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Republicans have proposed many solutions to control health care costs and improve quality, Ron Johnson says
As Republicans continue to score points bashing the early struggles of President Barack Obama’s health care reform law, the common refrain from Democrats is to claim their GOP counterparts lack an alternative. It has fit neatly into their characterization of Republicans as the party of "no."
For their part, Republicans have consistently said that’s not the case.
"Throughout the health care debate, Republicans have proposed dozens of solutions designed to help control costs and improve quality — without surrendering control of your personal health care decisions to nameless bureaucrats in Washington," said Sen. Ron Johnson, R-Wis., during the Republican national address Nov. 17.
The question of how Republicans would replace Obamacare has come up before, and it will remain a major part of the argument over the law’s future throughout the 2014 midterms. There’s a big difference between no solutions, as Democrats surmise, and dozens, as Johnson claims. So who is right? We decided to investigate.
How we got here
We asked Johnson’s office to provide evidence of the "dozens of solutions" Republicans have put forth. His staff sent us a list of 24 Republican proposals released over the years, starting with President George W. Bush’s call for health reforms in 2007.
At this point, let’s pause for some important political and parliamentary realities.
In 2009 and 2010 when the health care law worked its way through Congress and onto Obama's desk, Republicans were in the minority in both the Senate and House. During the initial debate, Republicans circulated many ideas and put forth many bills. None of them gained enough support within the GOP to become a clear conservative alternative to Obamacare, and even if they had, it was unlikely Democrats would go along.
Republicans had even less interest in capitulating with Democrats and working with them on the Affordable Care Act. Not a single Republican voted for the final version Obama signed into law.
We reviewed the list of legislation Johnson’s office sent us. With a handful of exceptions, the bills are partial or full retreads of each other and share similar ideas. Some actually include provisions of Obamacare, such as allowing young people to stay on their parents’ plans or making it harder for insurance companies to drop people with pre-existing conditions.
Johnson’s camp said the Republican senator doesn’t necessarily support all the proposals, but they show that Republicans have been active players in the debate.
We reviewed Johnson’s list of 24 proposals. We found the ideas in them tend to fall along the following six lines:
A bevy of proposals provide tax breaks or credits to incentivize the uninsured to purchase coverage on the individual market and make it cheaper for those already with coverage.
One put up by the Republican Study Committee with more than 100 cosponsors would give a $7,500 deduction to individuals and $20,000 to families. To pay for the deductions, that bill would also eliminate a long-standing tax break on employer-provided insurance. So while some new faces would get insurance on the individual market, the out-of-pocket expenses would likely go up for many Americans, especially those who get good coverage through work.
Another bill from Rep. Tom Price, R-Ga., gives a tax credit of $5,000 to families at or below 200 percent of the federal poverty level, about $47,000.
Both proposals aim to improve the affordability of insurance for low-income individuals, and while it could shift the cost curve down for some people, it would not dramatically transform the cost of care.
Allow insurance companies to sell policies across state lines
Right now, insurance companies may not sell a policy in multiple states. Republicans want to open up the borders, saying it would increase competition and allow market forces to push down prices. Opponents caution that insurance companies will flock to states with the loosest regulations and sell policies from there.
The nonpartisan Congressional Budget Office predicted savings of about $12 billion from 2007-15, but most experts did not believe it would dramatically impact the cost of insurance or entice more people to sign up. The CBO predicts it would mean cheaper premiums for healthier individuals and more costly insurance for those who have health issues and are already paying a lot. That’s the opposite goal of health care reform.
Tort reform would change statutes regarding medical malpractice lawsuits, which Republicans say lead to frivolous claims and legal costs. It saves money, but it’s nothing to write home about. In 2010, the CBO said modest reforms, such as capping noneconomic damages at $250,000 and punitive damages at $500,000, would save $54 billion in federal spending over the next 10 years. Such a move would also reduce medical liability insurance and eliminate some threat of lawsuits that push doctors to prescribe unnecessary medical tests, decreasing overall health care costs by 0.5 percent.
Health savings accounts
Health savings accounts allow individuals to set aside money from each paycheck, before taxes, for future medical care. Republicans hope health savings accounts encourage individuals to be frugal and conscientious spenders on their health care, which would drive down the overall costs. But an expansion would cost the federal government $4.7 billion in lost revenue.
Creation of high-risk pools
Republican plans have called for about $25 billion to support states that create high-risk pools for sicker patients who have a hard time getting coverage on the individual markets. We’ve talked to experts in the past who have said that’s probably not enough to make it a viable option for the states or the consumers, since the insurance would have to be heavily subsidized to make it cost-effective.
Allow trade associations and small business to purchase insurance as a group
Since at least 2000, Republicans have pushed for something called Association Health Plans, which allow some small businesses to pool together and buy insurance as a group. However, this would impact a small portion of the population and just 600,000 of the 47 million uninsured people would gain coverage, according to the CBO. A larger pool would lower rates for small business employees already purchasing coverage and healthy individuals. But it would also mean higher premiums for most other insured individuals "because a disproportionate share of enrollees with lower-than-expected health care costs would leave the regulated market to obtain insurance through an AHP, thereby increasing the average expected health care costs of those remaining in the regulated market," the CBO said.
While some of these proposals could shift the cost curve down, nothing we came across would directly impact quality of care, as Johnson claimed. We ran the list by a panel of experts as well, and many of them agreed.
"Johnson may be exaggerating a bit numerically, but the more important point is that the Republican plans would do next to nothing to improve quality, extend coverage, or control spending growth," said Henry Aaron, a health policy expert at the Brookings Institute.
William Dow, a professor of health care economics and head of the University of California Berkeley Division of Health Policy and Management, largely agreed. "There is little here that would improve quality," he said. "Some could have minor effects on controlling costs."
Johnson said, "Republicans have proposed dozens of solutions designed to help control costs and improve quality" of health care in the United States. Republicans have circulated quite a few bills and ideas over the years, but there is almost nothing in most of the GOP proposals that directly addresses quality of care.
As far as costs, most of the proposals have winners and losers. Some of the bills would make health care more affordable for certain individuals, and tort reform and the expansion of health savings accounts could bend the cost curve down slightly. Elements of Johnson’s claim are at least partially accurate, but in the aggregate, the plans are far from substantial. We rate his statement Half True.
Sen. Ron Johnson, Weekly Republican Address, Nov. 17, 2013
Email interview with Patrick McIlheran, policy adviser for Sen. Ron Johnson, Nov. 18-25
Robert Wood Johnson Foundation, Consumer-directed health plans: Do they deliver?, October 2012
Health Affairs, Growth Of Consumer-Directed Health Plans To One-Half Of All Employer-Sponsored Insurance Could Save $57 Billion Annually, May 2012
Upjohn Institute for Employment Research, Refundable tax credits for health insurance, July 2005
American Enterprise Institute, The impact of recent Republican health reform proposals, Sep. 20, 2007
State Health Access Data Assistance Center, State high-risk pools: An overview, July 2008
Rand Corporation, Analysis of refundable tax credit, March 28, 2011
Congressional Budget Office, Analysis of the effect of proposals to limit costs related to medical malpractice, Oct. 9, 2009
Tax Policy Center, Tax Credits for Health Insurance, June 2005
Congressional Budget Office, Selected CBO publications related to health care legislation - 2009-2010, December 2010
Congressional Budget Office, "An Analysis of the President’s Budgetary Proposals for Fiscal Year 2008," March 2007
Congressional Budget Office, Analysis of Health Care Choice Act of 2005, Sept. 12, 2005
Congressional Budget Office, Analysis of Health Savings Account Improvements Act of 2012, May 31, 2012
Congressional Budget Office, "Incrasing Small-Firm Health Insurance Coverage Through Association Health Plans and Healthmarts," January 2000
PolitiFact, "GOP health care reform: A simple explanation, updated," Feb. 26, 2010
Politifact, "Hoyer claims Republicans have no health care alternative," Sept. 28, 2009
Email interview with Stephen Bell, communications director, Republican Study Committee, Nov. 25, 2013
Email interview with Ryan Murphy, communications director, Rep. Tom Price, Nov. 25, 2013
Email interview with Tevi Troy, senior fellow, Hudson Institute, Nov 21, 2013
Email interview with Henry Aaron, economist, Brookings Institution, Nov 21, 2013
Email interview with Thomas Buchmueller, economist, University of Michigan, Nov 21, 2013
Email interview with Roger Feldman, economist, University of Minnesota, Nov 22, 2013
Email interview with William Dow, economist, University of California - Berkeley, Nov 22, 2013
Email interview with Donna Brazile, vice chair, Democratic National Committee, Nov 21, 2013
Email interview with Bryant Renaud, senior research assistant, Brookings Institution, , Nov 25, 2013
Republican Study Committee, American Health Care Reform Act, Sep. 18, 2013
Empowering Patients First Act, June 6, 2013
Access to Insurance for All Americans Act, Feb. 15, 2013
Family and Retirement Health Investment Act of 2013, May 23, 2013
Common Sense Health Reform Americans Actually Want, Sep. 20, 2013
Helping Sick Americans Now Act, April 15, 2013
Health Care Price Transparency Promotion Act, March 22, 2013
Offering Patients True Individualized Options Now Act of 2013, Aug. 1, 2013
Health Care Choice Act, April 23, 2013
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Republicans have proposed many solutions to control health care costs and improve quality, Ron Johnson says
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