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Paul Ryan's "Better Way for Health Care" plan

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On June 22, 2016, House Speaker Paul Ryan (R-Wis.) released a white paper called A Better Way for Health Care. While the proposal was not a formal piece of legislation, Ryan said that it represented a "first-time-in-six-years consensus by the Republicans in the House on what we replace Obamacare with." The plan would primarily provide consumers with tax credits to purchase insurance and encourage the use of health savings accounts. The Affordable Care Act, commonly known as Obamacare, would be repealed almost in its entirety.

HIGHLIGHTS
  • The plan would maintain a ban on denying coverage for preexisting conditions, allow dependents to stay on their parent's plan until age 26, and ban insurers from retroactively canceling policies.
  • Federal funding for Medicaid would be capped, and funds would be distributed to states either through block grants or a per-capita allotment, whichever the state chooses.
  • Rep. Bob Goodlatte (R) expressed support for the plan, saying that it would "expand consumer choice and lower costs, provide consumer protection, lead the world in developing cures, and preserve Medicare."
  • Text of plan

    Summary

    House Speaker Paul Ryan's (R-Wis.) A Better Way plan would repeal the Affordable Care Act (ACA) nearly in its entirety. The plan would maintain a ban on denying coverage for preexisting conditions, allow dependents to stay on their parent's plan until age 26, prohibit lifetime limits on coverage, and ban insurers from retroactively canceling policies. These elements were all present in the Affordable Care Act.[1]

    A Better Way also envisions some components similar to those in the ACA:[1]

    • insurance market exchanges, though these would be privately run;
    • a limit on untaxed employer health benefits, though it would adjust for the cost of living;
    • and tax credits to help individuals purchase insurance, though these would be a fixed amount rather than tied to premiums, with individuals in the same age range receiving the same amount; this figure would grow over time.

    The plan emphasizes these as differences from Obamacare. A Better Way would also encourage the use of consumer-directed health plans, which pair high-deductible health plans with medical payment accounts such as health savings accounts or health reimbursement accounts. Under the plan, small businesses, voluntary organizations, and individuals would be allowed to pool together to purchase health coverage; the plan posits that this would give these groups greater negotiating power with insurance companies. Public high-risk pools would be established for individuals with costly conditions to keep them from paying high premiums.

    With the idea of encouraging competition between insurance companies, A Better Way would allow insurance companies to sell health plans across state lines and "make it easier for states to enter into interstate compacts for pooling." Under the plan, Congress would also ask the Government Accountability Office to study the effect on competition that removing the limited anti-trust exemption for insurance companies would have.[1]

    A Better Way would also make changes to Medicaid and Medicare. Federal funding for Medicaid would be capped, and funds would be distributed to states either through block grants or a per-capita allotment, whichever the state chooses. Though states that have already expanded their Medicaid programs under the ACA could keep the expansion, the rate at which the federal government matches state Medicaid funding for the population covered under the expansion would be phased down to the normal rate. States that did not expand their programs would no longer be able to under the plan. The government would also allow more flexibility in how states design their Medicaid programs.[1]

    The Medicare program would be altered by combining Parts A and B, which cover hospitalization and physician and outpatient services, respectively. The requirement that Medicare Advantage plans provide the same basic benefits would be repealed, and the plan would require that the U.S. Health and Human Services Department publish a new website comparing Medicare Advantage plans with traditional fee-for-service Medicare. An exchange would be established where beneficiaries could browse various private plans alongside the traditional fee-for-service program.[1]

    Supporters

    The following individuals expressed support for the Better Way for Health Care plan:

    "This agenda has over 40 ideas for health care reform – ideas to expand consumer choice and lower costs, provide consumer protection, lead the world in developing cures, and preserve Medicare."[2]
    "A better way means that those of us and our party will have to follow through on our commitments and I'm so confident we will."[3]

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    See also

    Footnotes