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September 1, 2015

Walker, Rubio Present Plans to Repeal and Replace Obamacare

IPI expert referenced: Merrill Matthews | In The News | Media Hit
  Heartland Institute

With the 2016 presidential election 14 months away, Sen. Marco Rubio (R-FL) and Wisconsin Gov. Scott Walker (R) recently announced their plans for how they would repeal and replace Obamacare, joining Louisiana Gov. Bobby Jindal (R) as the only candidates in a crowded Republican field to provide specific policy proposals for replacing the Affordable Care Act.

In August, Rubio and Walker released their plans, which they say will return free-market principles to the health care industry by placing decision-making and spending powers in the hands of patients and their doctors.

Both plans propose to offer refundable tax credits to purchase health insurance, would allow consumers to purchase insurance across state lines, and would expand health savings accounts (HSA).

Rubio says he wants to create a refundable tax credit that would allow consumers to purchase insurance on the individual market, and he wants to reduce the employer-based tax exclusion gradually over a period of 10 years, until its value is equal to that of the tax credit.

Walker’s plan also proposes significant federal tax credits that would help people pay for insurance policies on the private market if they don’t have employer-provided health insurance.

Plans Follow Market Principles

Peter Ferrara, a senior fellow for The Heartland Institute, says what he likes most about the two plans is they would provide freedom and choice for working people.

“They get rid of the individual mandate and the employer mandate, under which the government tells people what insurance they have to buy, and they let people choose the health insurance they want in the marketplace,” Ferrara said. “Plus, the plans both help the uninsured with a universal health insurance tax credit that working people can use to buy whatever [plans] they prefer in the free market.

“The plans also make health insurance a lot less expensive by getting rid of unnecessary Obamacare overregulation, including the mandates, and [they allow] health insurance to be sold across state lines, increasing competition,” Ferrara said. “Of course, I also like that both plans get rid of the Obamacare taxes.”

Merrill Matthews, a resident scholar with the Institute for Policy Innovation, says Walker’s plan is a little more detailed than Rubio’s and focuses on people without employer-based plans.

“Rubio wants to give everyone a tax credit, which is similar to what John McCain’s plan would have done, and it’s the right thing to do,” Matthews said. “However, it’s very difficult to explain to the public.

“Rubio’s plan also talks about expanding Medicare, but his problem is, how do you expand Medicare and pay for it?” Matthews said.

Defects in the Candidates’ Plans

Twila Brase, president and cofounder of the Citizens’ Council for Health Freedom, says she likes that both candidates want to repeal Obamacare, but any replacement bill will have problems.

“A straight repeal of the law is relatively easy compared to the huge target that replacement presents,” Brase said. “The only reason Obamacare passed is because there was one party in power with a presidential champion, to the point that the party in power didn’t even read the bill, but a replacement plan would be carefully read, special interests would weigh in on every word, and in a divided Congress, the repeal might never happen because of disagreements among members of both parties and their donors.”

Matthews says it will take a lot of political courage to follow through on a campaign promise to repeal and replace Obamacare.

“It’s one thing to say it on the campaign trail and another to actually do it, especially if they have to make a decision that will take away the Obamacare subsidies [currently given to] roughly seven million people and receive a lashing from the media and Democrats,” Matthews said.

Brase says Rubio’s plan would retain too much government control over health care.

“Rubio wants to strengthen Medicare and Medicaid,” said Brase. “However, if we want health freedom in our future, keeping Medicare in play will be an obstacle.

“Medicare and its 132,000 pages of regulations controls much of what happens in every exam room and at every beside,” Brase said. “I envision a Medicare-free society where we keep private health insurance or health sharing for a lifetime and charity retakes its vaunted place as part of the mission of medicine.”

Proposing Block Grants

Medicaid is addressed in both candidates’ plans, Brase says.

“Walker has three block grants to states, which is interesting, and Rubio also has a per-capita block grant,” Brase said. “That’s a start, but the goal should be to get the federal government out of health care, to reduce federal taxes and controls as a result, and to open up real and competitive markets for health insurance, not just a cabal of federally endorsed or state-endorsed managed care corporations for all.”

John C. Goodman, a senior fellow at the Independent Institute and president of the Goodman Institute for Public Policy, says the biggest defect of the Walker plan is it’s not really paid for.

“[Walker] abolishes Obamacare, which abolishes the revenues for Obamacare, then he wants to have a tax credit for people to buy their own insurance, but he has no way of paying for that,” Goodman said.

Kenneth Artz (iamkenartz@hotmail.com) is managing editor of Health Care News.


 

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