Win­ners, losers com­pli­cat­ing GOP’s path

The Denver Post - - NEWS - By Ri­cardo Alonso-Zaldivar

WASHINGTON» Repub­li­cans’ lat­est health care plan would cre­ate win­ners and losers among Amer­i­cans up and down the in­come lad­der and across age groups.

As Se­nate Ma­jor­ity Leader Mitch McCon­nell, R-Ky., steers to­ward de­bate and votes next week, here is a look at some of the lat­est changes and ma­jor is­sues:

• Cruz’s plan: The new Se­nate bill in­cor­po­rates a pro­posal from Sen. Ted Cruz, R-Texas, that would re­or­ga­nize the mar­ket for poli­cies pur­chased by in­di­vid­u­als. As many as 20 mil­lion Amer­i­cans get cov­er­age this way, about half through sub­si­dized mar­kets like Health­Care.gov, cre­ated un­der for­mer Pres­i­dent Barack Obama.

Cruz would change ba­sic re­quire­ments that Obama’s law im­posed on in­di­vid­ual plans, in­clud­ing stan­dard ben­e­fits such as preg­nancy, ma­ter­nity and new­born care; well­ness vis­its and men­tal health treat­ment.

Un­der the Cruz ap­proach, an in­surer can of­fer plans that don’t com­ply with such re­quire­ments, pro­vided they also of­fer cov­er­age that does. The prob­lem, say crit­ics, is that the healthy would flock to low-premium, skimpy plans, leav­ing the sick to face es­ca­lat­ing prices for com­pre­hen­sive cov­er­age.

The lat­est bill in­cludes an­other $70 bil­lion to help states keep health in­sur­ance af­ford­able for older, sicker cus­tomers.

Some in­sur­ers are wor­ried be­cause health plans that en­roll health­ier cus­tomers would no longer have to cross-sub­si­dize those with sicker pa­tients, as is cur­rently re­quired. • Em­ployer es­cape hatch? McCon­nell’s new bill made a ma­jor change to tax-shel­tered health sav­ings ac­counts, which was also ad­vo­cated by Cruz.

Un­der the bill, health sav­ings ac­counts could be used to pay pre­mi­ums with pre­tax money. Un­der cur­rent law, they can only be used to cover out-of-pocket costs, such as de­ductibles and co­pay­ments.

The change is meant to level the play­ing field for peo­ple buy­ing in­di­vid­ual plans, as com­pared to peo­ple get­ting em­ployer cov­er­age. The value of work­place in­sur­ance is tax-free for em­ploy­ees and tax-de­ductible for em­ploy­ers.

But some an­a­lysts say McCon­nell risks un­der­min­ing work­place cov­er­age.

The up­side is that the change might en­cour­age more self-em­ployed peo­ple to buy in­di­vid­ual health in­sur­ance poli­cies. The down­side is that some em­ploy­ers may see it as an in­vi­ta­tion to drop health ben­e­fits, par­tic­u­larly since the GOP also would re­peal Obama’s re­quire­ment that larger com­pa­nies pro­vide health care or face fines. • The poor and the sick: McCon­nell kept some Obama-era tax in­creases used by Democrats to fi­nance ex­panded cov­er­age. But the money will shore up pri­vate in­sur­ance, not the Med­i­caid pro­gram. Med­i­caid ac­counts for half or more of the 20 mil­lion Amer­i­cans gain­ing cov­er­age as a re­sult of the Af­ford­able Care Act.

Med­i­caid cov­ers low-in­come peo­ple, from preg­nant women and new­borns, to dis­abled peo­ple and el­derly nurs­ing home res­i­dents. The GOP bill would start by phas­ing out en­hanced fed­eral fi­nanc­ing for Obama’s Med­i­caid ex­pan­sion, adopted by 31 states. It would limit fu­ture fed­eral fund­ing for the over­all pro­gram. It’s es­ti­mated Med­i­caid would cover 15 mil­lion fewer peo­ple by 2026.

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