Mitch McConnell admitted defeat earlier this week when he postponed the vote on the Senate’s version of the American Health Care Act. Rand Paul’s conservative coalition announced they wouldn’t be voting for it which ensured the legislation wouldn’t pass. Now that the battle has been won, the Kentucky Senator announced plans to win the war. Rand Paul released a set of proposals that would gut the existing bill and replace the subsidies with free market solutions.
1. Association Health Plans – While I appreciate the inclusion of Small Business Health Plans in the BCRA, I believe improvements could be made to expand upon this provision to allow for greater freedom for individuals and small businesses to pool together for the purpose of obtaining health insurance coverage.
a. The bill currently allows for self-employed individuals to participate in small business health plans. However, I would suggest that the language be changed to allow any individual, including self-employed individuals, to form associations for the purpose of purchasing group health insurance.
b. Furthermore, I would suggest that small business plans or association health plans be allowed to self-insure like other large employer groups are able to do under ERISA. Self-insurance provides significant flexibilities to create innovative plan designs free from many mandates.
c. Finally, I believe we have an opportunity to completely free the group market from unnecessary ACA regulations, and restore HIPAA and ERISA regulation over the entire group market, including for association health plans.
2. Insurance Company Bailouts – For years, conservatives have been concerned with Obamacare’s bailout of the insurance companies through various programs designed to backfill losses the insurers take in the Obamacare exchanges, while they make huge profits in the group markets. In fact, insurance company profits were $8 billion per year in 2008, and have risen to $15 billion in 2015. The BCRA’s payment of Obamacare’s cost-sharing reductions, as well as its stability funds, would provide another $136 billion in funding to pay insurance companies to participate in these markets. I urge you to reconsider this insurance company bailout.
3. Premium Tax Credits – In 2015, Senate Republicans voted to eliminate the Obamacare premium tax credits. Now, the BCRA simply proposes to modify and extend them to new populations. I urge you to reconsider the advanced, refundable nature of this entitlement.
4. Continuous Coverage Requirement – The continuous coverage requirement of the BCRA, which imposes a mandatory 6 month waiting period for individuals with a lapse of 63 days or more in coverage, simply appears to be a Republican version of the individual mandate. This continues the top-down approach that has led to increased premiums and has not changed behavior of the young and healthy who are priced out of the market, and those who game the system to purchase insurance after they become sick. I urge you to remove the mandate and simply allow insurance companies to impose a waiting period.
Mitch McConnell will have to add a few of these ideas to the current legislation if he wants to earn Rand Paul’s vote. Without the inclusion of any of these measures, the Better Care Reconciliation Act of 2017 is guaranteed the same fate when lawmakers return from their 4th of July break.