Latest 'repeal and replace' proposal gives more control to states

The dream of a world without Obamacare is not dead, at least not for a group of conservative advocates who on Tuesday released another proposal to repeal and replace the Affordable Care Act.

“The Health Care Choice Proposal,” which is backed by the Heritage Foundation and two dozen conservative policy analysts, would reallocate federal funding for the health law into block grants that would be doled out to the states, which would have broad discretion over the money’s use.

Related: The road to ACA repeal and replace

The proposal targets two major pots of money. First, there are federal subsidies that reduce the cost of health insurance for the great majority of those who have purchased plans through the ACA exchange. Second is the money from the ACA Medicaid expansion, which offers free or near-free coverage to those with incomes up to 133 percent of the federal poverty line.

While states would be free to use the money in a number of different ways, they would be required to direct at least half to helping people afford private insurance and at least half would have to be directed at providing coverage to low-income people.

Republicans considered but ultimately ditched a similar measure last September after it became clear that it lacked the 50 votes needed to get through the Senate.

Three months later, an upset victory by Democrats for an open Senate seat in Alabama reduced the GOP majority in the Senate to 51-49, further reducing the prospects of an ACA repeal bill passing.

While Republicans have failed to fully repeal the ACA, they have managed to push through a number of changes to health care law aimed at undermining the landmark health law. Notably, a tax bill that President Donald Trump signed into law in December repealed the requirement that individuals have health insurance or pay a fine.

On Tuesday, the Trump administration unveiled new rules that will allow small businesses and trade associations to purchase health insurance plans for employees or members that do not comply with many of the ACA’s rules. Trump framed the new rules as a way for small businesses to get cheaper plans, while Democrats said the policy would lead to poor coverage for employees and a further erosion of the ACA market.

Not all conservatives are on board with the new proposal.

“This plan keeps most if not all of Obamacare’s spending, most if not all of Obamacare’s taxes, and the regulations that Heritage’s own research indicate are the prime drivers of premium increases under Obamacare,” Chris Jacobs, founder and CEO of Juniper Research Group, a conservative consulting firm, tells the Wall Street Journal. “That’s not freedom, that’s not flexibility, and that’s not federalism.”

It’s also unclear whether Congressional GOP leaders want to revive the fight in what they anticipate to be a tough election year for Republicans.

Democrats and liberal groups denounced the new proposal as another attempt to sabotage a policy that they credit with expanding health care coverage to millions.