Applying Paul Ryan

[Geee]

American Spectator:

At the Hoover Institution at Stanford University on Sep. 27, Republican chairman Paul Ryan of the House Budget Committee supplied an Obamacare alternative.

Two main points of Ryan's speech have already been embraced by Republican leadership: 1) A proposal to give states a fixed amount of money to run Medicaid, instead of having spending tied to the amount individual states decide to cover the poor; and 2) "Premium support" for future senior citizens, who would purchase private, but federally subsidized, insurance.

Ryan made it clear that the biggest immediate problem with Obamacare is that it does not impact the tax code, which will continue not to tax benefits as wages. This inflationary policy encourages companies to provide benefits instead of providing higher wages for employees to buy their own, personalized coverage. Ryan's proposal is to offer the same tax credit to businesses and individuals buying insurance, with the expectation that individuals will choose to buy cheaper coverage and create competition that will drive premiums down.

The tax code change, according to Ryan's office, would likely reduce the number of people denied coverage due to a pre-existing condition, as insurance would not be tied to employers, and thus changes in insurance would be infrequent.

This proposal was suggested by Senator John McCain in 2008, and the senator learned it faces potential backlash from vulnerable Republicans. Not only does the proposal bring to the forefront the possibility of current healthcare insurance arrangements being changed, but liberal health care experts are quick to point out that if young, healthy adults buy cheap individual policies in this fashion, other employees would either pay more or no longer have coverage. This is why Ryan's office stresses the need for a transitional approach, initially allowing only those without access to employer provided health insurance to buy insurance without a tax penalty.

Although not officially endorsed by Ryan, on the state level there is already a movement by Tea Party grassroots activists which could tie neatly into Ryan's proposal to provide fixed amounts to individual states. Using an "interstate compact," a serious effort is underway to replace federal Medicaid and Medicare with block grants. If ratified, individual states would be tasked with developing their own model to replace federal public health care services.

This new nonpartisan proposal was drafted by the Health Care Compact Alliance, which is chaired by Eric O'Keefe of the Chicago-based Sam Adams Alliance, with key financial backing from vice chair Leo Linbeck III, a Houston businessman. And it has already been passed into law by Georgia, Oklahoma, Texas, and Missouri, with a push to have between 25 and 40 legislatures take up the issue in early 2012 before it is sent to Congress.
The four-page compact itself is unique. Most compacts involve states agreeing on how to solve multiple-state issues and offer reciprocal recognition of laws and licenses in other states, such as driver's licenses or insurance. The interstate compact, however, does not propose the creation of a permanent commission and staff like the Great Lakes Commission.