When the U.S. House of Representatives Energy and Commerce Committee called in executives from top health carriers on Wednesday its chairman, Rep. Fred Upton (R-Mich.) was primarily interested in enrollment numbers and premium payment rates for plans sold via public exchanges. Some Republicans on the committee, in their questions to witnesses, appeared to be searching for ammunition to fortify an assessment that Obamacare has been misconceived from the start, and needs a fundamental overhaul.
But in addition to enrollment and payment data, its members also got a less critical perspective on the Affordable Care Act than they might have expected from an executive with America’s Health Insurance Plans (AHIP), the industry’s powerful trade group. Mark Pratt, AHIP’s senior vice president for state affairs, focused on how to build from the ACA’s foundation to make it better.
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The key, Pratt said, was finding ways to keep health care plans affordable — presumably a key goal of those who backed the ACA. At the top of Pratt’s hit list is the ACA’s health insurance tax that he estimates will take an $8 billion bite out of the system this year, and $100 billion over the next decade. He cited an AHIP-commissioned study that predicts the tax will raise the average cost of family coverage in the small-group market by $6,830 over the next 10 years.
Permanent delay?
Without suggesting a health care revenue alternative, Pratt endorsed a legislative proposal to delay implementation of the aforementioned tax for two years, perhaps in hopes that a new Congress and president would be amenable to making that delay permanent.
Pratt also expressed concern that the cost of even the least expensive plans sold on the public exchanges is high enough to motivate younger individuals to forego coverage, pay the tax penalty of $95 or 1 percent of income, then purchase coverage when they need it, thanks to the ban on preexisting condition exclusions. The odds of an adverse selection death spiral scenario could be reduced, Pratt testified, through allowing for so-called copper level plans.
Meet the copper plan
As described by backers of the concept, copper-level plans would cover about half of medical costs (versus the current 60 percent minimum) and set out-of-pocket limits above the current $6,350 and $12,700 for individuals and family plans, respectively. Witnesses representing Cigna, WellPoint and Health Care Service Corporation also voiced support for a new copper level plan.
AHIP’s Pratt also encouraged Congress to focus ACA reform efforts on:
- Pharmaceutical industry rules that limit competition among drug companies,
- A legal system that enables unjustifiable medical malpractice cases,
- Applying private sector anti-fraud best practices to public health care programs, and
- Ensuring “that collaboration between health plans and public partners accelerate the fight against fraud based on a flexible partnership.”
Stolz is a freelance writer based in Rockville, Md.
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