With five main candidates still standing (at least for now), we thought we’d take a moment to provide a quick review of where they stand on the issue of health insurance. Specifically, how should it be provided, through what channels, and who should pay for it? So here we go (we present the candidates and their respective positions in alphabetical order, using the candidates’ last names):
Ms. Clinton has defended and vows to continue to defend the Affordable Care Act, although she has publicly opposed the Cadillac Tax and vowed to repeal it. Her proposals would:
- Impose lower limits on cost-sharing, like deductibles and out-of-pocket expense maximums.
- Reduce prescription drug costs (her method for this is not entirely clear; it might involve price controls; it would definitely involve allowing Medicare to negotiate drug prices with pharmaceutical companies).
- Promote telemedicine.
Ms. Clinton recently has made noises in support of a single payer platform, but she has likely made these remarks simply to close the ideological gap between her and Bernie Sanders on this issue. Ms. Clinton may well favor, in her heart of hearts, a single payer approach, but after many years in Washington she is also a pragmatist, and likely sees a single payer proposal as a non-starter in the Congress, under almost any scenario.
Mr. Cruz would move to have “every single word” of the ACA repealed. His proposals would:
- Supply federal tax credits for purchasing private (presumably, individual) health insurance.
- De-link health insurance from employment.
- Allow health insurance to be purchased across state lines.
- Permit larger contributions to health savings accounts (HSAs).
Mr. Rubio has provided more details than most of the candidates about how he would deal with health insurance. He views the ACA as “fatally flawed,” and would make efforts to repeal it. His proposals would:
- Provide Americans with an advance refundable tax credit, increased annually for inflation, to facilitate the purchase of health insurance.
- Because currently, employer-provided health insurance is a 100-percent tax free benefit for employees, Mr. Rubio would reduce the tax-free nature of this benefit so that within a decade there is no difference in tax benefits between those relying upon the tax credit to purchase insurance, and those receiving employer-provided coverage. It’s not entirely clear whether individuals could use their tax credits to purchase employer-provided coverage (that is, could self-insured employers capture the tax credits provided to employees?).
- Allow the purchase of individual health insurance across state lines.
- Provide coverage, to those with pre-existing conditions, through state-based high risk pools.
- Allow for greater contributions to HSAs.
- Reform Medicare and Medicaid and ensure they are on a fiscally-sustainable path. Mr. Rubio would fund Medicaid via per-capita block grants to the states. Future Medicare enrollees would be subject to a “premium support system” providing greater choice and market competition.
Mr. Sanders has unapologetically embraced a single-payer approach, a “Medicare for all” system. Everyone would have access to comprehensive healthcare, from any willing provider.
Of course, someone needs to pay for all this. Mr. Sanders’s proposal includes, for starters, a 6.2 percent “income-based” premium paid by employers, and a 2.2 percent income-based premium paid by households. He would also raise income taxes on wealthier Americans, increasing the marginal federal tax rate to:
- 37 percent for household incomes between $250,000 and $500,000.
- 43 percent for household incomes between $500,000 and $2 million.
- 48 percent to 52 percent for household incomes in excess of $2 million.
Mr. Sanders would tax capital gains like ordinary income, for those with household incomes in excess of $250,000, and increase certain estate taxes.
Mr. Trump, at least until March 3, 2016, offered only the vaguest outline of his healthcare plan. He said he would repeal the ACA and replace it with “something terrific.” On March 3 he identified what he meant by “something terrific:”
- Allow any health insurer to sell its wares in every state (i.e., allow the purchase of health insurance across state lines).
- For those purchasing health insurance other than through an employer, allow a complete deduction for their premium costs (self-employed individuals may do this today; others — such as employees buying individual policies — may deduct their premium costs to the extent those costs and other out-of-pocket medical expenses exceed a certain portion of their adjusted gross income).
- Allow individuals to use HSAs. Interestingly, Mr. Trump’s explanation of how he’d like to see HSAs operate largely mirrors existing law; for example, he says “contributions into HSAs should be tax-free and should be allowed to accumulate.” Of course, HSAs do that today. Perhaps he means taxpayers would be allowed to increase their contributions into HSAs.
- Require price transparency from all healthcare providers.
- Allow Medicare the freedom to negotiate drug prices with pharmaceutical companies.
- Fund Medicaid with block grants to the states.
- Allow consumers the ability to obtain prescription drugs from providers outside the U.S.