The latest score of the Obamacare-repeal bill didn’t tell Republicans much they didn’t already know, but it did contain some potentially worrying news about a key feature that got it past the House: state waivers.
Senate Republicans are sticking to their goal to provide states more flexibility over their health care systems as part of their legislation, despite being warned that such changes could cause sick patients to lose their coverage. But—in the wake of the Congressional Budget Office’s new report—the Senate appears more determined to draft its own bill.
The CBO’s revised estimates for the House-passed American Health Care Act include assessments for waivers that would allow states to change the current mix of essential health benefits and allow patients with preexisting conditions to be charged more.
CBO estimated that states that substantially change the health care regulations could introduce instability for sick patients. “[P]eople who are less healthy (including those with preexisting or newly acquired medical conditions) would ultimately be unable to purchase comprehensive nongroup health insurance at premiums comparable to those under current law, if they could purchase it at all—despite the additional funding that would be available under [the AHCA] to help reduce premiums,” the CBO report says.
Senate Finance Committee Chairman Orrin Hatch said the CBO score caused a lot of concern, but added that he thinks the waivers won’t be jettisoned. “I think—I can’t say—but I think the waivers probably will be part of the final bill,” he said.
Sen. Bill Cassidy said CBO’s assessment of the state waivers showed that insurance can be made affordable for people who are younger, but it does potentially destabilize the individual market for those with preexisting conditions.
“So the question is can we imaginatively come up with something that allows them to buy a less expensive policy with limited benefits but nonetheless they are still in the same pool … they are still part of this bigger pool that helps those who are older and sicker or younger and sicker still have that benefit of a large risk pool,” said Cassidy.
Thomas Miller, resident fellow at the American Enterprise Institute, said that Senate Republicans could be more explicit about where money provided in the stability fund should go, such as for a high-risk pool or reinsurance program, rather than provide a laundry list of other possible purposes for the cash.
They could also be more direct about how the waiver that would allow medical underwriting could and should work for people who have had lapses in coverage, Miller said. For example, he suggested the bill would allow patients to regain access to the regular private individual market after spending a certain period of time in a high-risk pool.
Miller acknowledged that directly telling states what to do in this section may be ideologically hard for some Republicans to do, but he said they could improve messaging regarding what limited state waivers and insurance stabilization funding measures could achieve.
“If they don’t want to set the parameters so explicitly … at least explain it in a better manner so they don’t lose as much support for it,” he said.
Sen. Ted Cruz also voiced concern about the waivers possibly taking effect too slowly. “The CBO score suggested that the compromise reached in the House on waivers could have a slow uptake, and one of the things that was discussed is providing relief more quickly so that families who are struggling can receive relief not just in the long term but in the short term as well,” he said.
Experts told National Journal that states aren’t likely to shy away from the waivers, and could be pressured to take them up as other changes under the American Health Care Act take hold.
“I think it’s clear to me there would be a number of states choosing the waivers due to the pressure of eliminating the individual mandate” and reducing the premium support, said Dania Palanker, assistant research professor at the Center on Health Insurance Reforms at Georgetown University.
Where the Senate comes down on the subject will depend on what they hear from constituents, said Molly Reynolds, a fellow in governance studies at the Brookings Institution. “It seems to be interesting to watch what pushback, if any, they receive from constituents in their states over the recess,” she said.