After a second attempt to gather votes for the failed Obamacare overhaul had the same result, the Trump administration pulled out an optimistic estimate of the effects of an amendment offered by Texas Senator Ted Cruz in another effort to persuade moderates to vote ‘yes.’
According to a Department of Health & Human Services (HHS) estimate, Cruz’s proposed amendment to the Senate’s Better Care Reconciliation Act would offer consumers cheaper plans and result in more people buying health insurance than under the current status quo.
A report in Bloomberg noted, “The plans would come with extremely high deductibles, according to the analysis, and might not cover some basic services.” However, “extremely high deductibles” are also the case with Obamacare plans, which are mandated to cover services that are not even needed by at least half of the population.
In a lunch hosted by the White House on Wednesday, Trump told senators that they should not leave Washington until they repeal and replace Obamacare. To that end, Senate Republicans are expected to meet this evening, according to Tennessee Republican Bob Corker.
Under the Cruz proposal, insurers would be permitted to sell plans that offered little in the way of maternity or prescription coverage to those who don’t need that sort of care. This will lower premiums, according to HHS analysis, which based its projections on the assumption that non-Obamacare compliant plans would have a $12,000 annual deductible.
According to the HHS, those likely to sign up for Obamacare-compliant Silver plans, presumably those who are considered high risk, would pay on average $380 per month in 2024, down from $845 per month projected under current law, according to a report in the Washington Examiner, which obtained a copy of the agency’s document.
“Consumers who purchase plans outside of the Obamacare mandates would save even more money by 2024 and would pay $240 per month on average,” and enrollment in the individual market would climb, according to HHS.
The report goes on to say, “Enrollment in health insurance under the individual market is expected to reach 13.9 million in 2024. Under the Consumer Freedom plan included in the Senate healthcare bill, 16.1 million would be enrolled by 2024. These numbers do not take into account Medicaid, which Obamacare expanded and the Senate healthcare bill would scale back.”
All consumers would be included in one risk pool, according to Cruz’s plan, which lost the support of Sen. Mike Lee, R-Utah. Lee co-authored the original plan, which would have created two insurance pools — one for high-risk consumers and another for everyone else. But the change was made in an effort to keep moderates happy, which reportedly made Lee back away.
HHS estimates that in 2020, between 14.8 million and 16.1 million people would be enrolled in the individual market under the Cruz plan. That compares with an estimated 14.8 million enrolled this year, according to the document.
The two main insurance-industry lobbying groups, America’s Health Insurance Plans and the BlueCross-BlueShield Association, gave a negative assessment of the Cruz proposal last week.
“It is simply unworkable in any form and would undermine protections for those with pre-existing medical conditions, increase premiums, and lead to widespread terminations of coverage for people currently enrolled in the individual market,” both groups said in a July 14 letter. “Millions of more individuals will become uninsured.”
Larry Levitt, senior vice president at the Kaiser Family Foundation, criticized the report in a series of tweets, saying that the government’s analysis was missing the boat on how consumers might react to changes in pricing, stating that it was “hard to evaluate without it.”
However, the Cruz plan got a thumbs-up from CNN commentator Stephen Moore, who called it “smart policy.”
“The Cruz amendment creates what is called a ‘Consumer Freedom Option.’ This essentially allows an ‘off-ramp’ from Obamacare for the tens of millions of Americans who don’t want it,” explained Moore. “The ‘Consumer Freedom Option’ allows insurers who offer Obamacare-compliant plans to offer a range of much less costly plans. In other words, it empowers people and families to pick and choose what they want in their own insurance package. Some families want and can afford blanket coverage that insures them for everything from cancer to contraceptives, and drug addiction to dental care and the sniffles. If you want to pay for that coverage, the option is yours.
It's pretty remarkable for a government analysis to say a key assumption — the elasticity — is "proprietary." Hard to evaluate without it. https://t.co/MLINatG1tY
— Larry Levitt (@larry_levitt) July 19, 2017
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