Senate Republicans Embrace Obamacare In Their Healthcare Bill

Today, the Senate Republican leadership released its draft of a bill that would supposedly repeal and replace Obamacare.

It does neither. With this bill, Senate Republicans are betraying the promises they made on the campaign trail for the better part of seven years. If it passes, the GOP will have cemented the basic architecture of Obamacare into place — wittingly or not.

Two aspects of the bill deserve particular scorn.

First, its proposed tax credits would vary with income and subsidize coverage for people making up to 3.5 times the poverty level, or about $86,000 for a family of four starting in 2020.

This scheme is virtually no different than Obamacare’s, which provided tax credits to people making up to four times the poverty level — about $98,000 for a family of four.

The House’s American Health Care Act offered tax credits that vary by age — a suitable proxy for how much it actually costs to insure someone. That’s a far better approach — one that could actually help control health costs.

Second, the Senate bill preserves Obamacare’s expansion of Medicaid to those making up to 138 percent of the poverty level for at least three more years — and potentially more than that. Starting in 2021, it would pare back federal funding for this group. And in 2025, the bill would ratchet down the growth rate for Medicaid spending to the rate of inflation.

Of course, those cuts may never take effect. Republicans will need to keep the White House in 2020 to ensure that the Medicaid expansion ends. And they’ll need to ensure that they win in 2024 in order to enact their reforms to the program’s growth rate.

Moderate Republicans in both the Senate and in governor’s mansions across the country are already unenthused about any cuts to Medicaid. Delaying these reforms is not that far from doing nothing at all.

Republicans have made “repeal and replace” the centerpiece of their campaign message since Obamacare became law in 2010. Today’s bill indicates that those words were little more than empty rhetoric.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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