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Republican Alternative To Obamacare: Pay More, Get Less, Put The Insurance Companies Back In Charge

Entertainment Memo Pad Politics

Republican Alternative To Obamacare: Pay More, Get Less, Put The Insurance Companies Back In Charge


Now that Republicans have put out an alternative to the Affordable Care Act, Democrats should emphasize what a repeal would really mean for Americans’ health.

Boy, can Democrats have fun with the new Republican alternative to Obamacare. It puts the health insurance companies back in charge and raises costs for almost all Americans. In particular, it substantially raises costs and threatens to cut coverage for the half of all Americans who get health insurance at work. Seniors, the group that Republicans have scared witless about Obamacare, would lose the real benefits they receive under Obamacare. The proposal from three Republican senators is a golden opportunity for Democrats to contrast the specific benefits of the Affordable Care Act (ACA) with what a repeal-and-replace agenda would really mean for Americans’ lives and health.

When it comes to the politics of health care reform, my first adage is “the solution is the problem.” That is because once you get past vague generalities, like lowering costs and making coverage available, to proposing specifics, people will look to see how the proposals impact them personally. This is why health reform is such a political nightmare. Unlike most public policy issues, the impact is very understandable and real.

With the ACA as the law of the land, in analyzing the Republican proposal we must compare its impact to the law it would repeal. The pre-ACA model of health insurance is irrelevant. Here is how the Republican plan would impact people, compared with the ACA:

People who get health insurance at work – bottom line: pay more for worse coverage.

Almost half of all Americans (48 percent), or 148 million people, obtain health insurance at work. The Republican plan would tax 35 percent of the average cost of health insurance benefits at work. This is a big tax increase on working people and is extraordinarily unpopular, as the Obama campaign used to devastating impact on John McCain. And while people would pay more, they would get less coverage, as the GOP plan would allow insurance companies to once again limit the amount of benefits they will pay out in one year and return to the day when employers could offer bare-bones plans.

While taxing health benefits would apply to all employer-provided coverage, the Republicans would give the 30 percent of people who work for businesses who employ fewer than 100 workers a tax credit. That might balance out the increased taxes for some people. However, doing so would create a huge set of economic distortions, as employers might seek to keep firm size under the 100-employee threshold.

Individuals who buy coverage on their own or who are uninsured – bottom line: insurance companies could again deny coverage for pre-existing conditions and offer bare-bones coverage, while the cost of decent coverage would go up for most people.

This is the group that the ACA is most aimed at helping, including the 5 percent of Americans who buy private health insurance and the 15 percent who are uninsured, totaling 64 million people. The ACA offers income-based subsidies to these people when they earn between 100 percent and 400 percent of the federal poverty level (FPL) and enrolls people under 133 percent of FPL in Medicaid, when states agree.

The Republican plan is toughest, in comparison with the ACA, on the lowest-income people and on the higher-income middle class, compared with Obamacare. But many families in between will do worse too.

The Republican plan would wipe out the expansion of Medicaid to people earning less than 133 percent of FPL, a provision the Supreme Court has made optional. It would cut back on Medicaid, ending the federal government’s offer to pay 90 percent of the cost of expanded coverage and replacing that with the federal government paying what it has paid historically, which is between half and three-quarters of the cost of Medicaid, with poorer states getting a bigger share. Crucially, the funding would only be for pregnant women, children and parents with dependent children who earn under the poverty level, as opposed to the ACA’s funding of all adults up to 133 percent of FPL. That means many fewer people covered and states getting less Medicaid money. Republican governors may not complain, but you can bet hospitals will. Adults without dependent children would not be covered by federal Medicaid, which means millions will stay uninsured or lose coverage they now have, unless states pay for coverage without federal support.



  1. 4sanity4all January 29, 2014

    I am a senior, too young for Medicare, and absolutely delighted with my ACA policy. I cannot imagine anything the Republicans could do to make me want a policy such as the one you are describing. If that is the best they can come up with, then they should leave the ACA alone, and get to work creating jobs or something. I now get to use the local hospital I have always desired to use, can choose from doctors affiliated with that hospital, and I now have excellent basic coverage. The President has fixed it for me. If others are having glitches, fix them, but leave my wonderful new coverage alone, Republicans.

    1. SeekingOut January 30, 2014

      I think it’s important that this message be passed on directly to as many of friends/family, etc. as possible. Spread the good news!

    2. latebloomingrandma January 30, 2014

      Are you in a state that set up its own exchanges?

      1. 4sanity4all January 31, 2014

        I live in Illinois, and because our state is broke, it opted to use the federal exchange. It took me about a month to sign up; I would get a little info onto my account, it would crash, and so on. I would call a navigator, they would help, but their computer would crash. I would call back and go back online, and got it done in small, maddening increments. There at the end, the web site improved every couple of days. Finally, I was able to get a BCBS policy, and I was able to get into a PPO that uses a top local hospital. My policy costs almost $100 more per month than my old worthless plan, and I will actually get healthcare for a co-pay, and not have to bear the entire cost any more. There will still be co-pays, sure, but there are now no conditions that are not covered at all, as with the old worthless policy. I still have a deductible, but some basic checkups and tests are covered without having to meet it. All in all, I will be out a lot less pocket money because my premium will actually cover stuff. I got a prescription yesterday and I paid nothing- my premium had it covered! Woo-hoo!

    3. Robert Roberto January 30, 2014

      Give us the name of your insurance company that’s not an order only a request, so we may be able to check it out, and decide; if it’s right for us. The key word is the deductible and how much we will pay before the insurance company begins paying some of the bills. 100%, 90% or even 80%.

  2. docb January 29, 2014

    Hear Coburn is out lying about losing his doctor…which too obvious…he is medicare qualified and grandfathers in by his senate tenure! This proposal is a farce!..Another repub rape of the people!

  3. Lynda Groom January 29, 2014

    We’ve been waiting for decades for the ‘party of ideas’ to put something forth and this is what we get? It is shame to see the grand old party sink so low and find themselves devoid of useful options.

  4. Dominick Vila January 30, 2014

    There is nothing wrong with criticizing facets of a new program and offering alternatives. Unfortunately, the “solution” offered by the GOP is limited to repeal and a return to the most expensive and exclusive medical system in the world. If the GOP believes that parts of ACA are not as efficient or effective as they should be, they should offer alternatives, and get credit for contributing to a better system. Otherwise, they should keep their mouths shut and let the millions of Americans who have already benefited from ACA, and the millions more who will do the same in months to come, enjoy the preventive medical care and peace of mind that have lived without since they were born or lost their jobs and company benefits.
    Demonizing progress and efforts to improve the welfare of the American people to score political points is disgusting. Hopefully mainstream Americans will wake up and see who is fighting for them and who is flushing them down the drain to achieve their personal and party goals.

  5. ProudACLU January 30, 2014

    I despise the GOPT but even I have to agree with 1 of their ideas. If people had to pay for the true cost of their healthcare, I guarantee a bag of salt water would not cost $800 in a hospital. The flip side of that is the Health care industry is going to only work on treatments that people will be willing to pay for – which means if you have a medical issue beyond Viagra and Ambien, your going to be screwed – and the drug “war” is going to explode when people have to find pills that will alleviate their suffering from outside the established companies.

    1. Independent1 January 30, 2014

      I’m sorry, but I’m missing the point of your comment. Everything you get in a hospital is exponentially more expensive than necessary because there are still millions of people running to the ER without insurance and millions getting into accidents or coming down with terminal illnesses who don’t have insurance, all of whom cannot pay for the often hundreds of thousands of dollars in healthcare they get. And although the government is supposed to cover some of those costs, many hospitals, doctors and labs wait years to get reimbursed for expenses they incur for patients who can’t pay. So to cover all these lost costs, healthcare providers charge exhorbitant prices for everything they provide when someone is in the hospital or getting healthcare elsewhere.
      It is going to take time for all these ridiculous costs to come down now that more and more people are getting covered by insurance – but it’s certainly not going to happen overnight. And the government needs to keep track that as fewer and fewer Americans resort to using the ER as their basic medical care facility of choice that hospitals, doctors, labs etc. do in fact start realistically pricing their healthcare products and services and stop padding them to the extent that they have been. (If you have insurance and have looked at your bills, you’ll notice that most healtcare insurance companies have negotiated down the healthcare costs they will cover to even as low as 1/3 or even 1/4 of the prices that they are being charged.)

  6. charleo1 January 30, 2014

    The good news is, we now have a National Health Plan. And, with the
    reelection of President Obama, we would have seemed to have decided
    healthcare is not simply a commodity, as it had been looked upon previously. But, a human Right. As necessary to insure those basic Rights of life, liberty, and the pursuit of happiness. As is the freedom from hunger, or ignorance, or the freedom from oppression. And that is progress caring people across our Country may be proud. But, it is by no means an advancement that is secure. Republicans will continue their all out assault. Attacking, and degrading the law, as their political power allows. On philosophical grounds, to be sure. But, mostly by asserting
    again, and again, we can’t afford it. And the way it was set up, the only
    way our corporate captured Congress was able to pass a health law,
    it is expensive. But, Republicans are only half right, when they claim it’s
    costs are prohibitive. They may well be, if we are unable to change some
    very intrenched ways we have been doing business in this fully global economy. And to be honest, those changes we must make, are not going to be impossible, but very close to it. And the Republican Right, has no problem with the specter of 100 million, or 150 million Americans, with little or no access to the healthcare system. Much preferable from
    their perspective, than toughening their stance with corporations. The fact is today, that whenever corporations are successful, and some are enormously successful. Too many still wind up as being a cost negative to the Country. McDonald’s for Christ’s sake, cost U.S. taxpayers 7.1 billion dollars last year! Mostly to feed, house, and provide medical care for their employees. Not to mention the number of heart operations paid for on the public’s dime, after Americans have eaten their garbage for 50 years! There are hundreds of such examples. And, who in Congress is willing to take on corporate’ new Citizens United, all for one, one for all, wholesale buy out of a fundraising Congress? We must, I believe, if ACA is to survive the onslaught of red ink produced by the corporate free for all, now going on at the public trough. Yet, raising the minimum wage, for corporations like McDonald’s, or Walmart, would force them to pay more of their own costs of doing business, and cut into profits. So naturally the Right Wing is threatening impeachment, of an imperial, and dictatorial, President, who would dare utter such Marxism! Now try explaining to a Fox watching lemming, otherwise known as the North American, self mutilating, throat cutter, why we can’t compete with tax rates offered to corporations by South Korea, Europe, or Singapore, as long as we continue to foot 90% of the military costs of securing half the world’s population. Or keep losing our manufacturing base, and those jobs the GOP knows full well where they are. But, just keeps on asking President Obama about their whereabouts just the same. I believe just as the Founders of this Nation fought their war for our independence. The unavoidable Civil War, to end slavery. And, the World Wars, aganist Fascism, foreign oppression, and world domination. This, the rise of the world corporation, and it’s threat to our way of life, and ultimately to our very freedoms, is only now just beginning. And will be the challenge of this generation.

  7. dpaano January 30, 2014

    Are they kidding? Only idiots would not see what this actually means…..who’s in the Republican’s pockets…..the insurance companies!!! This is ridiculous!

    1. Independent1 January 30, 2014

      Guess who probably gave the Republicans the outline for an alternative plan!! The GOP isn’t smart enough to come up with it by themselves.

  8. SeekingOut January 30, 2014

    So once again I have to ask – what is the HHS Secretary doing about properly informing the populace about the benefits and advantages viz-a-vis the need to sign up and make use of the benefits available under the ACA. Seems to me that they should be going all out to dispel misinformation, communicate the advantages and ensure that everyone who needs coverage understand how they can obtain same. In so doing they would be able to ensure that people are not affected by irrational and misplaced fears.

    1. Independent1 January 30, 2014

      Your suggestion sounds good but how would you expect the HHS Secretary to do that. I constantly get healthcare related information in the mail, much of it is useless or is some form of a scam. My guess is that sending personal mailers to people would be a waste of time as the vast majority of folks would chuck them as junk mail. And given how clueless the vast majority of Americans are about even major events that happen in America, I’m not sure even broadcasting the info you suggest over the TV or Cable would do much good.
      It’s my sense that unless people are taking an interest in seeking out the information – feeling that they want to comply with the law – I doubt any information medium would be of much help.
      Am I missing something? Do you have a way you think Kathleen Sebelious could effectively desiminate the info you’re thinking should be sent out? And if so, how would she get a list of the people who would actually qualify for Obamcare – those who do not now have insurance and would need the information?

      1. SeekingOut January 30, 2014

        The Health Advisors have to be given a more pro-active remit, so that they reach out and not wait for customers to show up. This could be pursued in tandem with an aggressive PR/Marketing push through public dissemination channels – even if this has to be paid advertising.

        1. Independent1 January 31, 2014

          That would help in the states where they can actually guide uninsureds looking to sign up for Obamacare, but unfortunately, a lot of Red States are not even allowing the Health Advisors to do the jobs that was intended for them to do under the ACA legislation. And this is almost 1/2 the states in the country.

  9. howa4x January 30, 2014

    The problems that republicans have is that the core of the ACA was a republican Idea which democrats added some human concerns to. It is a capitalists alternative to Medicare type health care for all, and relay’s on the private sector to manage the illness care finances within government oversight and rules. The republicans are left with trying to massage the current ACA but giving most of the control back to insurance companies with limited government oversight. We would go back to profit of the insurance companies being the goal of the system, and once protections are removed they will whittle away all of them going back to a pre ACA healthcare world. Basically the republican party sees the health of the profit system as vital to all our interests.
    I think people need to realize we are one of he few countries that make huge profits off of your illness. In fact the way the illness care system is set up it needs a continuing stream of sick people to enter it which is counter intuitive to how a country should treat it’s citizens. We need healthy people to run our business, government, operate heavy machinery or farm equipment, drive our 18 wheelers and manufacture our goods and fight our wars. instead of an illness driven system whose goal is the profit of it’s members we should develop a health care system that prizes human life over short term profits.


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