To Sen. Patty Murray (D-WA), a plan by Idaho officials to allow Blue Cross to sell health insurance skirting requirements of the Affordable Care Act (ACA) is unquestionably “illegal.”
“Junk” plans, Murray said in a statement on Thursday, “threaten coverage for people with pre-existing conditions and drive up families’ health care costs.” Murray is the top Democrat on the U.S. Senate Health, Education, Labor, and Pensions Committee.
But the task of upholding the ACA falls to a federal administration that has acted to undermine Obamacare. Whether Alex Azar, the new Health and Human Services secretary, will crack down on Idaho, a Republican-controlled state, and enforce the ACA remains murky. When asked about it this week, Azar hedged, as the Washington Post reported, saying he had not seen a waiver request from Idaho to ask to bypass federal law.
“I can assure you if we do receive that, and if it does progress forward, we’ll be looking at it very carefully and measuring it up against the standards of the law, as is our duty,” he said at a congressional hearing.
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Idaho is the first state to roll-out non-ACA compliant plans. Gov. C.L. “Butch” Otter (R) issued an executive order in January directing the state’s insurance department to approve plans that met the state’s requirements, but not ACA provisions. Now, other states are watching and, depending on the outcome, may follow Idaho’s lead.
“If Idaho is able to do this, it will mean other … states will do the same thing,” Robert Laszewski, a consultant and former insurance industry executive, told Kaiser Health News. “If a state can ignore federal law on this, it can ignore federal law on everything.”
This week, Blue Cross of Idaho unveiled insurance plans that ignore key ACA provisions and provide cheaper premiums than ACA-compliant coverage, as the Idaho Statesman reported. The new plans will ask customers to complete a medical history and charge them more based on their health—something the ACA doesn’t allow.
Introducing less costly, non-ACA compliant plans will push premiums higher in plans complying with the ACA, warned Larry Levitt, senior vice president of the Kaiser Family Foundation, in a series of tweets Wednesday. “What Idaho is doing is creating a parallel insurance market that will siphon off healthy people with cheaper premiums,” said Levitt.
The new plans could be more costly for seniors because the state will allow insurers to charge them five times more than younger adults. The ACA, in contrast, caps senior’s premiums at three times the cost of younger adults.
The Idaho insurance commissioner requires the new non-ACA plans to cover pre-existing conditions for people who can show prior coverage. Blue Cross said its new plans will cover all of the ACA’s “essential health benefits,” including mental health care, emergency treatment, chronic disease management, and prescriptions—although one of the plans does not cover maternity care, as the Statesman reported. Unlike the ACA, the plans will cap yearly coverage at $1 million. Blue Cross will also continue to sell plans in Idaho that are ACA compliant.
Levitt said he expects middle-income people with pre-existing conditions to bear the brunt of higher premiums in the non-ACA compliant health plans. He suggested Obamacare’s subsidies will shield many with low incomes from premium spikes.