This Health Care Proposal is a Train-Wreck
Via the NYT, The G.O.P.’s High-Risk Strategy for Health Law Repeal:
Under the proposed House legislation, individuals would no longer be subject to a penalty if they go without health insurance, a politically popular change that would be retroactive to 2016. But they would still enjoy the protections of the Affordable Care Act: Insurers would have to offer a suite of essential health benefits, could not deny them coverage because of pre-existing conditions and could not impose annual or lifetime caps on coverage.
Insurers would be free to raise their premiums to meet these requirements, but because current policies are locked in for the year, voters would not see the effects until 2018. If young, healthy Americans flee the market, freed from the mandate, premiums could soar next year.
Insurers say this is a recipe for havoc. Eliminating the penalties used to enforce the mandate that most Americans have insurance “would add to short-term instability in the market,” said Marilyn B. Tavenner, the chief executive of America’s Health Insurance Plans, a lobby for insurers.
Instead of the current tax penalty for failing to secure coverage, the bill would introduce a penalty for purchasing insurance after letting coverage lapse: To encourage people to maintain “continuous coverage,” insurers would impose a 30 percent surcharge on premiums for people without coverage for 63 days or more.
So, this keeps some of the more expensive elements of the PPACA (e.g., pre-existing conditions), but removes the mechanisms that makes it a viable policy (i.e., the mandate). Plus, it keeps a penalty of sorts, but now as a revenue enhancement for insurers and does so in a way that will incentivize the young and healthy to forgo insurance.
I am more than happy to state that the PPACA is imperfect, but how anyone could support this train-wreck of an alternative is beyond me.
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