Paul Ryan's ACA replacement planArticle added by Benefits Pro on December 5, 2016
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BY JACK CRAVER

While the Speaker Paul Ryan's proposal outlines the types of policies the new plan would entail, it lacks critical details about how much they would cost. (Photo: iStock)

Speaker Paul Ryan says he has a blueprint for replacing the Affordable Care Act.

A 37-page document uploaded to the speaker’s website is the closest thing to a detailed Obamacare replacement proposal to come from a leading Republican. The GOP has been saying for years that they have a plan to repeal the ACA, but their plan for what will come after repeal has remained vague.

Related: [NPR] Ryan's plan to change medicare similar to Obamacare

At least one expert who has looked at the proposal says it amounts to “Obamacare light.”

The Ryan plan gets rid of the most unpopular ACA provisions, including the penalties imposed on individuals who don’t buy insurance or businesses that don’t provide coverage to their employees.

The plan would offer tax credits to help people buy individual insurance policies, similar to how the ACA currently operates. It will also bar insurers from denying coverage to customers based on pre-existing health conditions.

The plan would also seek to encourage individuals to establish health savings accounts and to opt for high-deductible health plans. High-deductible plans are already the norm in the ACA marketplace; it is a reality that some ACA critics have cited in arguing that getting rid of the law won’t be such a big deal to the millions who currently have coverage because of it.

The Ryan plan also includes a provision suspiciously similar to the Cadillac Tax, a controversial provision of the ACA that Congress voted last year to suspend until 2018. Ryan’s proposal suggests subjecting health benefits to taxation — although perhaps not treating it quite the same as other income — in the hopes of encouraging employers to compensate workers with wages, rather than expensive health plans.

No individual mandate

While the Ryan proposal outlines the types of policies the new plan would entail, it lacks critical details about how much they would cost. There is no information about how large the tax credits will be.

In addition, Republicans have yet to describe how they expect insurers to accommodate customers with pre-existing conditions in the absence of a law requiring healthy people to get coverage.

Eliminating the individual mandate appears likely exacerbate an existing problem with Obamacare: Not enough young people have enrolled, leaving insurers with predominantly older, sicker customers.

Ryan’s response to the issue of pre-existing conditions is to set up high-risk pools from which people with serious medical conditions can buy subsidized plans. Critics point out, however, that high-risk pools are hardly a new concept, and their track record is far from stellar.

"When you put people into this insurance ghetto, which is these high risk pools, the cost is going to be extraordinarily high," says Sabrina Corlette, a professor at the Georgetown Center for Health Policy Reform, in an interview with NPR.

Multiple experts across the ideological spectrum are warning that the ACA repeal could wreak havoc on American health care if it is not done responsibly.

Michael Leavitt, former secretary of Health and Human Services under President George W. Bush, tells the Los Angeles Times, “There is a real need here not to overreach and not to move too fast.”

Originally published on BenefitsPro.com
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