Slowly, but surely, Republicans are crafting an escape from ObamaCare.
The repeal of the Individual Mandate and the relaxation of regulations initiated by the Obama administration regarding short-term, limited duration insurance plans (STDLI), has rearranged the deck chairs on this sinking healthcare system.
Phil Gramm, former Senator from Texas and now visiting scholar at the American Enterprise Institute, says now is the time to complete the escape from ObamaCare. To make this possible, he says two things are needed:
- HHS should grant waivers to states that want to let private insurers offer state-approved plans that are exempt from ObamaCare coverage mandates. This will enable these states to expand healthcare freedom within their borders.
- Congress should amend ObamaCare to permit insurers to sell individual policies outside of the exchanges that are totally independent of ObamaCare regulations.
These two steps would dramatically increase the options available to all Americans. Those who benefit from ObamaCare now could continue within the system. Most of these are getting federal subsidies to purchase their otherwise exorbitant policies.
The rest of the country could purchase the newly available policies that would sell at about one-third the cost of ObamaCare policies.
The Idaho Test
The State of Idaho has stepped to the plate to take on these regulations. It is the first state to allow plans that stray from ObamaCare’s coverage mandates. Blue Cross of Idaho has proposed five “Freedom Blue” plans outside the state’s exchanges. The plans proved coverage similar to what is available on the exchanges – but at about one-third the price. That’s because these plans use actuarial analysis in pricing the policies rather than the ObamaCare methods that use “community rating” and “guaranteed issue.” Those methods artificially drive up the prices, especially for the young and healthy.
Gramm suggests Idaho make these state-approved plans renewable every 12 months. This would allow them to qualify for the STDLI exemptions recently implemented by the Trump administration.
Naturally, Democrats see this effort by Idaho as a threat to the long-term survival of ObamaCare – and they can’t let that happen. Senators Patty Murray and Ron Wyden have joined forces with Rep. Frank Pallone and Richard Neal to try intimidation of the State of Idaho. They have threatened massive fines and demanded emails and phone records but thus far Idaho hasn’t flinched. If Idaho succeeds, numerous Republican-led state legislatures are sure to follow.
The Impact on ObamaCare
The impact of this movement by state legislatures will be to turn the ObamaCare exchanges into a large high-risk pool. Democrats will try to get Congress to approve higher subsidies for the exchanges because premiums will have to rise to account for the loss of more young and healthy Americans. It will be impossible for Democrats to deny people who have voluntarily fled the exchanges the freedom to buy cheaper policies independent of ObamaCare regulations. That should provoke a healthy discussion about the best ways to fund high-risk pools – either by states or the federal government.
The Congressional Budget Office has projected only 7.4 million Americans still enrolled in ObamaCare by 2021. That’s only 2.2% of the population. These numbers were estimated after the elimination of the Individual Mandate but before the recent changes to STDLI plans implemented by the Trump administration.
The rest of the country will enjoy the newly found freedom to purchase the insurance plan of their choice at a price based on actuarial analysis – not one artificially raised by ObamaCare regulations. The freedom and savings enjoyed by most Americans should end any more discussion about single-payer healthcare (socialized medicine) in the future.