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How Will The GOP Health Care Plan Affect Insurance Costs?


We're going to start this hour by talking about the Republican proposal to replace the Affordable Care Act, or Obamacare. In a moment, we'll hear from a group that has come out against the plan, the AARP.


But first, we'll hear about a few parts of the proposal as it stands now. One big element of the Republican plan would change how the ACA subsidizes work. It would be a one-time annual tax credit based more on age than on income.

SHAPIRO: Lynn Barton (ph) of Houston, Texas, is one of the people the proposal would affect.

LYNN BARTON: Prior to ACA, I couldn't get decent insurance.

SHAPIRO: Barton makes about $22,000 a year running a pet-sitting business. She also has Type 2 diabetes. Because she makes so little, under the Affordable Care Act, Lynn Barton gets $335 a month off her exchange insurance.

SIEGEL: Under the GOP proposal, Barton wouldn't get that subsidy on her monthly premium. Instead, she would receive a tax credit of $3,500 a year based on her age and income. That's not a huge difference, just about $500 total over the course of the whole year. But Barton says that's difference enough.

BARTON: That is not as good as what I'm getting now. So I really fail to see how this is going to save me money. I'm not seeing it.

SHAPIRO: The GOP proposal would save money for 24-year-old Cecelia Roeder. She lives in Arizona, where she works in marketing. Roeder isn't eligible for health insurance through her current job because she works part-time. But she says she can't really justify paying for a plan because she's young and healthy.

CECELIA ROEDER: I mean, I'd like some insurance. But it's not a major priority because I don't need it right now. I mean I'm healthy. You know, I don't require medication. You know, I'm not ill.

SIEGEL: To encourage healthy people to buy insurance, the Affordable Care Act has a mandate. People who don't have coverage like Cecelia Roeder are penalized. Last year, that penalty cost her $600.

ROEDER: I personally was affected by that. I couldn't afford health insurance. And having, you know, dollars taken out of my tax return when that was enacted and the penalty became active, that was frustrating because I was being, you know, penalized because I couldn't afford health care.

SIEGEL: Roeder says that's the one thing she likes about the GOP plan. There would be no penalties if you don't have insurance.

SHAPIRO: There are a number of things that wouldn't change under the Republican proposal. Insurers can't place a lifetime cap on coverage. People under 26 years old can stay on their parents' plan. And insurers must cover people regardless of any preexisting conditions. Transcript provided by NPR, Copyright NPR.