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Aug. 18 2015 3:36 PM
Scott Walker and Marco Rubio Explain How They Would Replace Obamacare, and It Isn’t Pretty
Photo by Scott Olson/Getty Images
In what can only be described as a ill-fated attempt to
focus this summer's primary campaign season on something other than
Donald Trump's noxious opinions about Hispanics and women, both Florida
Sen. Marco Rubio and Wisconsin Gov. Scott Walker have unveiled their
plans for repealing and replacing Obamacare. Rubio laid out his thoughts
in a Politico op-ed Monday night. Walker released a brief policy paper Tuesday, which he elaborated on during a speech delivered, as a few sharp observers noted on Twitter,
before the symbolically inconvenient backdrop of a screw machine
factory. The two proposals have much in common, and together should give
the public a pretty good notion of what to expect from the GOP field on
health care.
Jordan Weissmann
What's the major idea? After scrapping the Affordable Care
Act, both Rubio and Walker would essentially give Americans a little bit
of money so that they can possibly afford to buy cheap insurance. And
by cheap insurance, I mean really crappy insurance. This is the approach
that has been popular among conservative policy thinkers
for a while, and is basically the inverse of Obamacare, which gives
Americans subsidies to buy higher quality coverage. The GOP strategy
consists largely of three main steps:
- Allow Americans to buy coverage across state lines.
- Give people who don't get insurance through their employer a tax credit so that they can purchase a private plan.
- Create special "high-risk pools" for the sick who can't get coverage otherwise.
Now here's how that all works together.
Today, even though Obamacare put in place a new set of
federal standards, health insurers are still basically regulated by the
states, which have different laws about consumer protection and what
conditions companies are required to cover. The result is that Americans
have to buy health plans in the state where they live. Republicans,
like Rubio and Walker, would like to change that system by allowing
consumers to shop around the country, which they argue would create
competition and drive down prices.
In theory, there's nothing wrong with this idea. But it only
works if the federal government sets acceptable guidelines about what
sorts of plans insurers are allowed to sell. Otherwise, it would almost
certainly spur a harmful race to the bottom, in which companies would
flock to states with the loosest regulations, and offer cut-rate
insurance offering little protection. The likely result, as the
Congressional Budget Office argued years ago, is that young, healthy customers would opt for the least expensive options available, while older, sicker Americans would end up paying more
for coverage. Meanwhile, many of those invincible-feeling
twentysomethings would find their health insurance wasn't worth much
once they actually needed it. And the chances are that a Walker or Rubio
administration wouldn't do much to stop that from happening.
Setting those niggling little problems aside, letting
Americans buy health insurance in a lightly regulated national market
would probably lead companies to offer some affordable catastrophic
coverage. That's where we get to Step 2. Both Rubio and Walker would
offer Americans without job-based insurance a tax credit to buy on the
individual market, which would likely be enough to pay for a low-end
plan.
Walker notes that there are some people who, under his
system, might actually get a bigger tax credit than they would now under
Obamacare, which subsidizes coverage purchased on its health care
exchanges. But if the governor really wants to offer even remotely
generous tax credits, it's probably going to be expensive. And that's a
bit of a problem, since he's planning to 86 all of the taxes that
currently pay for the Affordable Care Act.
Of course, tax credits won't do much good for people if they
can't get coverage because they have cancer or a disability. Obamacare,
of course, outright bans insurers from discriminating against people
with pre-existing conditions, then makes it up to the companies by
requiring every American to get insured, which gives them more healthy
(and profitable) customers. Rubio, Walker, and other Republicans would
eliminate those rules. Instead, they would likely try to help the sick
get coverage through other means, likely by subsidizing state-run
"high-risk pools." (Both Rubio and Walker suggest this is only one
option, but it's really the conservative policy of choice.) The idea is that companies can sell special insurance plans designed for the infirm, which the government can help pay for.
This is an idea that has been tried many times before, most
recently as a stopgap measure under Obamacare that was meant to tide
people over until the law went into full effect. The lessons
have been pretty clear: Most of the time, the plans offered in
high-risk pools remain extremely expensive and tend not to enroll many
individuals. You could potentially fix those problems by injecting many
billions of dollars into them. But last I checked, Republicans aren't
typically fans of government spending, and the chances that they would
appropriately fund the pools seem rather small.
Both Rubio and Walker offer up additional ideas, some of
which would be, well, controversial. For instance, Rubio would seemingly
fund his plan partly by cutting back on the tax break for
employer-provided health insurance, which, as Vox's Sarah Kliff writes, would have the obvious effect of making most Americans' insurance more expensive
(it's also probably a nonstarter in Congress). Both he and Walker,
would also give more control over Medicaid to the states, which is
typically code for cutting back on benefits to the poor. Rubio also
explicitly says he would eventually turn Medicare into a program that
helps seniors buy private insurance. Walker, perhaps wisely, doesn't
really touch the subject.
But the big takeaway is that the establishment GOP
contenders are edging toward a consensus alternative to Obamacare, a
three-part plan that would potentially make insurance cheaper for the
young, more expensive for the old and sick, and depending on how
tight-fisted Congress felt, unaffordable for the ill. Thankfully for
them, nobody should notice for a while. Everybody is still paying
attention to Trump, after all.
First of all, Obamacare actually works (in the states that allow it to) to save lives and keep people from going bankrupt and losing everything should a family member need catastrophic care (no matter the cause).
So, the solutions the Republicans offer kills all those people and drives all those people into bankruptcy (and then their beloved relative dies?)
So, how unrealistic can Republicans actually get?
We were the very last to enact serious health care reforms of all major developed countries on earth. Do you know which country has the best health care system from cradle to the grave? South Korea.
The Republicans should be embarrassed.
I am for them for thinking the American people are that stupid.
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