GOP's health plan takes shape

Whether it's the 2014 election cycle or President Barack Obama's in-your-face challenge during his State of the Union address, congressional Republicans are moving toward offering an alternative to the president's healthcare law this year.

In the three years since regaining control of the lower chamber, House Republicans have vowed to “repeal and replace” the Patient Protection and Affordable Care Act. The House GOP members made good on only the “repeal” portion, passing some 40 bills overturning the controversial 2010 law in whole or in part.

But with Obama in the White House for three more years and major reforms taking hold, the “replace” part of that vow is starting to take center stage. If nothing else, it will give Republicans more solid footing during the upcoming mid-term election campaign where they hope to maintain control of the House and win a Senate majority.

A series of actions and events in Washington last week suggested a major replacement bill is on the horizon. “The Republicans are finally going to end the free ride they've had on opposing Obamacare to offer an alternative,” said David Kendall, a senior fellow for health and fiscal policy at Third Way, a think tank that pursues centrist policies. “It will be nice to have a side-by-side comparison of Obamacare and a Republican plan.”

So far, the GOP healthcare plan is thin on details. A one-page fact sheet outlining the standards for replacing the ACA includes a mission statement and fewer than 10 “guiding principles.” They include “give healthcare security and peace of mind to all Americans,” “incentivize doctors to practice more medicine” and “find new cures and better treatments through innovation.”

In his first State of the Union address since his healthcare law's coverage provisions kicked in, the president spent little time talking about healthcare. But he did chastise Republicans for trying to overturn the ACA and challenged them—again—to produce a better solution if they have one.

“Now I don't expect to convince my Republican friends on the merits of this law,” the president said. “But I know that the American people aren't interested in re-fighting old battles. So again, if you have specific plans to cut costs, cover more people and increase choice—tell America what you'd do differently.”

The president goading the GOP to offer an alternative is not new. What is new is millions of Americans are gaining access to health insurance coverage because of the law, which mutes the advantage Republicans had last fall with the botched rollout of the insurance exchanges.

GOP lawmakers in both chambers of Congress have signaled in recent weeks that an alternative plan is imminent. During last week's three-day House GOP retreat along Maryland's Eastern Shore, House Majority Leader Eric Cantor (R-Va.) pledged that the House would pass an ACA alternative this year, according to a senior House GOP leadership aide.

Third Way's Kendall said he expects the GOP alternative will include provisions such as block grants for Medicaid and allowing insurance companies to sell the same policies across state lines. “The only way it can resonate is if they offer a way to fix the healthcare system and Obamacare,” he said. “If they continue to play to their base and repeal Obamacare and not do anything, that gets them elected in their primary elections in their district, but it doesn't win them a general election.”

G. William “Bill” Hoagland, senior vice president at the Bipartisan Policy Center, said the House GOP will likely try to eliminate the ACA's risk corridors for insurers, which were designed to provide some financial cushion to carriers offering health plans on the state and federal exchanges if an insurer's medical costs exceed actuarial expectations by a certain amount.

There were rumblings last week on Twitter that House GOP members discussed no “bailouts” for insurance companies during their retreat. Both Sen. Marco Rubio (R-Fla.) and Rep. Tim Griffin (R-Ark.) introduced companion legislation in November to remove the ACA's risk corridors.

There may also be some movement in the Senate on the GOP side. Sens. Richard Burr (R-N.C.), Tom Coburn (R-Okla.), who is retiring, and Orrin Hatch (R-Wyo.) unveiled an ACA alternative that would transition Medicaid to a capped allotment; reform medical malpractice laws; and cap the exclusion from taxable income of an employee's employer-sponsored health coverage. Senate Minority Leader Mitch McConnell (R-Ky.), meanwhile, is seeking help from the nation's Republican governors.

“We believe this law is flawed beyond repair, and the only true solution is to repeal Obamacare,” McConnell and two other senators wrote to the Republican Governors Public Policy Committee. “But that's not enough. Obamacare must be replaced with reforms that Americans support.”

Follow Jessica Zigmond on Twitter: @MHjzigmond