Rubio, Walker push ObamaCare replacements

Have we reached the point of delving into actual policy proposals? Donald Trump kicked off the substantive part of the primary cycle yesterday with a high-profile release of his immigration plan. Last night and today, Marco Rubio and Scott Walker have followed suit with their plans for repealing and replacing ObamaCare. Rubio published his post-ACA concept at Politico yesterday, although he wrote a nearly identical op-ed in March for Fox News:

My health care reform plan includes three primary components:

First, I will work with Congress to create an advanceable, refundable tax credit that all Americans can use to purchase health insurance. The value of these credits should increase every year, and we should set the tax preference for employer-sponsored insurance on a glide path to ensure that it will equal the level of the credits within a decade. This will prevent large-scale disruptions and reform a provision in our tax code that has been driving up health costs, hurting those who are self-employed and preventing Americans from having truly portable health insurance plans that travel with them regardless of where they work.

Second, I will reform insurance regulations to lower costs, encourage innovation, and protect the vulnerable. Those with pre-existing conditions should have access to affordable care through mechanisms such as federally-supported, actuarially-sound and state-based high risk pools. Americans should be able to purchase coverage across state lines so they can seek out affordable coverage regardless of where they live. And consumer-centered products like Health Savings Accounts should be encouraged and expanded. Finally, under no circumstances should taxpayers be asked to bail out an insurance company that loses money, as is currently the case under ObamaCare.

Third, I will take up the difficult work of saving and strengthening Medicare and Medicaid by placing them on fiscally-sustainable paths. Without reforms, these programs will eventually run out of money. We must move Medicaid into a per-capita block grant system, preserving funding for its recipients while freeing states from Washington mandates. While current seniors on Medicare, like my mother, should see no changes to the program, future generations should be transitioned into a premium support system. A premium support model will empower seniors with choice and market competition just like Medicare Advantage and Medicare Part D already do.

Basically, these are the concepts that have driven Republican alternatives since 2009, but in Rubio’s own formulation. The third pillar, premium price supports, will sound familiar to anyone who studied Paul Ryan’s own plan for budgetary reform and debt reduction. It’s a major part of the answer for controlling government health-care costs, which is what will drive national debt even farther into unreality over the next few decades, but few politicians want to face that reality. I’d like to see more work on reforming health insurance from the comprehensive model to a retail clinic/HSA/major-event indemnification system, which will actually drive prices lower through better competition and reduced overhead, but Rubio’s plan addresses the acute issues first.

Walker’s plan, released today, looks similar to Rubio’s. Medicaid reform is there, block-granting Medicaid is there, interstate commerce in health insurance is included as well. Walker’s plan does not include the Medicare reform that Rubio’s plan has, a surprising omission considering Ryan’s Wisconsin roots — or perhaps Walker just doesn’t want to fight two battles on one issue to start.

It does, however, include tort reform, which Rubio’s less-detailed plan does not mention, albeit a reform “encouraged” in the states rather than at the federal level:

It is critical that patients have the ability to pursue legal action if there is wrongdoing during their treatment. However, our current legal system has become a lottery, giving outsize awards to a very few, while failing to punish legitimate wrongdoing and compensate people for harm. The unfairness of this system leaves the door open for excessive litigation that in turn leads to “defensive medicine,” where doctors may over-treat some patients as a way to avoid frivolous lawsuits. My plan would encourage states to implement lawsuit reform to lower costs by limiting excessive litigation, while making sure consumers have opportunities to be compensated for harm and pursue legal recourse in instances of wrongdoing. My plan would incentivize states to pass meaningful lawsuit reform and encourage them to establish specialized expert reviews to determine if and when a doctor made a mistake, or commonsense legal defenses for doctors who demonstrate that they followed established clinical practice guidelines in a case.

Like Rubio, Walker doesn’t address the core issue of the lack of price signaling in the health-care markets. That’s a weakness, because it’s the rising costs of health care that drove the political demand for government intervention in the first place. The other concepts in both plans look solid, though, and will at least form the basis of a more market-oriented, moderately regulated approach that will contrast well with the disaster of ObamaCare in the present.