My Fiscally Conservative Republican Healthcare Proposal
First, I leave the ACA taxes alone other than perhaps getting rid of the dumb and extremely marginal (from a revenue standpoint) things like the devices tax and the Cadillac healthcare tax. Frankly I think it’s fair that the wealthiest among us pay for the healthcare of the least fortunate among us and so neither the tax, nor the system it funds (Medicaid) bug me. I ignore the special pleading from the wannabe aristocrats that their income would better serve us all working as investment capital. As an American, I want to take care of Americans not provide unlimited fuel to globalism. I’m not a fan of taking the taxes on income higher than they already are though, so I also ignore the special pleading from the left that we should just go to a single-payer National Healthcare system either by trying to extract even more wealth from the wealthy. The left may not like it, but that wealth is the source of capital investment and we need it to keep our economy growing.
Second, I remove all the insurance law in the ACA. No more individual mandate, no more regulation of plans, no more requirement that employers above a certain size provide insurance, none of it. I rip out that entire system of regulation en toto. Tearing out by root & branch as much regulation, bureaucracy and oversight as possible.
Third, I end the deductibility of insurance as a business expense. This terrible distortion is one of the roots of all the problems we have with healthcare and it is time for it to go. The provision of healthcare as a benefit of employment is awful. The sunset of this deduction happens two tax years following the passage of the law, and starting 1 tax year before the sunset, employers are required to provide a statement to their employees quarterly noting the expense carried on the books of the firm for the provision of that employee’s insurance. This will make visible the compensation being indirectly paid out for insurance and should serve as the basis for new compensation negotiations between employers and employees as the sunset takes effect.
Fourth, I open the Medicaid system to any person who wishes to enroll in it (while keeping the current eligibility in place). The cost is the average per capita cost for a full coverage non-disabled, non-senior enrollee in your state of residence. For the United States average, that is $3,955/year, or $329/mo, per adult ($2,602/year, or $216/mo for a child). Premiums will be subtracted from wages using a system similar to how child support garnishments are handled now (which is a proven, lightweight system already integrated into payroll systems and procedures requiring little or no additional overhead to manage).
(Curious to what your state’s costs are per capita for Medicaid? Here’s a handy chart: http://www.kff.org/…/medicaid-spending-per-full-benefit-e…/…)
If you require emergency medical treatment and you have no insurance, you will be automatically enrolled in Medicaid, and premiums will begin to be deducted from your pay starting with your next pay period. If the premium would exceed 20% of your net takehome pay the balance will be waived. For the average American (for the purpose of per-capita Medicaid) paid every two weeks that threshold would be $152 (or 20% of net $760, or an annual net income of $19,760. This is going to work out to be something like $10/hour).
(Don’t work or work part-time? Medicaid is for a child? The premium(s) get deducted pro-rata from all members of the household earning income.)
Opt-in Medicaid enrollees do not generate offsetting Federal funds. Their cost is paid for by State funds.
(Note that the current Medicaid enrollee level for states that have expanded Medicaid is 138% of the Federal poverty level in that state. This is approximately $16k/year for a single person, $33k/year for a family of 4).
If automatically enrolled in “opt-in” Medicaid due to the provision of emergency health services, you must remain in the system for a minimum of 3 years even if you would otherwise become eligible for other forms of insurance, except Medicare, in which case your coverage will switch to Medicare. If you voluntarily opted-in to Medicaid (i.e. you had completed the Medicaid enrollment process before you required emergency medical care) you can exit the program after 1 year if you wish.
Medicaid has no pre-existing condition limitation, no income limitation, and no age limitation.
That’s my plan. People in the US are covered by Medicaid, Medicare, VA benefits, private insurance or they risk mandatory Medicaid. Everyone is covered at minimum by Medicaid when they require emergency medical services. The only uninsured are people too young for Medicare, who make too much money to be eligible for free Medicaid, who don’t have VA benefits and who choose not to buy private insurance and take the risk that they’ll end up in mandatory Medicaid due to an emergency.
Insurers are free to offer any policy they wish, at any price they find feasible. There will always be an “insurer of last resort” in Medicaid for people who find the private insurance options unpalatable.