Three GOP senators have put forward the most credible plan to date for an alternative to Obamacare, and the blogosphere is buzzing with debate about the extent to which it differs from the ACA. Wonkblog has a good summary of the main planks:
The biggest, most significant difference between Obamacare and the replacement plan is about financing — how you pay for all those insurance subsidies. The replacement plan repeals a whole slew of industry taxes that had the insurance companies, hospitals and medical device makers all helping to foot the bill. Those are gone. In their place is a limit on the the tax exclusion for employer-sponsored insurance.Right now, the federal government does not tax health insurance when it is provided to an employee by an employer. The Republican plan would limit the tax exclusion to 65 percent of the average health insurance plan. Any amount of a premium beyond that amount would need to be paid with post-tax dollars. There’s no estimate on how many people this would effect and how much more they would pay for premiums, but Republican Senate aides do say it’s true that people who receive more robust policies from their employers would pay more for premiums.
Over at NRO, Yuval Levin, who has been influential in pushing the GOP to offer better health care policy, highlights the fact that states would be able to automatically enroll people in basic plans for the exact cost of the federal subsidy. As Levin makes clear, there are promising ideas in this proposal, though it would be sure to cause disruptions. We’re just glad to see the GOP really get into the health policy game, because the nation benefits when both parties have concrete programs to advance and debate.But overall, those fixated on the policy details of employer-sponsored insurance or ACA exchanges are neglecting the big-picture problems. Tinkering with who pays and through which mechanisms might help make the system more efficient at the margin, but the structural deficiencies with U.S. health care go far beyond the problems the GOP proposal is trying to solve. The way medical education works; the way people access health services; and the incentives for over-treatment, to name just a few, will continue to drive up costs unless we address them in a radically new way.How we pay for health care is ultimately secondary to whether we are delivering efficiently. Even if we just take a few recent examples, story after story has highlighted the systemic problems with how hospitals price care. Even as the two parties debate subsidy levels, this is the larger challenge to focus on.