Dissecting The Patient Choice, Affordability, Responsibility, and Empowerment Act

Last updated on: January 28, 2014 at 7:56 am by Jane the Actuary

Dissecting The Patient Choice, Affordability, Responsibility, and Empowerment Act 2014-01-28T07:56:00-06:00 Jane the Actuary

LOGO Patheos Explore the world's faith through different perspectives on religion and spirituality! Patheos has the views of the prevalent religions and spiritualities of the world.

Is it worth the wait? Is this promised “ObamaCare replacement” any good?

Let’s call this live-blogging of the proposal from Senator Coburn, found, among other places I’m sure, on the weeklystandard.com site.

Ready? Here goes:

Section 101: ObamaCare to be repealed in full.

Sectiono 201: adopt consumer protections. 1) no lifetime limits. 2) Move from a 3:1 old:young premium ratio to a 5:1 ratio as a baseline, but permitting any state to opt out and elect alternate ratios, or none at all. 3) keep the dependent coverage to age 26, but allow any state to opt out. 4) Guaranteed renewability: regardless of health status. Good, good, good, good.

Section 202: pre-exsiting condition protections. Any individual can change health insurance plans, whether in individual, small group, or large employer markets, without medical underwriting, so long as they’ve been continuously enrolled in a health insurance plan with “at least catastrophic coverage” for at least 18 months. In addition, a one-time open enrollment period would provide an enrollment opportunity for all. Not quite right: given the large difference between a plan with a $10,000 deductible and a $100 deductible, it shouldn’t be permitted to switch from one to the other upon getting sick, either.

Section 203: “Empowering Small Business and Individuals with Purchasing Power.” Targeted tax credit for “certain individuals” to buy health care — that is, those working for employers with less than 100 employees, but with no requirement to buy any particular sort of coverage. Credits for individuals with income up to 300% of poverty line — refundable, advanceable, phased out over 200% to 300% of poverty, increasing at CPI + 1%. Three age bands, and different amounts for individuals & family, from $1,560/$3,400 at age 18 – 34 to $3,720 – $8,810 at 50 – 64. This is the most poorly thought-out part. Why only three age bands? These credits need to be based on the age and sex of every family member. And why only employees of small employers? It leaves those working for large employers without health insurance just as stuck as before. (Though the text was confusing on this point — maybe poor editing masked an intention to cover more people.) There’s also no explanation of how credit eligibility and amounts work for married couples.

Section 204: More Tools for States. States can randomly default non-enrolling individuals in to a plan with premiums equal to the value of the tax credit, though individuals can switch or even opt-out altogether. Funding for high-risk pools at the state level. Small businesses can negotiate small business health plans. States can enter interstate compacts for pooling and reduced administrative cost. Fine. Fine. Fine.

Section 204 (the editing was poor; there are two section 204s): Expansion of consumer-directed healthcare. Removal of restrictions on OTC medications, and use of veterans and others of health savings accounts. Allow HSAs to pay premiums for LTC insurance, COBRA premiums, and HSA-qualified policies.

Section 301: Medicaid reforms. Medicaid recipients can also elect to use the tax credit. Fixed amounts to states, allocated based on #s below poverty line, growing at CPI + 1%.

Section 302: reauthorize Health Opportunity Accounts, demonstrating program implementing savings accounts + high deductible plans for Medicaid.

Section 401: Medical malpractice reforms, such as an “Administrative Health Care Tribunal”

Section 501: transparency requirements.

Section 601: Cap the tax exclusion for employee’s health coverage at 65% of an average plan’s costs, growing at CPI + 1%. Repeal employer mandate. I read something earlier indicating that this probably means 65th percentile. Not sure how this plays out over the long term.

The bottom line:

The biggest problem with this proposal is that the tax credits are still very poorly thought out. The one improvement on prior proposals is that at least there are age bands on the credits, but that’s such a small improvement, and other parts of the proposal are still flaky and so undefined as to indicate that there’s not much thought put into the proposal, such as the distinction between large and small employers as far as eligibility.

What next? It’s disappointing. I suppose that’s why there’s so little reporting on this proposal. And this is where I really wish there was some value in the old counsel to “write your Senator.”

UPDATE: The more I think about it, the more appalled I am that this proposal, which was spoken of so favorably at The Weekly Standard and the National Review, is such a bust, and, it seems to me, likely to be just as ignored as every proposal before it.

Uncategorized

Previous Post

January 27, 2014

From the library: The New Artisan Bread in Five Minutes a Day, by Jeff Hertzberg and Zoe Francois

Next Post

January 28, 2014 $50 per stitch

Browse Our Archives

Select a Category Actuarial/Retirement Issues Politics Uncategorized

Select a Month September 2026 August 2026 July 2026 June 2026 April 2026 March 2026 February 2026 January 2026 December 2025 November 2025 October 2025 July 2025 June 2025 May 2025 April 2025 March 2025 February 2025 January 2025 December 2024 November 2024 October 2024 September 2024 August 2024 July 2024 June 2024 May 2024 April 2024 March 2024 February 2024 December 2023 November 2023 October 2023 September 2023 August 2023 July 2023 December 2022 September 2022 August 2022 July 2022 June 2022 May 2022 February 2022 January 2022 December 2021 August 2021 June 2021 April 2021 February 2021 January 2021 December 2020 November 2020 October 2020 September 2020 August 2020 July 2020 June 2020 May 2020 April 2020 March 2020 February 2020 January 2020 December 2019 November 2019 October 2019 September 2019 August 2019 July 2019 June 2019 May 2019 April 2019 March 2019 February 2019 January 2019 December 2018 November 2018 October 2018 September 2018 August 2018 July 2018 June 2018 May 2018 April 2018 March 2018 February 2018 January 2018 December 2017 November 2017 October 2017 September 2017 August 2017 July 2017 June 2017 May 2017 April 2017 March 2017 February 2017 January 2017 December 2016 November 2016 October 2016 September 2016 August 2016 July 2016 June 2016 May 2016 April 2016 March 2016 February 2016 January 2016 December 2015 November 2015 October 2015 September 2015 August 2015 July 2015 June 2015 May 2015 April 2015 March 2015 February 2015 January 2015 December 2014 November 2014 October 2014 September 2014 August 2014 July 2014 June 2014 May 2014 April 2014 March 2014 February 2014 January 2014 December 2013 November 2013 October 2013 September 2013 August 2013 July 2013

TAKE THE

Religious Wisdom Quiz

I am an animal that chews the cud and has split hooves. What am I?

Select your answer to see how you score.

An unclean animal A clean animal A protected animal A sacrifical animal