From the Deskof Bob McNett…..
What looked like a dead issue just last week has found new life as the GOP Senate voted to begin debate of their health care bill.
Under continuous pressure by President Trump and his administration, and fearful of the consequences in the upcoming elections if they do not pass a bill, Republicans “bit the bullet†Tuesday on a “motion to proceed.†To show how divisive the issue is, the motion passed 51-50, with Senator McCain coming back after brain surgery and VP Pence providing the final vote. No Democrats voted for the bill.
This does not mean that an actual bill is poised to become law. There are as many opinions as to what a bill should look like as there are Senators and House members in Washington.
The first amendment to be introduced was one sponsored by Senator Ted Cruz that would allow insurers to offer lower-benefit, lower premium plans that avoid many of the Obamacare coverage mandates. The fear is that by siphoning off healthy people, who may choose lower-priced coverage, it would increase premiums on those less healthy that may want to purchase more comprehensive plans. The amendment failed 43-57. There will be many amendments introduced as the bill moves along.
What needs to be done to cure the individual health insurance market is not clear. It is evident, however, that something needs to be done as this market continues to deteriorate across the country.
Here are some the immediate, critical problems we face:
#1—Individual health insurance premiums in Oklahoma increased an average of 76 percent just this year. Since 2013, premiums in Oklahoma have increased an average of 201 percent. Similar situations exist nationwide.
#2—Oklahoma is one of five states to have only one insurer offering policies on the exchange….Blue Cross. At least 44 counties across the nation are projected to have no exchange insurer in 2018.
#3—Even though employer-sponsored group health plans, where most American access their coverage, have been less affected by Obamacare rules, the law created regulations and taxes that have put additional pricing pressures on these plans as well. Some employers have adopted less comprehensive coverage to compensate for premium increases. This is a difficult move for employers needing to stay competitive in a nearly fully employed job market. Many more employers have just decided to increase their contribution for employees’ premiums.
#4—Because of loose enforcement by government administrators, many people have reported falsely that they have lost a job, their employer dropped coverage, got a divorce, etc., which constitutes a Special Enrollment Period (SEP.) People can enroll outside of the regular Open Enrollment Period (starting in November through January) if they lose coverage. The government has not been requiring proof of the circumstances allowing a SEP, so it makes it easy for folks to lie about their status, buy coverage, then drop it when their treatment is complete. This causes a death spiral of the insurance system.
#5—Many healthy people have decided they would rather pay the tax penalty than buy insurance. For 2015, 19.2 million people either paid the penalty or or claimed one of the various exemptions from the mandate. Any insurance pool has to have a mix of various ages, genders and health statuses to succeed. This coverage mandate, enforced by a tax penalty, has not been nearly as successful as hoped.
It will be interesting to observe as this bill moves through the Senate, and then, hopefully goes back to the house for further consideration. What kind of law will we end up with? Right now, it is anybody’s guess.
Robert K. McNett, LUTC
The McNett Agency
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