Republicans do not want the country to know what is in their health care bill.

[GMDino]

https://www.wsj.com/articles/insurers-oppose-cruz-amendment-to-republican-health-care-bill-1500087886

Quote:Insurers Oppose Cruz Amendment to Republican Health-Care Bill
Provision would allow insurers to sell plans that aren’t compliant with Affordable Care Act




Sen. Ted Cruz (R., Texas) said the amendment is essential to his support of the Republican health-care bill.  PHOTO: BILL CLARK/ZUMA PRESS

Insurers are ramping up their opposition to a new amendment in the Senate Republican health bill that would allow them to sell plans that don’t meet Affordable Care Act requirements, an effort that could add to the challenges faced by GOP leaders trying to shepherd the legislation.

The provision, backed by Texas Sen. Ted Cruz, would authorize insurers to sell coverage that wouldn’t meet ACA standards on the condition that they also sell at least some plans that did. While this setup could offer healthy people less expensive policies, insurers and actuaries say it would likely prove dysfunctional over time, pushing up rates and reducing offerings for people buying the compliant plans.
In a letter sent Friday night to the Senate Republican and Democratic leadership, the two major associations representing health insurers, which don’t typically send such missives jointly, said the amendment “is simply unworkable in any form and would undermine protections for those with pre-existing medical conditions, increase premiums and lead to widespread terminations of coverage for people currently enrolled in the individual market.”

The fate of the bill is on a knife-edge. Two Republican Senators have already said they oppose it, and Senate Majority Leader Mitch McConnell (R., Ky.) cannot afford to lose any more Republicans to get the 50-vote majority the legislation needs to pass. Vice President Mike Pence would break any tie. No Democrats are expected to support the GOP bill.

The letter from America’s Health Insurance Plans and the Blue Cross Blue Shield Association may alarm moderate Republican senators who have pledged to protect coverage for people with pre-existing medical conditions. But on the other side, the provision’s inclusion has been vital in winning over Sen. Cruz, and it is supported by other conservatives, though some feel it doesn’t go far enough to wall off the healthier market from the sicker consumers’ costs.

In an interview, Sen. Cruz said the provision is essential to his support of the bill. He said his amendment “takes nothing away” and would help millions of people by allowing them to buy lower-cost coverage, including with pretax dollars from health savings accounts, which in turn would boost insurance pools overall.



The noncompliant plans sold under the Cruz amendment could be more limited than today’s ACA coverage, lacking benefits such as maternity care, and could feature higher out-of-pocket costs and potentially annual or lifetime limits on coverage, said  Larry Levitt, a senior vice president at the Kaiser Family Foundation.

Also, insurers could refuse to sell these noncompliant plans to unhealthy people, or they could charge enrollees higher premiums based on their health conditions, according to Mr. Levitt.

The upshot, experts say: The noncompliant plans would likely be far less expensive and would draw healthy enrollees away from the compliant plans. That could leave the compliant plans with a sicker customer pool that generates higher medical costs on average, pushing up premiums.

“There are certainly winners and losers with this program,” said Kurt Wrobel, a fellow of the Society of Actuaries and chief actuary at Geisinger Health Plan. “Individuals that were healthier and not getting a subsidy in some respects would be better off, those with pre-existing conditions would be made worse off.”

In their letter, the insurance associations said that if the amendment becomes law, “premiums will skyrocket for people with pre-existing conditions.” The provision “will lead to far fewer, if any, coverage options for consumers who purchase their plan in the individual market.
As a result, millions of more individuals will become uninsured,” the associations said.

The bill contains some mechanisms designed to avoid this outcome. It adds billions of dollars in stabilization funds that could help hold down premiums for those buying ACA-compliant plans. Also, to access federal premium assistance under the Senate bill, consumers would need to purchase the compliant coverage, which could keep lower-income, healthy people in the mix.

The insurers’ letter said the funding is “insufficient and additional funding will not make the provision workable for consumers or taxpayers.”

Defenders of the Cruz amendment have noted that it does keep the compliant and noncompliant plans in the same risk pool, meaning that their pricing is supposed to be linked.

However, the amendment disables an important mechanism for ensuring that link is meaningful, insurers say. Under the ACA, a program called “risk adjustment” forces insurers that enroll a lot of healthy people to pay out money to competitors with sicker, costlier enrollees. That program won’t include the new noncompliant plans offered under the Cruz amendment.

“All the language that says there is a single risk pool is meaningless,” said Raj Bal,  an insurance-industry consultant. “You’ll have two pools.”

Actuaries and insurers say insurance companies would have an incentive to cherry pick—to offer a few expensive, unappealing plans that complied with ACA rules, aiming to attract few enrollees, and to focus instead on the skinny plans that could draw healthy people, which are likely to be more profitable.

“It’s difficult when you’ve got two sets of rules, and you’ve got an uneven playing field where you can’t compete against that cherry picking,” said Justine Handelman, a senior vice president at the Blue Cross insurer group. Some insurers “may be forced to pull out of the market.…You could see widespread terminations.”