Obamacare Replacement Plan Primer

Republicans have proposed many plans to repeal and replace Obamacare. Here is a primer explaining the most important aspects of each plan.

Speaker Ryan’s plan:

  • Eliminates the individual mandate to obtain health insurance
  • Eliminates subsidies for individuals for health insurance
  • Eliminates Medicaid expansion by 2020
  • Grants individuals a tax credit between $2,000-$4,000, with higher allotments for older Americans
  • Doles out $10 billion per year to states for “innovation grants” that would create high-risk pools for people with pre-existing conditions
  • Caps Medicaid spending per person
  • Imposes a tax on employer-sponsored health care plans above the 9oth percentile

Read Paul Ryan’s leaked draft bill here.

Senator Rand Paul’s Plan: The Obamacare Replacement Act

  • Eliminates the individual and employer mandate
  • Authorizes a tax credit up to $5,000 for individuals and families that contribute to Health Savings Accounts to further incentivize health savings
  • Removes the maximum allowable annual contribution limit to HSAs, so that individuals may make unlimited contributions to an HSA
  • Allows the use of HSA funds to pay for insurance premiums
  • Expands Association Health Plans (AHPs) to allow small business owners and individuals to band together across state lines through their membership in a trade or professional association to purchase health coverage for their families and employees at a lower cost; in addition, the bill allows individuals to pool together through any organization to purchase insurance
  • Allows the purchase of insurance across state lines

Senators Cassidy and Collins’ Plan: The Patient Freedom Act

  • Repeals the individual and employer mandate for health insurance
  • Keeps protections for pre-existing conditions
  • Allows young adults to stay on their parents’ health plan until age 26
  • States to have three options:
    • Retain the Affordable Care Act, allowing individuals and small business able to purchase insurance on state exchanges and low-income residents can receive federal subsidies to cover the cost of the program. States that expanded Medicaid, can continue to provide increased Medicaid coverage
    • States can receive most of the federal funding, including federal funding, Medicaid expansion, and subsidies to create tax-free Health Savings Accounts for low-income citizens. Low-income residents can use the HSAs to purchase insurance and pay for health care
    • Allow states to create an alternative solution without federal assistance. States would retain the power to design and regulate insurance markets without federal intervention


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