House Republicans Present Outline of Plan That Would Gut Health Coverage

WASHINGTON, Feb. 21 -- The Center for Medicare Advocacy issued the following news release:

Last week, House Republicans presented an outline of a plan to "replace" the Affordable Care Act (ACA) and cut Medicaid payments to states. While this proposal is lacking detail, does not articulate its cost and provides no estimate of how many people will lose their health insurance coverage, the proposal clearly represents a major step backwards for our nation's health insurance coverage.

The proposal to repeal and replace ACA, entitled "Obamacare Repeal and Replace: Policy Brief and Resources," would eliminate the individual mandate to obtain health coverage, the insurance industry's duty to guarantee issue, premium subsidies for lower-income people, and the Exchanges for purchasing plans on the individual market.

Instead, the plan would create Health Savings Accounts (HSAs) as the principal health care financing vehicle, coupled with high-deductible health plans - which shift higher costs to enrollees. People with pre-existing conditions would be moved to state financed "High-Risk Pools," which have proven to be inadequate and expensive in the past. The ACA's premium tax subsidies would be replaced with a Universal Health Care Tax Credit (UHTC) which would vary by age, not income, as under ACA.

In addition, and perhaps most dangerous, the proposal includes significant changes to Medicaid. It would cap federal Medicaid payments to each state for Medicaid to a limited, preset amount per person (often referred to as a "Per Capita Cap"). In sum: This would result in dramatic cuts, with inevitable cost-shifting to states, resulting in cuts to services, eligibility and provider payments, and to fewer people obtaining Medicaid and/or quality services.

This replacement proposal does not create a system for providing quality coverage for all. Instead, along with repeal of the Affordable Care Act, it represents a retrenchment from ACA's successes in insuring the uninsurable. This plan does not replace ACA, it's a regression to a less secure, pre-ACA world.

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