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Health overhaul revisited: The impact of some GOP ideas

Posted January 4

Vice President-elect Mike Pence, left, is welcomed before a news conference on Capitol Hill in Washington, Wednesday, Jan. 4, 2017, by, from second from left, House Speaker Paul Ryan of Wis., House Majority Leader Kevin McCarthy of Calif., and House Majority Whip Steve Scalise of La. following a closed-door meeting with the GOP caucus. (AP Photo/J. Scott Applewhite)

— Republicans are far from consensus on how they would replace President Barack Obama's health care law, which reduced the nation's uninsured rate to a historic low around 9 percent but failed to win broad public support.

Dozens of GOP-inspired ideas are being bandied about on Capitol Hill, and it could take months or years to fully understand the costs and benefits of complex changes lawmakers are considering.

A GOP replacement may cover fewer people than the 2010 Affordable Care Act, or ACA. But Republicans are betting that their goal of "universal access" with fewer requirements will be more politically acceptable than the Democratic ideal of "universal coverage," with Washington in charge.

A look at the potential impact of some of the ideas put forth by Republicans:

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REPEAL THE INDIVIDUAL REQUIREMENT TO CARRY INSURANCE OR RISK FINES

The so-called "individual mandate" is highly unpopular. Many of the uninsured who end up paying fines to the IRS are low-to-moderate income workers juggling rent, car payments or student loans. Experts debate how well the ACA's mandate has worked in practice.

Insurers see the coverage requirement as a pillar of a revamped market in which they are required to accept people with pre-existing health problems. How else, insurers ask, can they get enough healthy people in the coverage pool to balance risks?

Republicans have several ideas, including a one-time open enrollment period for everyone who remains uninsured, and a requirement that people maintain "continuous coverage" in order to be guaranteed insurance on the same terms as everyone else. Those nudges stop short of a federal mandate.

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HIGH-RISK POOLS FOR PEOPLE WHO CANNOT AFFORD OR GET PRIVATE INSURANCE

High-risk pools for some of the sickest patients could help lower premiums for average-risk customers in the broader individual market.

However, they not worked well previously. The coverage has been expensive and programs often had to limit enrollment. Republicans are proposing at least $25 billion in federal funding.

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TAX CREDITS KEYED TO AGE, NOT INCOME

The ACA's tax credits now are based on household income, with solid middle-class and upper-income people getting little or nothing. One approach Republicans are considering would base tax credits on age. People who don't currently get any assistance because of their income would be eligible.

There are no details on how the tax credits would work, including the amount of assistance provided. House Speaker Paul Ryan's "Better Way" plan says it would be enough to buy "the typical pre-Obamacare" plan. Independent experts say that could be pretty skimpy. A big concern is whether low-income people could afford coverage.

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BLOCK GRANTS FOR MEDICAID

Capping the federal contribution to the federal-state health insurance program for low-income people in some fashion would limit the future growth of Medicaid. States would have more leeway to design their own approaches to caring for vulnerable people.

The impact could be major for the 70 million people now covered by Medicaid, including some 10 million added through the ACA's expansion of the program. Because state programs can vary dramatically, federal limits risk locking in disparities among states. In a budget crunch, states might cull hundreds of thousands of people from the Medicaid rolls, meaning hospitals would get stuck with the bill for emergency care.

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FEDERAL LIMITS ON MALPRACTICE AWARDS

The nonpartisan Congressional Budget Office has concluded that limiting malpractice awards would modestly reduce health care spending by major government programs. But limits could add to the hardship suffered by patients most grievously harmed by negligent doctors and hospitals.

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ALLOWING INSURERS TO SELL INDIVIDUAL POLICIES ACROSS STATE LINES

Interstate competition would help keep premiums in check. But health insurance is a local and regional service, and out-of-state insurers aren't likely to have networks of hospitals and doctors beyond their territory. Many state regulators fear an end run against consumer protections.

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LIMITING TAX BREAKS FOR EMPLOYER-PROVIDED HEALTH INSURANCE

Limiting federal tax breaks for the most generous employer plans would act as a brake on health care spending, while also raising revenue for tax credits to help people buy insurance. This perennial idea has been a political loser. Unions are strongly opposed.

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