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Jeb Bush rolls out health plan aiming to make care more affordable

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WASHINGTON — Jeb Bush on Tuesday offered a detailed proposal to replace much of the Affordable Care Act with a more conservative health care plan that could lower individual insurance costs but would probably not protect as many people as President Obama’s initiative.


“Innovations, not mandates, will bring down health care costs,” Mr. Bush said at St. Anselm College in New Hampshire. “If we’re going to fix health care in this country, we need to wrest control away from Washington and give it back to the states, citizens and their care providers.”


Jeb Bush is promising to repeal Obamacare. But there’s one thing he would keep: a way to tax high-cost health plans. Mr. Bush’s plan would make good on Republicans’ oft-stated pledge to repeal and replace Mr. Obama’s signature domestic achievement, but it also points up the trade-offs that he and other Republican presidential candidates face. His reliance on low-cost catastrophic health plans could reduce premiums for some consumers, but could also leave them with fewer health benefits, and he would also loosen the Affordable Care Act’s popular guarantee of coverage, regardless of a person’s pre-existing medical conditions.


Mr. Bush would dismantle the elaborate structure of the health care law, offer income-tax credits for people to buy catastrophic coverage and offer states a sort of block grant to finance care for low-income people.


He would allow states to impose work requirements on able-bodied Medicaid beneficiaries, requirements that are opposed by the Obama administration but favored by some state officials.


Mr. Bush promised to work with states to develop a transition plan for 17 million people who are currently covered under the health law, or, as he put it, “entangled in Obamacare.” The president’s health law was “written by special interests, for the special interests,” Mr. Bush said. His proposals are consistent with priorities long favored by Republicans. He would give states more discretion over health care and more authority to regulate health insurance, rolling back many of the detailed federal standards set by the Affordable Care Act and in rules issued by the Obama administration.


Some of Mr. Bush’s proposals could upset some people with employer-provided coverage. For example, he would limit the amount of tax-free health benefits that employees can receive from employers, capping the value at $12,000 a year for an individual and $30,000 for a family. Under current law, the value of employer-sponsored insurance is not counted or taxed as income for employees. Mr. Bush said the proposed limits would “encourage lower insurance premiums and higher wages.” His proposal would replace an excise tax that the Affordable Care Act imposed on certain high-cost, employer-sponsored insurance plans. Mr. Bush said employers were arbitrarily reducing benefits to avoid this “Cadillac tax,” which is to take effect in 2018.


But the goal of his proposed cap on tax-free benefits appears to be similar. Many economists say the current tax-free treatment of employee health benefits tends to encourage the overuse of health care by insulating consumers from the true costs. Gail R. Wilensky, who ran Medicare and Medicaid from 1990 to 1992 and is an informal adviser to the Bush campaign, said Mr. Bush’s speech “provided a lot of detail compared with what you normally see from candidates on the campaign trail.”


The White House declined to comment on Mr. Bush’s proposals. The Democratic National Committee dismissed them as a catalog of lofty promises with no viable replacement for the 2010 law. “His health care plan, like all of his other proposals, would help Jeb Bush and the wealthy like him while slashing and gutting a law that has insured over 17 million Americans and lowered the rise of health care costs,” the committee said.


The Congressional Budget Office has said that similar proposals, offered by Republican lawmakers in the past five years, would not expand coverage as much as the Affordable Care Act. Gains in coverage in the past two years result, in part, from the law’s expansion of Medicaid eligibility and from tax credits provided for the purchase of private insurance through new public marketplaces, health policy experts say.


In repealing the health law, Mr. Bush would eliminate the requirement for most Americans to carry health insurance and to pay tax penalties if they go without coverage.


Tax credits under the Bush plan appear to be less generous than those provided under the Affordable Care Act, but they would probably be available to more people. Mr. Bush’s tax credits would be available regardless of a person’s income and would be adjusted for age, with more assistance for older people.


Mr. Bush said the federal health law forced Americans to buy “expensive products with benefits they do not want and may never need.” He said that he would roll back the mandate for “essential health benefits” and give states discretion to allow lower-cost plans providing catastrophic coverage. Premiums could be lower as a result, he said. In his proposal, Mr. Bush said, “Obamacare created huge new subsidies for low-income Americans, but it left middle-income Americans facing higher premiums and higher out-of-pocket costs.” He said he would “give individuals without an offer of job-based coverage a tax credit, regardless of income, to help cover the cost of plans that provide preventive care and comprehensive protection for high-cost medical events.” Also, Mr. Bush said, if employers cannot afford to provide insurance to workers, he would allow them to make tax-free contributions to the cost of health insurance purchased by employees on their own.


Federal law has long given a tax break to employers that provide coverage. But the Internal Revenue Service has ruled that the tax break is generally not available when employers reimburse employees for coverage that they buy themselves through the new insurance marketplaces, or exchanges. Mr. Bush would also allow states to modify the current requirement for insurers to offer coverage to anyone who requests it. States could, for example, limit the guarantee so it would apply just to people who have been continuously insured, without a break in coverage.


Until states devise a workable alternative, Mr. Bush said, “there will be a federal continuous coverage protection.” In other words, he said, “if an individual has maintained health insurance, they cannot be denied coverage when moving to a new state or changing insurance.”


Mitt Romney, the Republicans’ 2012 presidential nominee, also proposed limiting the guaranteed coverage of pre-existing medical conditions to people who maintained consistent health insurance, arguing that it would prevent people from forgoing insurance until they got sick. The proposal proved to be a lightning rod in the 2012 campaign.

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