Friday, March 31, 2017

Lamar Alexander proposes Obamacare patch

Senator Lamar Alexander has proposed a common sense piece of legislation that would provide a temporary fix to Obamacare for those who live in areas where there are no insurers selling policies on the Obamacare exchanges. The proposed legislative would do two things. First, it would let people who get subsidies use that subsidy to purchase any state-approved insurance plan.  The insurance plans not sold on the exchange may offer less coverage than those sold on the exchange.  As an example, a plan not sold on the exchange may not offer maternity coverage.

The second thing Alexander's plan would do is remove the tax penalty for failing to buy a policy when there is no policy offered on the exchange.  Currently 16 counties in Tennessee have no insurer for 2018.  Currently, one in three counties in the nation have just one insurer in the local market.  The number of counties with only one insurer and the counties with no insurer are expected to increase in 2018.  While Alexander's plan sounds like a very reasonable proposal to me, I expect it to be be met with opposition.

Liberals will see any accommodation as a retreat from Obamacare and will argue that instead of retreat that the government needs to poor more money into the system to entice more insurers to participate in the exchanges.  I also would suspect that some conservatives will hold out for a full collapse of Obamacare and will view any modification as propping it up. We will see. Action must take place soon to avoid a crisis. Insurers are now setting rates and designing plans to meet a June deadline.  Alexander is to be commended for being the adult in the room. (For more see this link and this one.)

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