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Millions will lose health insurance, but...

Republican Health Care Plan Saves Money

March 15, 2017
Plain English Version

The Congressional Budget Office seal. Photo credit: Chip Somodevilla/Getty Images

Everyone waited for the CBO report on the cost of the Republican’s American Health Plan. It came out Monday. It showed that over time the plan would save money. Saving money is big news. Republicans welcomed the finding.

There was a catch. To save the money, millions of Americans will go without health insurance. Not such good news.

For Democrats and many others, the big question was, “will I lose my health insurance?” No one will lose his insurance if he can pay for it. Money will still buy health care

The Affordable Care Act (Obamacare) helped lower-income pay for their health insurance. The Republican plan also helps but in a different way.

Obamacare helps people with a subsidy. The subsidy depends on income. The Republican plan offers a tax credit to all. The amount you get may be less than the amount of your premium. You would have to find the money elsewhere. If you could not, you are out of luck. That is why the report says that 24 million Americans will not have health insurance.

An expert said the bill ends benefits for the elderly, poor, sick and middle class. It uses the tax code to send money to the wealthy. That is why Democrats say the plan “transfers income from the poor to the rich.”

The Republican plan is a one-two punch. The plan also reduces federal spending on Medicaid. Medicaid is health insurance for people who have low incomes. The real savings cited in the report is the reduction in spending on Medicaid.

The plan turns Medicaid over to the states. The current open-ended funding for the program becomes a block grant. It is a fixed amount of money. Many governors do not like the idea. Even Republican governors like the flow of federal money.

Some Republicans said they would not believe the CBO report. They will contest the part where people lose benefits. They will welcome the part where spending goes down.

Experts say the plan is a do-or-die test. Can Republicans govern the nation? If they cannot “repeal and replace” Obamacare, what can they do?

Source: The New York Times March 13, 2017

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