The CARE Act: A New GOP Approach to the ACA or a Missed Opportunity?

by Anthony Wilson, California Healthline Contributing Editor

TOPIC ALERT:

"[I]f you have specific plans to cut costs, cover more people, increase choice, tell America what you'd do differently. Let's see if the numbers add up. But let's not have another 40-something votes to repeal a law that's already helping millions of Americans ..." -- President Obama, last week in his State of the Union address


Three Republican senators -- Richard Burr (N.C.), Tom Coburn (Okla.) and Orrin Hatch (Utah) -- seem to have done just that, and hours before Obama delivered his speech.

On its face, the Patient Choice, Affordability, Responsibility and Empowerment Act, or CARE Act, feels different than the other plans offered by the GOP.

Yes, the proposal guts many of the ACA's major provisions. It would repeal the ACA's individual mandate, employer mandate and minimum coverage requirements, among other things.

However, unlike most other Republican proposals, the CARE Act would keep in place some of the more popular pieces of the ACA, such as banning insurers from imposing lifetime limits on benefits and allowing children to remain on their parents' health plans until age 26.

Below, California Healthline examines what health policy experts are saying about the proposal.

Plan Would Slash Premiums

Almost immediately after the CARE Act was unveiled, the Center for Health and Economy released its analysis. CH&E, formed by conservative economist Douglas Holtz-Eakin, features a board with a number of noted economists, including Princeton University professor Uwe Reinhardt.

The analysis, which assumed that the ACA would be fully repealed and the CARE Act would be enacted by 2017, found that the proposal would lower premiums by between 2% and 11% for individual policies by 2023, largely because of its provisions seeking to end "junk lawsuits" and "defensive medicine."

CH&E also found that the federal government would save $1.4 trillion, in part because the plan would reduce the number of U.S. residents covered by Medicaid. Further, the more easily available subsidies and tax credits in the CARE Act would result in a "significant increase in individual market participation," although that would be offset by reduced Medicaid eligibility.

Compliments, Criticism From Surprising Sources

Meanwhile, some supporters of the ACA have been almost complimentary to the CARE Act. For example, Ezekiel Emanuel, a senior fellow at the Center for American Progress and a former adviser to the Obama administration, lauds Burr, Coburn and Hatch in a New York Times op-ed, writing that it is "hard and politically courageous" to put together a health reform plan and that they "deserve credit" for doing so. He even goes so far as to say the blueprint has some "interesting ideas," but he does point out that some of its provisions are flawed.

On the other hand, Dean Clancy, vice president of public policy for FreedomWorks, in a Daily Caller op-ed calls the CARE Act "a definitive example of the wrong way" to reform health care.

'Just Another Repeal Proposal'

Many ACA supporters are lambasting the proposal. White House press secretary Jay Carney dismissed the CARE Act as "just another repeal proposal." 

And, in a post titled, "The Five Worst Things About The New Republican Proposal To Replace Obamacare," CAP's "ThinkProgress" blog argues that the CARE Act would "kick millions of Americans off of their health plans."

Missed Opportunity

Some are saying that Burr, Coburn and Hatch's plan might be a case of too little, too late.

In a post in his "freeforall" blog, Donald Taylor, a professor of public policy at Duke University specializing in health policy, writes that Burr and Coburn "missed a big opportunity" in the first few months of 2010, when Democrats were putting the finishing touches on the ACA. The two senators could have rallied support from fellow committee Republicans to propose alternatives to the ACA at that point.

Instead, Taylor says that Burr and Coburn "chose full opposition and gross overstatements in their arguments against the ACA," opting to take a position counter to Sen. Olympia Snowe (R-Maine). He concludes, "In the end, [Burr and Coburn] helped to create and exacerbate the political culture that will make it so hard for their proposal to be given the subtle, and nuanced listen that it deserves."

Emanuel agrees. In an interview with California Healthline, Emanuel said that Burr, Coburn and Hatch "missed their opportunity to negotiate seriously" in 2009 and 2010, and now there is an "absence of a typical sausage making of a bill where you horse trade things you're not really wild about to get the other side's vote." He added, "Now we're not in that time. Now, health care reform's well under way."

Blueprint Has No Future, But Signals New Strategy

It is unlikely the CARE Act will advance, considering the Democratic-controlled Senate and Obama in the White House. And while it doesn't necessarily mark a sea change in relations between Democrats and Republicans on the health policy front, the introduction of the CARE Act might hearken the beginning of a different strategy from the GOP.

Stephen Parente, a professor and director of the Medical Industry Leadership Institute at the University of Minnesota and an advisory member for the Center for Health and Economy, tells California Healthline that the blueprint could represent a GOP that is more willing to work in a bipartisan fashion to reform the health care system.

Parente knows a thing or two about working on both sides of the aisle. He was the health policy adviser for John McCain's 2008 presidential campaign and served as legislative fellow in the office of Sen. Jay Rockefeller (D-W.Va.) in the early 1990s.

According to Parente, the CARE Act could be viewed as a sort of admission from a small slice of the GOP. Parente says, "One could look at the CARE Act as the Republicans, ever so slightly, claiming back their ownership over market-based health reform and saying, 'ACA kind of was our design. We don't want to admit it, but back in the day, circa 1991, this wasn't so far-fetched, and we understand times have changed, but if you're going to take our playbook, let us at least tune the playbook up and make it actually work in the 21st century.'"

The CARE Act also could help Republicans position themselves in the upcoming midterm elections. At a time when public opinion of Congress is at an all-time low and the electorate is tiring of the divisiveness between Democrats and Republicans, the CARE Act could become a less-contentious GOP talking point.

Joseph Antos, a health care policy expert at the American Enterprise Institute, told Reuters that the CARE Act "gives [Republicans] an opportunity to talk about these things in a more positive way than just repeal and replace."

Around the nation

Here's a quick review at what else is making news on the road to reform.

Top team, top exchange? The Washington Post's "Wonkblog" notes that it's not just Seattle's pro football that's the best at what they do. The state's health insurance exchange also is tops in the nation in the percentage of eligible population enrolled in its exchange.

High-cost health care. Kaiser Health News has compiled a list of the top 10 most-costly insurance markets under the Affordable Care Act, and some of the regions might surprise you. 

Bailout or boon? Republicans have been critical of the ACA's "risk corridors" provision, in which health insurers can receive federal payments to help offset high costs they might incur by enrolling a higher-than-anticipated number of sick individuals through the health insurance exchanges, calling it a "bailout" for insurers. However, a Congressional Budget estimate out Tuesday finds that the provision would actually save the federal government about $8 billion, because insurers must pay the government when their costs are lower than expected.


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