Insurers do not like Ted Cruz's health care plan


Insurers do not like Ted Cruz's health care plan

A huge deductible? Coverage for only one night of hospitalization? Ted Cruz would destabilize and fracture the individual insurance market.

A health care proposal from Senate conservatives would let insurers sell skimpy policies provided they also offer a comprehensive plan. Sometimes coverage benefits will be provided only if an insured person is admitted to hospital for a condition or on confirmation of a physician's diagnosis with pathology report.

It may sound good in theory - free markets and freedom of choice - and it's an idea that has always been popular with conservatives. So in order to make up for that, the insurance company increases premiums on the Obamacare-compliant plan.

But, she added, "From an insurance perspective, and from a consumer protection perspective, it wouldn't work". The two groups released it late Friday in the form of a letter to McConnell, R-Ky.

"It is unworkable in any form and would undermine protections for those with significant medical conditions, increase premiums and could lead to widespread loss of coverage for people now enrolled in the individual market", wrote the main industry trade group, America's Health Insurance Plans, and the Blue Cross Blue Shield Association.

Poorer individuals choosing an Obamacare plan would still be eligible for subsidies. "As a result, millions of more individuals will become uninsured".

However, health care experts say Cruz's plan could hurt Obamacare's most popular provisions - a requirement that people with pre-existing conditions can get health coverage. Leaving aside myriad complexities of insurance markets, ideally it balances out.

Realizing he'd made no friends and claimed no legislative achievements in his first four years in the Senate, Cruz decided this year he'd shed his image as an obstructionist grandstander and adopt the pose of a diligent dealmaker on health care, the issue he used to stage a government shutdown in 2013.

Meanwhile, everyone else who receives insurance through the workplace or can afford to purchase robust coverage continues in a de facto separate system.

Conservatives were hailing a proposed change to the Senate health care bill by Texas Republican Sen. Mark Kirk who's no longer in the Senate.

Although the Cruz/Lee amendment is dubbed the "consumer freedom option," Pollitz said the title is misleading.

Facing a brand-new market, insurers initially set their premiums far too low (and much lower than the Congressional Budget Office forecast). It openly treats these subsidies as government welfare and therefore is more honest while preserving a true, rational market alternative at a reasonable cost for the remaining great majority of the population. "All that money is fungible". The mandate was not part of the text of the ACA but part of its enforcement: under the law, insurance plans were required to cover all preventive services, which the Obama administration determined to include a range of contraception drugs and devices. Will people with serious illnesses and low enough incomes to qualify for Medicaid now be looking at plans with $5,000 deductibles?

This creates a kind of sorting, where younger, healthy people get the cheap plans and sick people get the more comprehensive, expensive plans. But there is zero reason to expect premiums to need to rise more.

"My real concern is, if the ACA is done away with, there will be people in this world like Roy who will die", she said.

But if it does, you better know what it is all about.

"After all of these years of suffering thru Obamacare, Republican Senators must come through as they have promised!" he wrote.

Cruz has fully embraced the narrower goal.

That might not sound like much, but it has the potential to drive down premiums and re-shape individual health insurance markets across the country, which right now are collapsing under the weight of Obamacare regulations and rising premiums. "If the cost of premiums continues to skyrocket, as they have under the last seven years under Obamacare, than we will have failed".