An Obamacare replacement that works

An Obamacare replacement that works

Tom Price, the chairman of the House Budget Committee, is the latest Republican to unveil a conservative health-care plan to replace Obamacare. It’s a good plan, although it could be made better — and it helps to clarify some of the trade-offs involved in health policy.

Price’s plan would give people tax credits to buy health insurance. The credits would be based on age but not on income. Everyone between 35 and 50 would get $2,100 a year, for example. Both the Affordable Care Act and some other conservative health-care bills, such as the one proposed by Senator Orrin Hatch and colleagues, instead phase out tax credits with income. The credits could be used to buy insurance in a much less regulated market than Obamacare creates: No longer would insurance policies have to cover a federally approved list of essential health benefits, for example.

The plan has already elicited some reasonable criticism over the choices Price made. If you offer the same tax credit regardless of income, you send money to people who don’t need it. On the other hand, you relieve the administrative difficulty and unpredictability of an income-based credit. A lot of people don’t know how much help they can count on from Obamacare; they would have more certainty with Price’s plan.

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