Republican leaders are strongly considering an amendment from Texas Sen. Ted Cruz to let insurers sell plans that don't comply with Obamacare's insurance mandates as long as they sell some plans that do.
The idea behind the amendment is to address conservative concerns that the bill doesn't repeal enough of Obamacare's insurer mandates that conservatives say are driving up premiums. However, it is not clear how the amendment would spread risk among the people buying the Obamacare plans and the likely cheaper plans that don't comply with Obamacare.
Senate Majority Leader Mitch McConnell is said to be weighing the Cruz amendment instead of one in the House bill that lets states waive key Obamacare insurer mandates, according to a source familiar with the discussions.
But members of Senate leadership expressed concern with parts of the amendment, mainly the pool of people who would buy only the plan that meets Obamacare's mandates because it would have more comprehensive care.
"It has to be structured in a way that ensures the pools are not adversely affected," said Sen. John Thune, R-S.D., the third-ranking Republican in the Senate.
Sen. Mike Rounds, R-S.D., added that he liked the idea but only if there is a connection between the Obamacare pool rate and the other plans that don't have to abide by the mandates, which likely would make them cheaper.
"There has to be a ratio between the two that you maintain, otherwise you will run everybody out of that plan that is healthy and into the less expensive plans," Rounds said. "Then you end up with the federal government subsidizing that plan."
Text of Cruz's amendment is not available so it isn't known if it would provide for separate risk pools for people who buy the cheaper plans and people who get the plans complying with Obamacare.
It also isn't clear how having a shared risk pool between the two types of plans would affect premiums for the cheaper plan.
Premiums from the cheaper plans would help pay for the pricier and more comprehensive plans if they shared the same pool of people. Even if a plan isn't required to abide by Obamacare's rules, it could still be expensive because the money could be used to compensate for the people buying the pricier Obamacare plan, who are likely to be sicker and use more healthcare.
Conservatives have said that Obamacare mandates, including one that requires insurers to cover essential health benefits such as maternity care, force companies to increase costs for everybody. Other Obamacare mandates include a ban on lifetime caps and a mandate called community rating that prevents insurers from charging someone more based on their health history.
In the House bill, which passed the lower chamber last month, an amendment by Rep. Tom MacArthur, R-N.J., was included that lets states waive essential health benefits and community rating, which was put in Obamacare to help ensure that people with pre-existing conditions such as cancer can get affordable plans.
But House members were concerned about what would happen to patients with pre-existing conditions if states chose to waive community rating. So House leaders added high-risk pools to the bill to subsidize the cost of people with pre-existing conditions in those states, but the Congressional Budget Office said the $23 billion in funding for the pools was not nearly enough and that sicker people in those states would face higher prices.
The Senate bill let states waive only the essential health benefits.
That has rankled some conservatives who want more of the mandates to be repealed, but face resistance from other Republicans worried about people with pre-existing conditions facing higher costs.