Republicans are proposing letting states opt out of the requirement that insurance plans cover a specific set of benefits, but experts say the items likely to be dropped account for a small fraction of the cost of premiums.
Source: ‘Skinny’ Plans Can’t Trim the Real Fat Under New GOP Health Bill: Experts – WSJ This article is likely to be behind a paywall for many of you, so here are some essential quotations:
In the latest version of their plan to repeal large portions of the Affordable Care Act, Republicans are proposing letting states opt out of the requirement that insurance plans cover a specific set of benefits.
Republicans hope consumers could save money by buying “skinny” plans, excluding items they may not need such as maternity care.
But many experts and studies indicate such changes might not drive down premiums very much, since insurance plans would still cover big, necessary items like hospital stays and doctor’s visits.
“The large bulk of costs under an insurance policy are doctors, hospitals and drugs,” said Larry Levitt, a senior researcher with the Kaiser Family Foundation, a nonpartisan think tank. “It’s hard to imagine a reasonable insurance policy that doesn’t include those benefits.”
According to a March paper from the health-care consulting firm Milliman, those three categories amount to 70% of the total average cost of insurance premiums.
According to the Milliman study, maternity care accounts for 3.4% of insurance costs, while mental-health services, which includes addiction treatment, tack on 4.2%.
Proponents of requiring such benefits say that before the ACA, people who needed them were forced to pay much more for coverage, and that removing them would have a much larger impact on those people than it would on the rest of enrollees who might pay slightly less.
They also say there is a risk that insurers wouldn’t offer certain benefits at all, since they would only attract higher-cost customers. In 2013, before the ACA was implemented, only around 2% of individual policies then being sold included every one of the ACA’s essential benefits, according to a study by HealthPocket, a health-insurance information company.
Some centrist Republicans like the required benefits, saying they protect consumers by preventing them from unknowingly buying insurance policies that lack crucial coverage areas.
The latest proposal seeks to split the difference, shifting the decision on required benefits to the states, which could keep all 10, craft a narrower list, or jettison the requirements altogether.