Sen. Marco Rubio, R-Fla., introduced legislation Tuesday to repeal a lesser-known Obamacare provision called “risk corridors” that protects insurance companies from potential unexpected changes in marketplace composition.
The bill is a not-so-subtle attack on the health care law, as its implementation would cause serious damage to the insurance exchanges.
The risk-corridors provision is essentially a safety net for insurers during the first three years of the law’s implementation, designed to protect the marketplace as a whole if more expensive patients sign up than anticipated. Insurance companies set cost estimates ahead of time. If costs end up being higher, the government pays part of the difference; if costs are lower, the insurance company pays the government.
Rubio’s bill, which he dubbed the Obamacare Bailout Prevention Act, would eliminate risk corridors altogether.
“[The bill] will ensure the Obama administration doesn’t have unaccountable blank-check-writing authority to bail out insurance companies at the expense of taxpayers,” Alex Conant, a spokesman for Rubio, wrote in an email. “Rubio’s bill will fully repeal the risk corridor provision in Obamacare, preventing a bailout under the existing risk corridor provision of Obamacare.”
The risk-corridors provision has attracted more attention recently, following the announcement of President Obama’s insurance cancellation ‘fix,’ which would allow insurers to extend policies that do not comply with the Affordable Care Act for another year.
“When Obamacare was debated and passed in 2009 and 2010, none of its proponents, including the president, told the American people that the law granted the federal government the authority to bail out insurance companies at the expense of taxpayers,” Rubio wrote in an op-ed in The Wall Street Journal on Tuesday. “But now their dirty little secret is out, and it should be wiped out from the law.”
However, the risk-corridors provision is important for avoiding the so-called “death spiral” of high costs and low participation that could jeopardize the law. A lack of risk protection could cause insurers to stop participating in the exchanges, or raise their premium rates.
The president has already told insurers that the administration’s assistance for them will be limited.
The proposed legislation is sure to attract some Republican support, and has already gotten the backing of numerous conservative organizations, including FreedomWorks, Heritage Action, and Americans for Tax Reform.
The bill is cosponsored by Sens. Saxby Chambliss, R-Ga.; James Inhofe, R-Okla.; Mike Lee, R-Utah; Mitch McConnell, R-Ky.; Rand Paul, R-Ky.; and David Vitter, R-La.
What We're Following See More »
"By all means vote, just not for Donald Trump." That's the message from USA Today editors, who are making the first recommendation on a presidential race in the paper's 34-year history. It's not exactly an endorsement; they make clear that the editorial board "does not have a consensus for a Clinton endorsement." But they state flatly that Donald Trump is, by "unanimous consensus of the editorial board, unfit for the presidency."
"Federal regulators on Thursday delayed a vote on a proposal to reshape the television market by freeing consumers from cable box rentals, putting into doubt a plan that has pitted technology companies against cable television providers. ... The proposal will still be considered for a future vote. But Tom Wheeler, chairman of the F.C.C., said commissioners needed more discussions."
"The Supreme Court is taking up a First Amendment clash over the government’s refusal to register offensive trademarks, a case that could affect the Washington Redskins in their legal fight over the team name. The justices agreed Thursday to hear a dispute involving an Asian-American rock band called the Slants, but they did not act on a separate request to hear the higher-profile Redskins case at the same time." Still, any precedent set by the case could have ramifications for the Washington football team.
The Hollywood Reporter takes a look at a little-known intersection of politics and entertainment, in which Trump campaign CEO Steve Bannon is still raking in residuals from Seinfeld. Here's the digest version: When Seinfeld was in its infancy, Ted Turner was in the process of acquiring its production company, Castle Rock, but he was under-capitalized. Bannon's fledgling media company put up the remaining funds, and he agreed to "participation rights" instead of a fee. "Seinfeld has reaped more than $3 billion in its post-network afterlife through syndication deals." Meanwhile, Bannon is "still cashing checks from Seinfeld, and observers say he has made nearly 25 times more off the Castle Rock deal than he had anticipated."