- REUTERS/Charles Mostoller
Republicans in the Senate are set to release an update of their healthcare bill as they work to find a way to repeal and replace the Affordable Care Act.
One attempt to attract conservative holdouts to the new version of the Better Care Reconciliation Act will be the addition of a provision introduced by Sen. Ted Cruz and supported by fellow Republican Sen. Mike Lee.
The amendment would allow insurers to provide plans that do not comply with two major regulations of the ACA: community rating and essential health benefits. Cruz and Lee have pushed it as a way to bring down premiums and open up choice in the individual market.
According to reports from Politico and Axios, the newest version of the bill will include the plan when it is released Thursday. The reports also suggest the language will be in brackets, meaning it is subject to further edits.
But the plan drew backlash Wednesday from an influential group of insurers worried about the potential effects of such a provision on people with preexisting conditions. According to these groups, it could make more robust coverage that sick people need prohibitively expensive and possibly force some of the sickest out of the market altogether.
But an analysis by the Kaiser Family Foundation, a nonpartisan health-policy think tank, said the amendment could cause the cost of plans that complied with those regulations to skyrocket, as only those who were sick and needed the more generous coverage would buy them.
“The ACA-compliant plans would effectively become a high-risk pool, attracting enrollees when they need costly health benefits – such as maternity care, or drugs to treat cancer or HIV, or therapies to treat mental health and substance abuse disorders – and those with pre-existing conditions who are turned down by non-compliant plans or charged high premiums based on their health. By contrast, non-compliant plans would attract healthier consumers, at least as long as they didn’t need coverage for such benefits. Premiums from the healthier enrollees would not be pooled to help keep the price of compliant plans affordable.”
Based on the number of people with preexisting conditions who were subject to rejection by insurers before the ACA, that could leave as many as 1.5 million people in the nongroup market with prohibitively expensive plans, according to the analysis by Kaiser.
The provision also drew a rebuke from American Health Insurance Plans, a lobbying organization that represents some of the US’s largest insurers. The AHIP said the Cruz proposal would create “an un-level playing field” and “unstable health insurance markets.”
“This is particularly true for patients with preexisting conditions – who would be most affected and potentially lose access to comprehensive coverage and/or have plans that were far more expensive, as premiums in the Exchange market would rise much faster than under existing market conditions and insurance options dwindle,” the group said in a statement Wednesday.
The Cruz provision could eventually be stripped out for political reasons or because it does not qualify under the Senate’s rules. The BCRA is being advanced through a process known as budget reconciliation, which allows Republicans to avoid a filibuster from Democrats but means everything in the bill must affect the federal budget deficit. If the Cruz addition does not qualify, per the Senate rulekeeper, it would be removed.
Republican Sen. Chuck Grassley of Iowa said the amendment was a “subterfuge to get around pre-existing conditions,” and other moderates have said they will not support a bill that includes the idea.
At the same time, Cruz and Lee have suggested they will not support the legislation if the idea is dropped, a potentially crippling blow to its chances of passage.