Washington — U.S. Sen. Bill Cassidy, R-La., has rounded up some heavyweight co-sponsors for his proposed replacement to the Affordable Care Act, his office said, but the legislation still has a long way to go after Cassidy officially introduced it Tuesday.
Senate Majority Leader Mitch McConnell, R-Ky., and Majority Whip John Cornyn, R-Texas, have signed on to Cassidy’s Patient Freedom Act, as have David Vitter, R-La., and four other Republicans.
Cassidy’s bill could form a significant element of the Republican response to a potential decision by the U.S. Supreme Court in favor of a conservative challenge to the 2010 law. But in a radio interview Monday, McConnell said the details of the response won’t be determined until after the Supreme Court makes its ruling, which is expected by the end of the month.
A ruling in favor of the Obama administration, which has defended the law — called “Obamacare” — against the challenge, would render an immediate Republican response moot. Each side has expressed confidence the court will rule its way, and the outcome is not at all certain.
The challenge, based on a single phrase in the voluminous health law, maintains that it is illegal for the federal government to pay the subsidies that help low- and middle-income residents buy insurance through the federal exchanges that operate in the three dozen states that did not set up their own Affordable Care Act health-insurance exchanges. Louisiana is one of those states without its own exchange.
More than 6 million people nationwide receive subsidies through the federal exchanges, including nearly 200,000 in Louisiana. A Supreme Court ruling for the challenge likely would leave them unable to afford their current health insurance, which could spur anger at Republicans in Congress. The law, considered Democratic President Barack Obama’s signature legislative achievement, passed Congress without a single Republican vote, and Republicans have criticized it relentlessly ever since.
Sen. Ron Johnson, R-Wis., in April introduced a bill — also co-sponsored by McConnell and Cornyn — to extend the subsidies though August 2017 in the event of a court ruling striking them down. The idea is that, with a newly elected Republican president taking office in January 2017, the extension would allow for a transition to a complete replacement of the health law.
Cassidy’s proposal represents a replacement, and he said Tuesday it could work in concert with a subsidy extension like the one in the Johnson bill. Cassidy said he does not want to leave any patients now depending on the subsidies in the lurch if the court cuts off the payments.
Cassidy’s proposal has attracted no Democratic co-sponsors in the Senate, and unified Democratic opposition there would block its passage. Should the measure reach Obama’s desk, he is certain to veto it. In the event of a court ruling that upholds the challenge, Obama has said Congress should vote for a simple fix legalizing the subsidies in all states.
Cassidy, a Baton Rouge gastroenterologist, explained his proposal to a Washington nonprofit group last month, but did not file the legislation until Tuesday. It would do away with the mandates to obtain insurance that are, for Republicans, a particularly repellent part of the ACA. “It’s not an American value to be told what to do by the federal government,” Cassidy said in a news conference Tuesday in the Capitol.
The Cassidy plan essentially would convert the subsidies to grants to individuals and families to spend on health care and insurance — although, unlike the subsidies, the grants would not vary depending on income. The grants would be allocated on a state-by-state basis, with the amount equal to the current subsidies provided for a state’s residents plus the federal contribution to the expansion of Medicaid in that state allowed under the ACA (an expansion that Louisiana and 20 other states under Republican influence have forgone). States would have flexibility in administering the grants, but the money would have to go to patients.
The money could be distributed to patients via health savings accounts, or HSAs, a mechanism that currently exists, with debit cards linked to the accounts. Patients could make additional, pretax contributions on their own to the accounts, which — unlike under current law — could be tapped to pay health-insurance premiums, and not just medical expenses.
Employers also could put money in their workers’ accounts, although employees who receive tax-free health-insurance coverage through their jobs — a substantial majority of those insured nationwide — would not be eligible for the federally financed grants. States that decide to participate would be required to offer a basic, affordable, high-deductible health insurance plan under the program. To broaden health insurance coverage — a goal Cassidy supports — states could automatically enroll people in the plan while allowing them to opt out if they wished. He said Tuesday that could result in a 95 percent enrollment rate.
Gone would be not only the Obamacare mandates on individuals and employers to buy or provide insurance, but also most of the requirements for what the insurance must cover. Insurers would be able to adjust rates based only on age, not medical condition. The plans would be portable and could not be canceled so long as the patient remains continuously insured.
Children could remain on their parents’ plan to age 26 — a feature of Obamacare popular with Republicans. And health care providers would have to make public what they charge for services and procedures purchased with HSA money, so that patients could comparison-shop.
Gov. Bobby Jindal, who is expected to seek the 2016 Republican presidential nomination, has strongly criticized any Republican ideas that, like Cassidy’s, maintain the Obamacare taxes that pay for the subsidies and other features of the health care law. Jindal has called for a full repeal of Obamacare. He would replace it with a plan that would offer tax deductions to reduce the cost of health insurance. The plan also would create a fund, financed by reform of Medicare and Medicaid and changes to medical lawsuit rules, that states could tap to make insurance more affordable and to provide it for those with pre-existing conditions. He rejects what he calls “the liberal shibboleth” of universal coverage.
Democrats in Congress are not developing comprehensive plans to respond to a possible court decision in favor of the ACA challenge. Some Obamacare supporters are skeptical of proposals that lack mandates, or that rely heavily on state decision-making or free-market economics, for fear they would result in fewer people insured.
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