During a Facebook Live Q&A session on May 11, Senator Thom Tillis told North Carolinians that he is comfortable with letting states decide whether to protect people with pre-existing conditions from pricing discrimination. His rationale? No state would want to take up the American Health Care Act’s (AHCA) waivers from those protections.
Well, the experts at the Congressional Budget Office (CBO) disagree. According to the report released yesterday by Congress’ objective legislative impact scorekeeper, half of the U.S. population would live in states that waived the ban on charging people higher premiums based on health status (called “community rating”) and/or the requirement that plans cover minimum services, such as mental health and prescription drugs (called “essential health benefits”).
The CBO looks to states’ past behavior to predict whether they would take up a waiver from the essential health benefits requirement and the community rating protection. They “expect that states that previously mandated fewer benefits [be covered by health plans] would be more likely to apply for a waiver to modify the EHBs.”
Before the ACA, only 18 states mandated coverage of maternity care and only 23 states mandated some mental health benefit coverage. North Carolina was not among those states. Before the ACA, 18 states limited or prohibited pricing discrimination against people with pre-existing conditions. North Carolina was not among those states.
What’s more, the CBO expects that states with “fewer insurers” (North Carolina has one statewide insurer on the individual market) and “higher premiums” (North Carolina has the second-highest gross benchmark plan premium before subsidies in the country) would be those most likely to seek those waivers.
Here’s what the CBO says about what will happen in states that seek both waivers. Fair warning: it is shocking:
About one-sixth of the population resides in states that CBO and JCT expect would obtain waivers from EHB and community-rating requirements and make substantial changes to market regulations. Those changes would result in significantly lower premiums for those with low expected health care costs and higher nongroup enrollment by those individuals than under current law—and lower average premiums for such people than in states making moderate changes to regulations. However, over time, less healthy individuals (including those with preexisting or newly acquired medical conditions) would be unable to purchase comprehensive coverage with premiums close to those under current law and might not be able to purchase coverage at all.
They continue, noting that the return of medical underwriting (premium pricing based on health status and pre-existing conditions), would completely destabilize markets for people who need health care:
Eventually, CBO and JCT estimate, those premiums [for less healthy people or those with preexisting medical conditions] would be so high in some areas that the plans would have no enrollment. Such a market would be similar to the nongroup market before the enactment of the ACA, in which premiums were underwritten and plans often included high deductibles and limits on insurers’ payments and people with high expected medical costs were often unable to obtain coverage.
Sen. Tillis doesn’t seem to recognize the severe damage that the Republican health care bill would cause or the likelihood that its waivers will hit home here in North Carolina. Let’s hope that he and his colleagues in the Senate carefully read the CBO report.