Four Things You Need To Know About the RSC Healthcare Plan

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Posted by Tom Hebert, Samantha Capriotti on Tuesday, November 12th, 2019, 9:00 AM PERMALINK

The Republican Study Committee recently released a framework to reform our nation’s healthcare system. The plan, entitled “A Framework for Personalized, Affordable Care,” provides a much-needed alternative to the radical government takeover of healthcare that the left is pushing. 

The left’s plan, which they disingenuously call “Medicare for All,” would kick 180 million Americans off of their private coverage overnight and require $32 trillion in new taxes over the next decade. Government-run healthcare would raise taxes on every American and lead to drastic reductions in the quality of healthcare. 

In contrast to this radical proposal, the RSC healthcare plan makes numerous improvements to the U.S. healthcare system that will ensure competition, access, and quality for every American. 

Here are four things you need to know about the RSC’s healthcare plan. 

Expands Health Savings Accounts (HSAs)

HSAs are tax-advantaged savings accounts that gives patients choice and flexibility in paying for their health needs. HSAs are double-tax advantaged: the funds are not taxed when earned as income or as they accrue interest. HSAs are used in conjunction with low premium, high deductible health insurance plans and are used by over 25 million American families and individuals. 

The RSC plan expands HSAs by allowing individuals to use them to pay their healthcare premiums. The RSC plan also expands the accessibility and effectiveness of HSAs by eliminating the requirement that HSAs be tied to a high-deductible plan. The plan also increases the HSA maximum contribution limit and expands the scope of eligible health care expenditures. 

Importantly, the RSC plan allows working seniors and other Medicare recipients to contribute to an HSA. This will end the discrimination against working seniors who cannot be on Medicare if they choose to keep their HSA.

Expands Access to Innovative, Patient Centered Care

The RSC plan expands access to innovative care for American patients in several ways. 

The framework calls for expanding direct primary care — the facetime that patients share with doctors — without raising costs. The RSC plan will allow patients to use their HSAs to pay the $60 - $70 monthly fees that fund direct primary care.  

The proposal also contains reforms that allow individuals to increase their negotiation power and receive care through economies of scale. The plan promotes health sharing ministries, which allow members of nonprofits to pool their funds through monthly dues and to only fund programs for which they would need coverage. 

In addition to these reforms, the RSC codifies the Trump Administration’s expansion of short-term, limited duration plans into law. These plans are useful for consumers in between jobs or with temporary gaps in coverage. 

Strengthens Medicaid for Future Generations 

Medicaid is on an unsustainable path. Federal spending on the program has skyrocketed from $14 billion in 1980 to a projected $702 billion in 2029. Over the next decade, Medicaid expenditures on the Medicaid expansion population alone is projected to approach $938 billion. 

To streamline the program, the RSC healthcare plan calls for a moratorium on future Medicaid expansions and a phase out of the expansion’s enhanced FMAP rate. This ends the subsidization of able-bodied adults without dependents at the expense of the truly disadvantaged –– poor pregnant women, seniors, children, and the disabled. 

The RSC plan also replaces Medicaid’s open-ended entitlement structure with separate per capita grants to better serve Medicaid’s traditional beneficiaries. The plan allows for Medicaid to combine the Children’s Health Insurance Program with the Medicaid grant for children. A flex-grant would also allow states to subsidize the healthcare of low-income individuals, subject to work requirements. 

Protects Pre-Existing Conditions and Enhances Healthcare Portability

Healthcare portability — the ability of an individual to carry their healthcare protections with them — is a cornerstone of the RSC’s healthcare plan. Portability is essential to preventing breaks in coverage for individuals, where an individual could develop a condition that would serve as an impediment to getting reinsured. 

Most importantly, portability is a protection against individuals being denied coverage because of pre-existing conditions. The RSC plan provides a legal framework to ensure that coverage protections are portable. 

The RSC plan ensures that individuals that move from the employer marketplace to the individual marketplace do not need to exhaust COBRA coverage before entering the market with portability protections. The RSC plan also ensures that individuals seeking coverage in the individual marketplace could not be refused a plan due to health status, medical condition, claims experience, receipt of healthcare, medical history, genetic information, evidence of insurability, or disability.

Photo Credit: Güldem Üstün

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