Republican Health Care Reform: An Overview

Once Senator-elect Scott Brown from Massachusetts is sworn into office, Republicans will have an unstoppable filibuster machine in place (assuming they remain united). It takes 60 Senators to shut down a filibuster. With a caucus of 41, Senate GOPs can kill most any bill on the table. (Budget related items can be moved forward through the reconciliation process with only 51 votes).

Which means when it comes to health care reform, Republicans have a choice: they can kill most any bill or they can help pass reform legislation that includes some of their pet provisions. For much of the health are reform debate it was unclear what was the Republican health care reform proposal. There were plenty of ideas thrown around by various groups of GOP lawmakers, but there was no one generally agreed to set of reforms. To be fair, it wasn’t clear what reform provisions were part of the official Democratic recipe either: liberals had their ingredients; moderate Democrats had ideas of their own.

For Democrats it’s fair to say that somewhere between the bill passed by the Senate and the one passed by the House lies their health care reform proposal. Republicans have their own legislation, the “Common Sense Health Care Reform and Affordability Act.”. While this legislation has never been considered by a Congressional committee (that I’m aware of) based on the the Republican response to President Barack Obama’s State of the Union address by Virginia Governor Bob McDonnell, it appears to be the “official” GOP plan. What Governor McConnel said is that “many of (the Republican’s health care reform) proposals are available online at solutions.gop.gov.” As Governor McDonnell was speaking on behalf of the Republican Party, and since the web site he referred to an official Republican Party site, I assume it’s fair to consider the legislation and the web site as the official GOP position on health care reform.

So what kind of health care reforms would Republicans say “yes” to?

  • Require states to operate “qualified” state reinsurance programs and high risk pools to enable individuals with pre-existing conditions to obtain coverage so long as they are “citizens and nationals of the United States.” Aliens legally in the United States would apparently not be eligible.
  • $25 billion would be allocated to the help fund these programs.
  • Premiums could be no higher than 150% of the state’s average individual health insurance premium
  • Eliminating annual and lifetime spending caps on health insurance coverage
  • Preventing carriers from imposing pre-existing conditions on consumers if they maintain continuous coverage.
    • In describing this provision, Republican staff of the Ways & Means Committee describe this provision as extending “existing HIPAA guaranteed availability protections.” Among the extensions is eliminating the requirement that individuals exhaust their COBRA coverage before becoming eligible for insurance under HIPAA.
  • Prohibiting rescissions except in cases of fraud and even then consumers can appeal the decision to an independent appeals panel.
  • Offering states incentives for:
    • reducing “the average per capita premium for health insurance coverage” in the individual and the small group markets.
    • reducing the number of uninsured in the state by specified percentages
  • Permitting states to “contract with a private entity to develop and operate a plan finder website” to provide information on individual coverage available to consumers in that state. These state plan finders are explicitly prohibited from directly enrolling individuals in health insurance plans.
  • Allows small business to come together in Association Health Plans that operate across state lines.
  • Allows individuals to purchase coverage from any health plan licensed in any state. Insurance from a health plan licensed in another state will “still be subject to the consumer protections and fraud and and abuse laws of the policy holder’s state of residence” according to the Ways & Means Committee GOP staff.
    • The rationale for this provision, as stated by those Republican staffers, is that “differences in state regulation of health insurance have resulted in significant variance in health insurance cost from state to state. Americans residing in a state with expensive health insurance plans are locked into those plans and do not currently have an opportunity to choose a lower cost option.”
  • Encourages use of Health Savings Account by allowing them to be used to pay for health insurance premiums, enabling those receiving a nonrefundable tax credit to contribute to an HSA and the like.
  • Capping malpractice awards for noneconomic damages to $250,000 and other medical liability reforms.
  • Eliminates a current comparative effectiveness research initiative aimed at identifying the effectiveness of various medical procedures
  • Providing incentives for prevention and wellness programs
  • These are the primary provisions. There are others aimed at combating fraud and abuse in government health programs, preventing federal dollars to be used for abortions and the like, but these are the core elements related to access and affordability.

    Some of the Republican health care reform bill is relatively non-controversial. Who opposes encouraging prevention and wellness programs? The Republican health care reform proposal’s impact on the uninsured would be minimal, according to the independent Congressional Budget Office. However, the CBO also found that the GOP reform plan would “reduce average private health insurance premiums per enrollee in the United Sates, relative to what they would be under current law- by 7 percent to 10 percent in the small group market, by 5 percent to 8 percent for individually purchased insurance, and by zero to 3 percent in the large group market.”

    My point in describing the Republican health care reform proposal is not to applaud or criticize it (that’ll happen in future posts). Nor is it to imply that this legislation has any chance of being enacted.

    But on the off-chance that both President Obama and the GOP are serious about negotiating over health care reform legislation, it’s useful to know the parameters of the discussion. The Senate bill, with the expected modifications as reported in this blog and elsewhere over the past few weeks, represents the starting point for Democrats. The Common Sense Health Care Reform and Affordability Act represents the starting point for Republicans.

    Let the negotiations begin.