Rand Paul Unveils Obamacare Replacement Act
On January 24, Senator Rand Paul, MD (R-KY) introduced S. 222, the “Obamacare Replacement Act,” which his press release described as “a health care plan grounded in broadly supported conservative reforms that is ready for an immediate vote after Obamacare is repealed.” The bill, a comprehensive replacement plan for the Affordable Care Act (ACA, i.e., Obamacare), would repeal the individual and employer mandates and other ACA provisions, and provide a 2-year open-enrollment period under which individuals with pre-existing conditions could obtain coverage. Among its provisions, the bill would provide an income and payroll tax deduction for health insurance costs. The bill would also remove the maximum contribution limit for a Health Savings Account (HSA) and provide individuals the option of a tax credit of up to $5,000 per taxpayer for contributions to a HSA; if an individual chooses not to accept the tax credit or contributes in excess of $5,000, those contributions would still be tax-preferred.
Senator Paul’s issued the following Press Release:
Yesterday, U.S. Senator and physician Rand Paul introduced S. 222, the Obamacare Replacement Act, to provide Congress with a health care plan grounded in broadly supported conservative reforms that is ready for an immediate vote after Obamacare is repealed. Dr. Paul’s proposal would expand access to higher-quality, lower-cost health care for more Americans, regardless of medical history.
“Getting government out of the American people’s way and putting them back in charge of their own health care decisions will deliver a strong, efficient system that doesn’t force them to empty out their pockets to cover their medical bills,” said Dr. Paul. “There is no excuse for waiting to craft an alternative until after we repeal Obamacare, and the Obamacare Replacement Act charts a new path forward that will insure the most people possible at the lowest price.”
The Obamacare Replacement Act empowers the American people to: 1.) Choose inexpensive insurance free of government dictates; 2.) Save unlimited amounts in a health savings account (HSA) and have wider options for using those funds; 3.) Buy insurance across state lines; and 4.) Join together in voluntary associations to gain the leverage of being part of a large insurance pool.
Dr. Paul has led the charge to replace Obamacare at the same time it is repealed, and he has been joined in calling for simultaneous action by fellow Republicans including President Trump and Speaker of the House Paul Ryan. You can see Dr. Paul’s entire plan laid out section by section HERE, and you can find summary information below. Dr. Rand Paul’s Obamacare Replacement Act, S. 222: Legalizes Inexpensive Insurance Plans:
• Ensures that Americans can purchase the health insurance coverage that best fits their needs.
• Eliminates Obamacare’s essential health benefits requirement, along with other restrictive coverage and plan requirements, to once again make low-cost insurance options available to American consumers. Protects Individuals with Pre-Existing Conditions:
• Provides a two-year open-enrollment period under which individuals with pre-existing conditions can obtain coverage.
• Restores HIPAA pre-existing conditions protections. Prior to Obamacare, HIPAA guaranteed that those in the group market could obtain continuous health coverage regardless of preexisting conditions. Helps More People Save To Buy Health Insurance and Cover Medical Costs:
• Incentivizes savings by authorizing a tax credit (up to $5,000 per taxpayer) for individuals and families that contribute to HSAs.
• Removes the annual cap on HSAs so individuals can make unlimited contributions.
• Allows HSA funds to be used to purchase insurance, cover premiums, and more easily afford a broader range of health-related expenses, including prescription and OTC drugs, dietary supplements, nutrition and physical exercise expenses, and direct primary care, among others. Guarantees Fair Tax Treatment of Health Insurance:
• Equalizes the tax treatment of the purchase of health insurance for individuals and employers by allowing individuals to deduct the cost of their health insurance from their income and payroll taxes.
• Frees more Americans to purchase and maintain insurance apart from their work status.
• Does not interfere with employer-provided coverage for Americans who prefer those plans. Helps Individuals Join Together to Purchase Insurance:
• 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.
• Also allows individuals to pool together through any organization to purchase insurance.
• Widens access to the group market and spreads out the risk, enhancing the ability of individuals and small businesses to decrease costs, increase administrative efficiencies, and further protect those with pre-existing conditions. Allows the Purchase of Insurance Across State Lines:
• Creates an interstate market that allows insurers who are licensed to sell policies in one state to offer them to residents of any other state. Increases State Medicaid Flexibility:
• Enables states to fully exercise current flexibilities afforded to them through Medicaid waivers for creating innovative state plan designs. Empowers Physicians:
• Allows non-economically aligned physicians to negotiate for higher quality health care for their patients.
• Amends the Internal Revenue Code to allow a physician a tax deduction equal to the amount such physician would otherwise charge for charity medical care or uncompensated care due to bad debt, limited to 10% of a physician’s gross income for the taxable year.