Trumpcare and A Better Way Plan

How Trumpcare Differs from Republican Healthcare Policy – A Better Way Plan 

When it comes to certain issues, Donald Trump does not necessarily fall in line with other Republicans, particularly in terms of health care reform. On some points, they do agree. Cutting federal spending, reducing taxes and improving health services for low-income Americans are among the issues that Republican members of Congress and Trump agree on. But there’s some debate between the new president and his party on how to accomplish these and other aspects of reform. Trumpcare will involve three major points:

  • Repeal and replacement of the Affordable Care Act (ACA)
  • Universal health insurance coverage
  • Lower insurance premiums and costs

Trump has suggested a single-payer system and expressed interest in a socialized one. This is generally criticized by Republicans who would rather have a free-market system run by private enterprise. A single-payer health system is one where the government provides all health insurance plans. Socialized health care means that the government owns the entire health care system, including insurance companies, hospitals and medical service providers.

A study was conducted by the Fraser Institute on Canada’s single-payer system in 2014, and results showed an extreme increase in wait time for medically necessary treatments. Over a period of 24 years, wait times increased from 9.3 weeks to 18.2 weeks and nearly triple that for major surgery. Like the situation with the U.S. Veterans Administration, people could potentially die before receiving care. Canadians who can afford it rely on the U.S. for purchasing critical care. Europe’s socialized system suffers from similar drawbacks, but Europeans lack the advantage of a neighboring safety net.

Will Trumpcare Repeal the Individual Mandate

President-elect Trump wants to remove the individual mandate so that people have a choice regarding the purchase of insurance. This would naturally happen under a full repeal of the ACA, but Trump wants to keep key provisions of Obamacare, including the requirement that insurers cover people with pre-existing conditions and the right for young adults to stay insured on their parents’ policies until age 26. What Trump is proposing, then, is not a full repeal but a heavily modified reworking of current legislation. By contrast, Republicans – especially the more dogmatic in the House and Senate – want to axe the health care law entirely and replace it with something different.

Trumpcare Taxes and Subsidies

Trump will provide premium tax credits and deductions directly at tax time. The details of the tax structure are unclear, but the chronically ill would likely need caps based on income to afford coverage under pre-existing conditions. However, Republicans want a tax credit that does not vary based on income or prior health status. It’s uncertain how Trump feels about potential caps, but he has eluded to subsidizing state-based high-risk pool programs. Conservatives generally dislike government controlled caps and subsidies.

A Better Way Plan

House Speaker Paul Ryan’s A Better Way shares certain features with Trump’s universal health care scenario, with lower medical-related costs via eliminating loopholes in the ACA law and prohibiting discrimination based on gender and pre-existing conditions. Providing health insurance premium tax credits and deductions also resembles Trump’s plan.

Republicans and Trump also favor Health Savings Accounts (HSAs), which are believed to be the solution to getting younger, healthier people insured under the new program. Trump and his party agree that using HSAs for individuals will encourage enrollment, ease the financial burden of health care and eliminate excessive government spending, particularly if the death tax penalty is removed from the equation.

Trump and conservatives also agree on removing the entry barrier to free-market competition between pharmaceutical companies. Doing so would promote better quality, reduce medication costs and allow negotiation on the Medicare program’s drug pricing structure. The Republican relationship to pharmaceutical special interest groups would be tested. If Trump entertained a socialized structure, it would control the industry and pricing.

Republicans and the president-elect believe that insurers should be able to sell across state lines to lower prices and encourage competition. Free-market competition is at odds with the single-payer structure as insurance companies would be government run, so it’s not clear how Trump reconciles a single-payer health care system with his ideas about private industry.

Trumpcare resembles conservative thinking, but an attempt to create a hybrid free-market and single-payer system changes the level of government control and how these plans, drugs and medical services are provided.