Republican Sens. Lindsey Graham (R-S.C.) and Bill Cassidy (R-La.) are leading a last-ditch effort to pass a conservative-friendly version of Obamacare, pushing a bill this week that allows states to waive key regulations that include protections for people with pre-existing conditions, a critical detail that has prevented previous versions of the legislation from passing.
But in its concessions to the GOP, the bill may have doomed itself to alienation from the left, as critics have quickly pointed to states’ ability to waive Obamacare regulations as the beginning of an erosion of citizens’ coverage.
“State waivers would effectively end important national standards for private coverage, taking away essential benefits from people with pre-existing conditions,” according to an analysis from the pro-Obamacare group, Families USA.
One statute defenders of Obamacare are wont to see waived is community rating, whereby insurers are required to charge everyone on the individual market the same rate regardless of health history.
Graham and Cassidy say there would still be regulations in place dictating states cover those with preexisting conditions and that block grants would encourage states to think outside the box in dealing with their own health care issues.
“We are trying to get as many approaches to helping sick people as there are out there,” Graham said at a press conference Wednesday. “Under Obamacare, the innovation is almost zero. Under our block grant approach, innovation is pretty wide.”
Furthermore, Cassidy said it would be in states’ best interest to insure people, as the more citizens they have insured the more money they get.
“At some point, the [block grant] amount that a state gets depends upon how many people they have insured,” he said. “If they have a fractured market in which people are not getting insured then they will get less money.”
Also, if a state wishes to waive community rating, they must tell the federal government “how they will ensure that individuals with pre-existing conditions have access to affordable and adequate coverage,” a Senate aide familiar with the legislation told the Washington Examiner.
The criteria for proving coverage is currently ambiguous.
But critics state that leaving community rating up to the states is the first step toward unaffordable rates for those with preexisting conditions.
“The bill would prohibit pre-existing condition exclusions, but the requirement would seem meaningless if insurers could charge unaffordable rates based on pre-existing conditions,” wrote Timothy Jost, an Obamacare supporter and law professor at Washington & Lee University, in a blog post for the journal, Health Affairs.
Jost notes that the addition of the waivers statute to the bill is more political than economic. Since the bill is of the reconciliation category it must reduce the deficit and include provisions only affecting budget or spending levels.
But the waivers bring up a key conflict that has bedeviled Republicans throughout their effort to repeal Obamacare.
The House experienced a similar issue that sought to address waivers after conservatives rebelled against an earlier version that left the law’s insurer regulations intact. An amendment authored by Rep. Tom MacArthur would have let insurers waive community rating and essential health benefits.
Republicans also added $23 billion in funding for high-risk pools, which subsidize high-cost enrollees on the individual market.
This was attractive to Freedom Caucus Republicans but alienated the center-right. Thus, the pendulum swings back and forth with each new version of the bill.
The CBO said that House bill was not sufficient and found that premiums for sick people in states that get a waiver would rise over time to the point where people couldn’t buy comprehensive insurance on the individual market.
Thus, the Graham-Cassidy bill will wait with bated breath for its CBO score, to see if it can make it to the Senate floor.
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