WASHINGTON: Former US Vice President Joe Biden, the front-runner in the Democratic presidential race, unveiled a healthcare plan on Monday estimated to cost US$750 billion and paid for partly by higher tax rates for the wealthy and doubled tax rates on capital gains.
“The Biden plan to protect and build on the Affordable Care Act” seeks to strengthen the signature healthcare plan, popularly known as Obamacare, enacted under former Democratic President Barack Obama. Biden was Obama’s vice president for eight years.
Biden’s plan does not embrace a “Medicare for All” approach favoured by some of his Democratic rivals in the contest to face Republican President Donald Trump in the 2020 election.
But it would allow a public option in which people could enrol in a paid government healthcare plan, which would exist alongside private insurance.
The debate over the future of the US healthcare system has become a focal point of the Democratic presidential nominating contest. Some Democrats have been making big promises on healthcare, vowing sweeping overhauls and complete government takeovers.
Trump has sought to scrap Obamacare, but Republicans in Congress failed to overturn it. The law currently faces another court challenge.
A senior Biden campaign official who briefed reporters on Sunday estimated the cost of Biden’s plan to be US$750 billion over 10 years.
“As president, Biden will roll back the Trump tax cuts for the wealthy and return the top rate to 39.6%,” the senior campaign official said during a call with reporters. The top income tax rate is currently 37%.
In addition, Biden’s plan calls for people earning over US$1 million a year to pay double the tax they now pay on long-term gains made in the stock market. That rate is currently 20% for the highest earners.
Biden’s plan would increase the value of tax credits received by people who use the plan, a move designed to help them lower their premiums.
In addition, Biden would seek to repeal the existing law that prohibits Medicare, the government healthcare plan for seniors, from negotiating lower prices with drug companies.
On Thursday, the Trump administration scrapped a proposal to lower prescription medicine prices. The policy would have required health insurers to pass on billions of dollars in rebates they receive from drugmakers to Medicare patients.
Current policy allows companies like Cigna Corp and CVS Health Corp, which negotiate rebates with drugmakers on behalf of the Medicare program, to benefit from those discounts.
Biden’s plan would also limit price increases for all brand-name, biotech and “abusively priced” generic drugs to inflation and allow consumers to buy prescription drugs from other countries.
In the coming months, Biden campaign officials said the candidate would roll out proposals to combat gun violence and other public health issues including cancer and Alzheimer’s disease.