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Conservatives Rally Around Their Own Health Care Plan

Obamacare replacement plan might make GOP consensus more difficult

Freedom Caucus Chairman Mark Meadows speaks as South Carolina Rep. Mark Sanford listens during the caucus’ news conference on Wednesday on health care law replacement legislation. (Bill Clark/CQ Roll Call)
Freedom Caucus Chairman Mark Meadows speaks as South Carolina Rep. Mark Sanford listens during the caucus’ news conference on Wednesday on health care law replacement legislation. (Bill Clark/CQ Roll Call)

Conservative Republicans on Wednesday staked out their position on a proposed replacement to the 2010 health care law. But their views are likely to muddle the path toward GOP consensus.

The House Freedom Caucus endorsed legislation authored by one of its members, Rep. Mark Sanford of South Carolina, and Kentucky Sen. Rand Paul.

“Conservatives have come together to say that this is the replacement plan that we not only want to promote but debate and hopefully fine-tune,” said North Carolina Rep. Mark Meadows, the caucus chairman.

The measure, titled the Obamacare Replacement Act, aims to de-link insurance coverage from employment and remove minimum coverage mandates, allowing consumers to purchase plans that fit their individual needs.

“This bill, like no other, empowers the consumer and emboldens the marketplace,” Sanford said.

The proposal would provide a two-year enrollment period for people with pre-existing conditions, in which they would be able to sign up for an insurance plan without fear of cancellation, and includes a continuous coverage provision to provide those individuals with the ability to move plans if their employment situation changes.

To help individuals pay for insurance, the plan calls for a nonrefundable tax deduction and expanded access to and use of health savings accounts that would allow individuals to use those tax-exempt funds for “vitamins, weight loss, you name it,” Paul said.

Sanford said the proposal represents an “inflection point.”

“This is not about replacing the Affordable Care Act or Obamacare,” he said, although the title of the legislation suggests otherwise. “This is about where we go next in terms of health care so that people are in control.”

Paul said the bill includes policy ideas Republicans all agree on, while leaving out controversial elements like Medicaid expansion. But there are still parts of the plan that are out of step with other GOP proposals, including the House Republicans’ “Better Way” blueprint.

For example, the Better Way plan calls for a refundable tax credit to help people purchase insurance in the individual marketplace. That idea is “essentially a subsidy by another name,” Paul said.

Meadows agreed, saying that it amounts to the creation of a new entitlement program and that refundable tax credits are susceptible to fraud. “I think the refundable tax credit is very problematic to get to 218 votes” in the House, the North Carolina Republican said.

Paul and Sanford have modeled their tax deduction for individuals purchasing insurance off the one employers get now for providing coverage to their employees. To pay for it, Paul said he does not want to raise taxes; he’d rather cut government spending. “Why don’t we have a tax cut and a spending cut?” he said.

That offset idea would definitely not fly with Democrats, but many Republicans also believe tax cuts should be paid for with corresponding revenue increases.

The conservatives’ proposal does not include a mandate that insurers allow children to stay on their parents’ insurance plans until age 26, a component of the health care law that President Donald Trump, House Speaker Paul D. Ryan and other GOP leaders have said they would keep.

“We believe when you have a number of different options, that the markets will be able to provide that much cheaper than what they’re doing now because people 26 years of age and younger are healthy,” Meadows said. “So having that as an option where a health provider says, ‘You can cover your adult child for a nominal premium’ — when you really look at the actuarial tables, it would be a lower cost.”

Still, Meadows acknowledged that Republicans are still not on the same page regarding a replacement plan, even as House lawmakers are holding breakout sessions to dig into strategy and policy details.

“I don’t know that it’s brought any more consensus as much as it’s brought more questions that need to be answered in further breakout sessions,” he said.

While the consensus path toward replacing the law remains unclear, the GOP still lacks consensus on how much or how little to include in a repeal measure.

The Freedom Caucus on Monday voted to take an official position calling for the House to pass the same 2015 reconciliation measure for repeal that  Obama vetoed in 2016. House GOP leaders have advocated what they call a “repeal plus” strategy that would include some pieces of a replacement plan in the repeal measure.

Conservatives say they wouldn’t vote against a “repeal plus” bill but they are advocating the 2015 repeal bill because they know it can pass in the Senate and meet that chamber’s stringent rules for reconciliation.

“Repeal is our first priority,” Meadows said. “I believe we can get to consensus on some replacement vehicle. And I would feel much more comfortable if we voted on a replacement the same week as we do on repeal.”

The House Republican Conference will hold a planning meeting Thursday morning to continue discussions on the repeal and replace strategy during which Energy and Commerce Chairman Greg Walden and Ways and Means Chairman Kevin Brady are expected to detail plans to enact the replacement proposals in the Better Way plan.

While the Freedom Caucus’s endorsement of the Sanford-Paul plan shows that there isn’t agreement on all of the Better Way proposals, members remain optimistic that consensus can be found.

“We’ve had six years to think about it,” Meadows said. “I think we can get it done in the next six weeks.”

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