FOR IMMEDIATE RELEASE
July 6, 2017
Contact: Lenda Sherrell
After Authoring Repeal Bill That Guts Protections for Pre-Existing Conditions, Senate Republicans Consider Making It Worse
(NASHVILLE, TN) The current Senate Republican health care repeal bill already puts health insurance at risk for those with pre-existing conditions.
Now, to appease the far right wing in the Senate, Republican leaders are debating making it even worse.
In the House of Representatives, Republicans tried a gimmick to gut protections for people with pre-existing conditions by allowing states to opt out of them. The Senate Republicans promised they wouldn’t do that but are now pushing Ted Cruz’s plan that allows the insurance companies to opt out instead. Either way, the result is the same: people with pre-existing conditions who depend on their health care will lose these protections and pay more for worse coverage.
Here’s what the proposal would really mean:
THE CRUZ PROPOSAL WOULD GUT CONSUMER PROTECTIONS LIKE GETTING RID OF ANNUAL AND LIFETIME LIMITS
Sen. Susan Collins (R-ME): “It Would Lead To Adverse Selection In The Marketplace, And It Would Vitiate The Important Consumer Protection Of Having A Prohibition Against Annual And Lifetime Caps.” “‘It would lead to adverse selection in the marketplace, and it would vitiate the important consumer protection of having a prohibition against annual and lifetime caps,’ Senator Susan Collins of Maine said in an interview.” [Bloomberg, 6/29/17]
THE CRUZ PROPOSAL WOULD DESTABILIZE THE MARKETPLACE AND LEAD TO A DEATH SPIRAL
Larry Levitt, Senior Vice President, Kaiser Family Foundation: Cruz Plan “The Perfect Recipe For Destabilizing The Market And Turning The Marketplaces Into High-Risk Pools.” “‘If there were a Joy of Cooking for insurance, this would be the perfect recipe for destabilizing the market and turning the marketplaces into high-risk pools,’ said Larry Levitt, senior vice president at the Kaiser Family Foundation.” [CNN Money, 7/6/17]
Insurance Industry Official: “Insurers Are Concerned That Would Make It Challenging To Keep Premiums Low For Everyone.” “Insurance groups and policy experts warn, however, that this approach would create instability in the individual market by fragmenting the risk pool and driving up premiums for sicker people who need expensive care. They say it would turn the market for ACA-compliant plans into a de facto high-risk pool, but without an adequate, dedicated funding stream to make that model viable. ‘Insurers are concerned that would make it challenging to keep premiums low for everyone,’ said an insurance industry official who did not want to be named.” [Modern Healthcare, 6/30/17]
Craig Garthwaite, Health Insurance Expert, Northwestern University: “The Sick Would Be Attracted To Cheaper Plans, With The Knowledge They Could Always Move Into More Generous Plans If They Got Sick.” “‘The sick would be attracted to generous plans, while the healthy would be attracted to cheaper plans, with the knowledge they could always move into more generous plans if they got sick,’ said Craig Garthwaite, a health insurance expert at Northwestern University. ‘That kind of adverse selection makes pricing and offering insurance very hard.’” [Modern Healthcare, 6/30/17]
Vox: “The Fundamental Problem Is Sicker People Would Be Drawn To The More Robust Obamacare Plans, While Healthier People Would Gravitate Toward The Skimpier Non-Obamacare Coverage.” “The fundamental problem is sicker people would be drawn to the more robust Obamacare plans, while healthier people would gravitate toward the skimpier non-Obamacare coverage. That’s a reality that even Cruz acknowledges. Then inside the Obamacare market, as more and more sick people buy coverage there, costs for health insurers go up and so they increase premiums. It has the makings of a classic death spiral. Because only sick people remain, premiums eventually increase to astronomic levels. It turns the Obamacare exchanges into a high-risk pool.” [Vox, 6/29/17]
Vox: “The Whole Idea Is Dependent On An Effectively Unlimited Federal Commitment To Pay The Bills.” “So it becomes a question of the federal government’s willingness to pay that bill, indefinitely into the future. Otherwise, people with high medical costs could be stuck with a market that doesn’t function and isn’t adequately subsidized. The whole idea is dependent on an effectively unlimited federal commitment to pay the bills.” [Vox, 6/29/17]
Larry Levitt, Senior Vice President, Kaiser Family Foundation: “How Long Would Congress Allow The ACA Tax Credits To Stand As The Costs Increase Rapidly?” “‘The marketplaces would turn into de facto high-risk pools,’ Levitt said. ‘How long would Congress allow the ACA tax credits to stand as the costs increase rapidly?’” [Vox, 6/29/17]
THE CRUZ PROPOSAL WOULD RAISE COSTS FOR PEOPLE WITH PRE-EXISTING CONDITIONS
Ceci Connolly, CEO, Alliance Of Community Health Plans: “You Are Increasing The Likelihood That There Will Be Some Smaller, Sicker Group With Higher Rates.” “Separating the sick and the healthy is ‘not the best path forward,’ said Ceci Connolly, CEO of Alliance of Community Health Plans, a lobbying group for non-profit, community-based insurers. Instead, it’s better to spread the risk around in a larger pools of enrollees. The Cruz option would do the opposite. ‘You are increasing the likelihood that there will be some smaller, sicker group with higher rates,’ Connolly said. ‘That’s what you want to get away from.’” [CNN Money, 7/6/17]
Larry Levitt, Senior Vice President, Kaiser Family Foundation: “If They Have Pre-Existing Conditions, They’d Be Stuck In Plans With Escalating Premiums.” “Americans with higher incomes who wanted to buy an Obamacare-compliant plan, people likely to have high medical costs themselves, would have no protection from skyrocketing premiums. ‘If they’re healthy, they could buy inexpensive non-compliant plans. But if they have pre-existing conditions, they’d be stuck in plans with escalating premiums,’ Levitt said.” [Vox, 6/29/17]
Tim Jost, Law Professor, Washington And Lee University: “If This Were Adopted, Premiums Would Skyrocket For People Who Need Comprehensive Coverage.” “Health analysts said the amendment would cause premiums for that demographic to jump, resurrecting a thorny political issue that drew national attention earlier this year when House Republicans added a similar measure to their bill, known as the MacArthur amendment. ‘If this were adopted, premiums would skyrocket for people who need comprehensive coverage,’ said Timothy Jost, a law professor at Washington and Lee University in Lexington, Va.” [Wall Street Journal, 7/5/17]
Wall Street Journal: “Middle-Income Earners With Pre-Existing Conditions Would Be The Hardest Hit.” “Such a bifurcation likely would mean increased costs for comprehensive plans, analysts said. People receiving the bill’s tax credits would be buffered from the price increases, but those who earn 350% of the poverty level and wouldn’t be eligible for the credits would pay more, they said. Middle-income earners with pre-existing conditions would be the hardest hit.” [Wall Street Journal, 7/5/17]
Larry Levitt, Senior Vice President, Kaiser Family Foundation: Getting Premiums Down “Comes Down To Relaxing Rules That Protect People With Pre-Existing Conditions.” “‘When it gets to crunchtime on these health bills, the discussion comes down to getting premiums down,’ said Larry Levitt, a senior vice president at Kaiser Family Foundation. ‘And that comes down to relaxing rules that protect people with pre-existing conditions.’” [Wall Street Journal, 7/5/17]