Rand Paul’s Obamacare Substitute: Take Two Aspirin and Call Me in the Morning
Policy + Politics

Rand Paul’s Obamacare Substitute: Take Two Aspirin and Call Me in the Morning

Photo: REUTERS/Kevin Lamarque

As the incoming Trump administration over the weekend reaffirmed its commitment to simultaneously repeal and replace the Affordable Care Act, Republican Sen. Rand Paul of Kentucky got an early jump in promoting his vision of a suitable – but relatively threadbare – replacement.

During an appearance Sunday on CNN, Paul unveiled the broad outlines of his plan that contains a number of measures favored by House Speaker Paul Ryan (R-WI) and Rep. Tom Price (R-GA), the nominee to become the next secretary of Health and Human Services. Those include tax credits to help Americans defray the cost of health insurance premiums and increased use of tax-exempt Health Savings Accounts.

Related: Rand Paul Is Coming to the Rescue with an Obamacare Replacement Plan

But central to Paul’s approach is totally scrapping Obamacare mandates and minimum coverage requirements that the Kentucky lawmaker says discourage younger, healthier Americans from purchasing individual plans. Instead, Paul favors dramatic changes in the system that would foster the sale of cheap, bare-bone health insurance policies.

Currently plans sold in the individual market under Obamacare must include 10 “minimum essential benefits,” such as doctors’ services, inpatient and outpatient hospital care, prescription drug coverage, pregnancy and childbirth and mental health services. Paul would scrap all those requirements and allow people to purchase coverage keyed to their specific needs and income.

“So one of the key reforms we do is we’re going to legalize the sale of inexpensive insurance,” Paul told CNN’s Jake Tapper. “That means getting rid of the Obamacare mandate on what you can buy.”

That approach would also have the effect of lowering the overall quality of health care in the country, but Paul didn’t comment on that. Moreover, it would make it far more difficult for major insurers to offset the cost of providing coverage to older and sicker beneficiaries with substantial premium payments from younger Americans. 

Related: 5 Key Pieces of a ‘TrumpCare’ Plan that Could Affect Your Health

Paul said he will also press for authorization for small businesses to band together to form networks to purchase insurance at a relatively low cost. Paul, who worked for years as an eye surgeon, said, “There’s no reason why someone with four employees shouldn’t be able to join with hundreds and hundreds of other businesses that are small to become a large entity to get leverage to bring your prices down.”

He said those negotiations with insurers could also be used to guarantee the availability of policies that "can't cancel you and guarantees the issue of the insurance even if you get sick."

Paul dodged the question of whether many of the 20 million Americans currently receiving coverage under Obamacare would lose their coverage under his approach. A key question is whether the Republican majority in Congress and the Trump administration will attempt to rescind expanded Medicaid that provides the vast majority of Obamacare coverage in 31 states and the District of Columbia. Nearly 400,000 Kentucky residents would stand to lose coverage if that were to happen.

Paul appeared to favor eliminating expanded Medicaid, insisting that the federal government can’t afford to finance the program indefinitely with the national debt fast approaching $20 trillion.

 “My point is that we should be honest about it,” Paul said. “If Kentucky or Tennessee or Ohio wants to expand Medicaid and they say we have a lot of people struggling and we’re willing to help them, that’s fine. Probably we should then raise the taxes on everybody in Kentucky [and the other states] to pay for Medicaid,” he added. “Instead, we have this deceitfulness of President Obama saying it would be free.”

Related: Trump Promises to Repeal and Replace Obamacare Together, But Can It Be Done?

Paul last week was one of the first on Capitol Hill to align himself with President-elect Donald Trump in insisting it would be a huge tactical mistake for the GOP to dismantle key elements of the Obamacare law before pulling together replacement legislation. He believes that garnering the support of rank-and-file Republicans would quell fears of chaos in the insurance market and the loss of coverage for millions of Americans.

Some GOP leaders, including Senate Majority Leader Mitch McConnell, Paul’s fellow Kentuckian, argued that the Republican-controlled Congress should first approve a budget resolution repealing key elements of Obamacare, including its subsidies, taxes and mandates, before beginning the challenging task of adopting a replacement plan. McConnell said that Congress would follow up Obamacare repeal legislation with a replacement program “very quickly,” but without setting a timetable.  

But President-elect Donald Trump last Wednesday made it clear that action to repeal and replace had to occur at the same time – possibly on the same day or “the same hour” – and Paul agrees.

“I believe that it’s incredibly important that we do replacement on the same day as we do repeal,” Paul told Tapper. “We’ve had six years to complain [about Obamacare] and we have complained. I’ve been one of those complaining about Obamacare. Replacement should be the same day.”

Related: Why Republicans Are Hitting the Brakes on Obamacare Repeal

Late last week, the Senate and House voted to begin the legislative process that would culminate in final action – perhaps as early as next month -- to repeal Obamacare, but without addressing a possible replacement. Paul was the lone Republican in the Senate to vote against the resolution while nine Republicans in the House also opposed it.

Ryan and other GOP House leaders now say they agree with Trump that repeal and replace must be accomplished simultaneously, in order to keep their campaign pledge and reassure the public and the insurance industry. McConnell has been non-committal on the topic, in part because he will need Democratic support in order to adopt comprehensive replacement legislation.

Vice President-elect Mike Pence reaffirmed Trump’s pledge to get both tasks accomplished in record time during an appearance on the “Fox News Sunday” program.

 “The president-elect made it very clear to leaders in the Congress this week that he wanted to do both at the same time,” Pence said. “I would anticipate that in the first 100 days that we will deliver on that promise to the American people.”