Ron Paul: Introducing the Private Option Health Care Act

Date: 05/31/2010

Introducing the Private Option Health Care Act

by Ron Paul

Most everyone agrees that health care in the United States has major problems, the biggest problems relating to skyrocketing costs. No one doubts the system is in need of reform. However, too many in Washington see tighter government controls as the solution. In fact, the problems are rooted in past government controls that created more problems than they solved.

Ironically, laws and policies in the 1970s promoting Health Maintenance Organizations (HMOs) resulted from desperate attempts to control spiraling costs. However, instead of promoting an efficient health care system, HMOs took far too much control away from patients and physicians and gave it to the insurers. This excessive reliance on third-party payers instead removed incentives for insured patients to economize on health care costs, and allowed the problem to snowball. Furthermore, the third-party payer system created a two-tier health care system where people whose employers could afford to offer “Cadillac” plans have access to top quality health care, while others face financial obstacles in obtaining quality health care.

For these and other reasons, I introduced the Private Option Health Care Act last week. This bill places individuals back in control of health care by replacing the recently passed tax-spend-and-regulate health care law with reforms designed to restore a free market health care system.

First, the bill would provide all Americans with a tax credit for 100% of health care expenses. This tax credit is fully refundable against both income and payroll taxes. It would also allow individuals to roll over unused amounts in cafeteria plans and Flexible Savings Accounts (FSAs). Next, it would provide a tax credit for premiums for high-deductible insurance policies connected with a Health Savings Account (HSAs) and allow seniors to use funds in HSAs to pay for medigap policies. In addition, it would repeal the 7.5% threshold for the deduction of medical expenses, and thus would make all medical expenses tax deductible.

This bill would also create a competitive market in health insurance by exercising Congress’s Constitutional authority under the Commerce Clause to allow individuals to purchase health insurance across state lines. Ending these state-imposed bans would create a competitive national marketplace in health insurance.

The Private Option Health Care Act would also ensure that people harmed during medical treatment receive fair compensation while simultaneously reducing the burden of costly malpractice litigation on the health care system. The bill achieves this by providing a tax credit for negative outcomes insurance purchased before medical treatment. This type of insurance would provide compensation for any negative outcomes without having to go through lengthy litigation or giving huge sums to trial lawyers.

Finally, the Private Option Health Care Act would lower the prices of prescription drugs by reducing barriers to the importation of Food and Drug Administration (FDA)-approved pharmaceuticals. Under my bill, anyone wishing to import a drug simply submits an application to the FDA, which then must approve it unless it is either not approved for use in the United States or is adulterated or misbranded.

The Private Option Health Care Act allows Congress to correct the mistake it made last month by replacing the new health care law with health care measures that give control to individuals, instead of the federal government and corporations. Our health is too vital to allow for the typical results of government interference and “fixes”.


  • Jay

    I like the idea. It has a lot of components that makes sense. But I think its unfinished. Tax credits are nice, but if you cant afford health insurance anyways it does you no good.

    Here’s my idea,

    Along with what has already been proposed, why doesn’t the gov’t $4,0000 put into a health savings account (more for a family) if the person agrees to pay an optional 10% tax. That way, for people making less than $40,000, it would make sense to do it but not for those making above $40,000. It would cost money for sure, but you could offset the cost if you reduce/eliminate the wasteful medicaid program.

  • Way the go Ron! EXCELLENT!

  • Libertarian777

    one thing he forgot in this bill, is to remove the “use it or lose it” provision in the FSA plans. Everyone should be able to have a HSA type plan instead (tax deductible health savings account that doesn’t ‘expire’ annually, something like a 401(k)).

  • 1shabuti1

    God bless the Paul family. I love this man like a father.

  • FumingPoliticalPunk

    Paul rules.

    • fred the protectionist

      Only in your imagination.

      • EndtheFed

        Fred has the most active imagination here.

        He even came up with his own version of economics. It’s void of logic and reason, and it changes to suit his argument at will.

        • fred the protectionist

          You neocons and Libertarians are the ones living in a dream world.

          Well here’s your wonderful service economy in this free-trade/open-borders world you neocon/Libertarians started in the 1990’s. Idn’t it wonderful. Enjoy. Inhale deep, and smell the wonderful world you created.

        • EndtheFed

          Hmmm… That’s funny, I don’t remember libertarians being in power during the 90s.

          Are you sure you weren’t dreaming?

  • steve0281

    The only man in government that speaks for me.

  • John Trent

    This should really increase your contributions from the health insurance industry Ron. Why don’t you take some time and represent the PEOPLE!

    • Ryan

      John, I am a disabled individual whom currently has thousands of dollars in medical bills which I can’t afford, and I agree with Ron Paul.
      You misunderstand his position. Ron argues, as I do, that cost reduction of medical expenses should be the primary focus in debate. As well as reducing the government regulations which contribute to the higher costs. The current plan is simply to mandate forcefully, under threat of fines, for people to buy what they can’t afford. They’ve proposed nothing, absolutely nothing, in way of reducing the costs, and therefore the burdens on the people. The Liberal plan is an elitists dream come true.
      What We The People need is to get costs down to rational and fair levels that people can afford. Our medical costs are far and away higher than any other nation on planet Earth. They do not need to be that high. There are many ways to reduce the cost without lowering our high standards of medical care. But the Corporatists are running the debate. They are not interested in any plan that lessens their profit margin, even if that costs people their lives. And the plan is, and has been, killing people for years. The only way to solve the problem is to get costs inline with the people’s income. The government run plan will not do this. Quite the contrary, it will only increase the costs to the people.
      Like Ron Paul, I argue that government rules and regulations are the worst enemy of the people on this issue. And more government control is the last thing we need. It is what caused the costs to spiral out of control to begin with. It will only get worse if we have a government run program. A free market system with less government interference and regulation will get cost down adequately so that the people can afford to fund their own health care.
      I suggest you re-read and re-consider what Ron is saying. And reassess what the Elitist-Liberal plan will actually accomplish, and whom is actually benefits. Their plan does not help The People, it burdens them even more than the current system/costs do right now.

  • terrygus1

    Ron your the best—-your in the lead in all the polls in my book.

  • marieatthelake

    Go to YouTube dot com for interviews with Gerald Celente, Bob Chapman, Adrian Salbuchi, Marc Faber, Jim Rogers and Schiff from CT. Some are short. Some are long. All are informative.

  • Cloudy2Clear

    A very feasible option, Mr Paul. Kudos.

  • KingRyltar

    sounds good Congressman

  • theoriginalanomaly

    This is huge if you can get it going.

  • kixdirtsevin

    don’t he ever get sick of being right ?

  • Munkatten

    If I was american, I would vote for ron paul just because he isn’t bought, even though I think he’s completely wrong on most things. From the outside, the american government looks completely corrupt :/.

    • B.D.Harper

      Looks that way from the inside too.

  • BloodiCheeseCake

    The problem with our healthcare debate is that we argue whether corporations or government should manage our health. But why hasn’t anyone asked if patients can manage their own health? Most people never ask the bigger questions.

    Ron Paul has got it right.

  • korzym
  • captkirkconnell

    RON PAUL knows the Truth and is brave enough to speak it

  • danbowski40

    Ron Paul 2012 Baby!!!

  • skizzle42

    love your updates each week thanks

  • MrSleeps

    i hope this passes it would a hell of a lot better then what they are trying to force me to do, which is totally wrong to make someone do something like that here in america, so unconsitiutional.