Nunes Reintroduces Same Old Republican Health Care Plan

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Families Looking For New Ideas, Not Failed Ones

Today Republican Representatives Devin Nunes and Paul Ryan and Senators Tom Coburn and Richard Burr announced a “new” Republican health care plan to dismantle the employer-based health care system and make it harder for families to buy adequate health care coverage. But Americans rejected the same concept when Sen. John McCain proposed it during the 2008 Presidential election and will reject it again.

WHAT WERE THEY THINKING?

  • Sens. Tom Coburn And Richard Burr, Reps. Paul Ryan And Devin Nunes Will Introduce Republican Alternative Today. A Wall Street Journal Op-ed wrote of the Patients’ Choice Act, “Sens. Tom Coburn (Oklahoma) and Richard Burr (North Carolina) and Reps. Paul Ryan (Wisconsin) and Devin Nunes (California) – will today introduce a bill that moves away from federal centralization.” [Wall Street Journal Op-Ed, 5/20/09]

    THE TAX CREDIT WON’T BE ENOUGH TO BUY REAL COVERAGE

  • Under “The Patients’ Choice Act,” Tax Credit Would Be $5,700 For Families, $2,300 For Individuals, And An Additional $5,000 Debit Card For Low-Income Americans. In an Op-ed in the Wall Street Journal, it was revealed that a Republican alternative health reform plan, called the “Patients’ Choice Act,” would be introduced. It explained that, “Families would get $5,700 a year and individuals $2,300 to buy insurance and invest in Health Savings Accounts…Low-income Americans would get a supplemental debit card of up to $5,000 to help them purchase insurance and pay out-of-pocket costs.” [Wall Street Journal Op-Ed, 5/20/09]
  • Typical Family’s Health Care Costs Increased To $16,771 In The Last Year. “The total 2009 medical cost for a typical American family of four is $16,771, compared with the 2008 figure of $15,609. This is a 7.4% increase from 2008 to 2009.” [Millman Medical Index, 5/19/09]
  • CBO Director: Average Premiums For Family Would Cost $13,000 A Year. In testimony to the Senate Finance Committee, Doug Elmendorf, director of the CBO, said that, “premiums for employment-based plans are expected to average about…$13,000 per year for family coverage.” [CBO Testimony, 2/25/09]
  • CBO: Tax Credits To Buy Insurance Would Spend $65.5 Billion To Cover Only 2.2 Million Uninsured. CBO’s budget options outlined the effects of a plan to “create a voucher program to expand health insurance coverage,” which would subsidize individual purchase of insurance through tax credits. The plan analyzed would give $1,500 to individuals and $3,000 to families. It estimated that “the net reduction in the number of uninsured people under this option would be about 2.2 million,” while it would increase the federal deficit by $65.5 billion over 2010-2019. [CBO PDF, December 2008]

    THE PLAN WOULD DISMANTLE THE CURRENT EMPLOYER INSURANCE SYSTEM

  • “The Nexus Of [The Patients’ Choice Act] Is Redirecting” Employer Health Insurance Into Tax Credits. An Op-ed in the Wall Street Journal announced that a Republican alternative health reform plan, called the “Patients’ Choice Act,” would be introduced. It explained that, “The nexus of their plan is redirecting the $300 billion annual tax subsidy for employment-based health insurance to individuals in the form of refundable, advanceable tax credits. Families would get $5,700 a year and individuals $2,300 to buy insurance.” [Wall Street Journal Op-Ed, 5/20/09]
  • Employee Benefit Research Institute: Such a Tax Credit “Would Mean The End Of Employer-Sponsored Health Care.” Factcheck.org discussed Sen. McCain’s presidential campaign pledge of a $5,000 tax credit for families buying health insurance: “McCain’s plan to tax workers on the value of their employer-provided health care plans and provide tax credits would encourage some employers, mainly small businesses, to drop health benefits.” Director of the health research and education program at the Employee Benefit Research Institute Paul Fronstin said, “a tax credit plan like McCain’s likely would mean the end of employer-sponsored health care.” [Factcheck, 5/1/08]

    HEALTH SAVINGS ACCOUNTS DON’T WORK LIKE REPUBLICANS CLAIM THEY DO

  • Under “The Patients’ Choice Act,” Tax Credits Would Be Used To “Invest In Health Savings Accounts.” In an Op-ed in the Wall Street Journal, it was revealed that a Republican alternative health reform plan, called the “Patients’ Choice Act,” would be introduced. It replaced the employment-based health insurance system with a refundable tax credit system, and proposed to deposit the tax credit to “buy insurance and invest in Health Savings Accounts.” [Wall Street Journal Op-Ed, 5/20/09]
  • CRS Report: HSAs “Will Have Little Impact In Reducing,” Health Care Spending; It Is “Unreasonable” To Expect Them To Reduce Nation’s Health Care Costs. According to a report conducted by the Congressional Research Service on the effectiveness of health savings accounts, “While HSA plans may reduce healthcare spending, it would be unreasonable to expect them to produce a significant reduction in the nation’s health care costs…HSA plans with their relatively low out-of-pocket maximums will have little impact in reducing the health care spending for [high-cost individuals].” [CRS Report: “Health Savings Accounts”, 9/24/04]
  • CBO: Discontinuing New HSA Contributions Would Save $10.5 Billion, “Enhance Viability Of The Conventional Insurance Market…Prevent Higher-Income Taxpayers…From Using HSAs As A Vehicle For Wealth Accumulation.” CBO analyzed the effect of disallowing new contributions to Health Savings Accounts while leaving intact current HSAs. It estimated that such a move would increase tax revenues by $10.5 billion over 10 years, and would yield a number of other benefits. Discontinuing HSAs would “enhance the viability of the conventional insurance market,” because HSAs are “attractive primarily to relatively health people,” and “force insurance companies to raise premiums for” non-HSA plans. It would also “prevent higher-income taxpayers…from using HSAs as a vehicle for wealth accumulation.” [CBO PDF, December 2008]

    THE KICKER? PAUL RYAN AND RICHARD BURR ALREADY INTRODUCED PLANS LIKE THIS IN 2007 and 2008

  • Paul Ryan’s Healthcare Plan In 2008: Tax Credit To Purchase Insurance Coverage In Any State, And For Medicare, New HSAs. Paul Ryan presented a roadmap plan that included a number of health care reform proposals. It proposed a refundable tax credit of $2,500 for individuals and $5,000 for families “to purchase coverage in any state, and keep it with them if they move or change jobs.” Rep. Ryan also proposed to replace Medicare benefits with a payment of up to $9,500 that would be income and risk-adjusted, as well as set up Medical Savings Accounts for low-income beneficiaries within Medicare. Finally, it outlined certain reforms to state high-risk insurance pools. [American Roadmap, 5/21/08]
  • Sens. Burr And Corker Already Introduced Tax Credit Plan In 2008: $2,160 For Individuals, $5,400 For Families. In a press release from Sen. Bob Corker: “the Every American Insured Health Act (S.1886), co-authored by Sen. Corker and Sen. Richard Burr (R-NC), would provide every American a tax credit – cash in hand ($2,160 for individuals; $5,400 for families) – to purchase health insurance. These tax credits would be advanceable and refundable, so low-income families would have the money to make timed, monthly payments and would receive the full value of the tax credit, regardless of the amount of taxes they owe the government.” [Press Release, 5/27/08]
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