Wednesday, December 7, 2016

Affordable Care Act: Repeal will be a snap, replace will be a bitch

The former Rhode Island Health Commissioner explains Why Republican health reform ideas are likely to fail.. Christopher Koller writes in Politico“I tried many of those ideas as Rhode Island’s health commissioner. Here’s what I learned.”

Koller describes in detail the various things Rhode Island tried to “build an individual insurance market with stable, affordable and high-quality coverage choices.” Koller closes with the lessons learned and advice to congressional Republicans.

Republicans are currently considering additional ideas that were not available to us in Rhode Island to encourage — but not mandate — young and healthy people to purchase insurance. One idea would require insurers to cover people with pre-existing conditions as long as they had continuous coverage beforehand. Another idea is to auto enroll people in a basic insurance plan, requiring them to proactively opt out of coverage.

These ideas are unlikely to work. One could argue automatic enrollment is a greater infringement on personal liberty than an insurance mandate. Moreover, our experience in Rhode Island shows that when given an option to forgo coverage, a segment of the healthy population most needed will seek it.

At best, these requirements will be only partially successful: A small portion will retain coverage, and regulators will struggle, as we did in Rhode Island, to keep the market stable and affordable. But at worst, market regulation will be insufficient and the reforms will set off a so-called death spiral where higher rates cause relatively healthy people to forgo coverage, leading insurers to raise rates even higher and more people to forgo coverage.

As Congress prepares to debate the repeal of Obamacare, it should be very careful with the design of the replacement. As our experience in Rhode Island shows, attempts to build an individual insurance market with stable, affordable and high-quality coverage choices based on voluntary participation will not succeed and could leave many people wishing for the good old days of the Affordable Care Act.

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