Congressional Republicans unveiled legislation on Monday that would funnel billions of dollars to Obamacare markets, and hope the provision can be attached to the long-term government spending that’s due Friday.
The new bill would fund insurer payments known as cost-sharing reduction payments for three years, and offer $30 billion in reinsurance funds distributed evenly for three years. It includes more flexibility for states to implement changes to their healthcare systems and allows more people to buy plans that have lower premiums and higher deductibles.
An aspect of the bill that hadn’t been previously disclosed specifies that health insurers would have to specify in their marketing materials that this type of coverage isn’t as extensive as Obamacare plans, and allows states to set up their own regulations on these plans. The Trump administration has proposed these plans should be extended from three months, a limit set by the Obama administration in 2016, to as long as 364 days.
The GOP proposal also requires the Department of Health and Human Services to issue rules about selling health insurance across state lines, a provision already proposed by the White House.
The bill has the support of Sen. Lamar Alexander, chairman of the Senate Health, Education, Labor and Pensions Committee; Sen. Susan Collins, R-Maine; House Energy and Commerce Committee Chairman Greg Walden, R-Ore.; and Rep. Ryan Costello, R-Pa.
“Our recommendations are based upon Senate and House proposals developed in several bipartisan hearings and roundtable discussions,” the four lawmakers said in a statement. “According to independent experts, our proposal would reduce premiums in the individual market by up to 40 percent for farmers, songwriters, and small business men and women, and others who don’t receive insurance from the government or from their employer and who pay for insurance on their own.”
Democratic leaders who support Obamacare have previously said they would not vote to pass the bill because it also contains the Hyde Amendment, which prohibits the funding of abortions with taxpayer money, with limited exceptions.
An aide from the office of Sen. Patty Murray, the top Democrat on the HELP committee, reiterated this stance in an email after the latest GOP proposal was unveiled.
“Senator Murray is disappointed that Republicans are rallying behind a new partisan bill that includes a last-minute, harmful restriction on abortion coverage for private insurance companies instead of working with Democrats to wrap up what have been bipartisan efforts to reduce health care costs,” the aide said. “She hopes the unexpected release of this partisan legislation isn’t a signal from Republicans that they have once again ended ongoing negotiations aimed at lowering families’ health care costs in favor of partisan politics, and that they come back to the table to finally get this done.”
The consulting firm Oliver Wyman issued a recent report that said that gross premiums would fall by 40 percent if the bill were to pass. Various consumer and industry groups support the legislation, as does the U.S. Chamber of Commerce.
But according to a report funded by the Robert Wood Johnson Foundation, not every insurer is on board with receiving cost-sharing reduction payments. That’s because individual insurers negotiated with states so that they could structure subsidies for low-income people differently. Doing so allowed a higher number of low-income customers to receive higher subsidies paid for by the federal government that made their premiums less expensive.
Premiums are still more expensive for people who don’t receive subsidies because of the income cutoff in Obamacare, and federal spending is higher.
