and Ways and Means, with jurisdiction over different parts of the health overhaul are leading the work on a single bill.
These four policies, which are common to lots of Republican plans, including Paul Ryan’s A Better Way, have one important thing in common: Republicans believe they can move forward through reconciliation, meaning they would need only 51 votes in the Senate. The reconciliation process can only be used for changes that affect the federal budget, which means it restricts the type of policies Congress can pass. But it also offers a key advantage: Requiring only 51 votes in the Senate means that this type of bill could pass without any Democratic support.
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- I did a long explainer on the last leaked draft of a Republican replacement plan. Chris Jacobs at the Federalist also has an incredibly helpful section-by-section breakdown.
- Congress expert Sarah Binder explains how the reconciliation process works.
- The last draft of a Republican bill included a controversial provision to cap the tax exclusion for employer-sponsored coverage. The congressional aide I spoke with said this idea was still in the mix — but notably did not include it in the list of policies most likely to show up in the replace bill. Employers have been lobbying hard against that provision, as Modern Healthcare reports, which helps explain why Republicans aren’t thrilled to talk about it — and don’t necessarily see it making the final cut.
