Chicago Sun-Times

FACT CHECK: PRE- EXISTING CONDITIONS

- Lori Robertson l FactCheck.org

Democrats and Republican­s have made competing claims on whether the latest version of the GOP health care bill maintains protection­s for people with preexistin­g medical conditions. President Trump has said: “Preexistin­g conditions are in the bill. And I mandate it.” Democratic Sen. Chuck Schumer has said that “insurance companies could deny coverage to those with pre- existing conditions.” Neither of those comments quite gets it right. The latest version offers lesser protection­s than the Affordable Care Act, but it doesn’t allow insurers to deny coverage to someone with a health condition. We’ll go through what the Republican­s’ American Health Care Act, the legislatio­n that aims to replace Obamacare, now proposes on this issue.

The amendment in question was proposed by Rep. Tom MacArthur of New Jersey on April 25. It would allow states to apply for waivers from certain Affordable Care Act requiremen­ts for plans sold on the individual market, where those who buy their own insurance get coverage. Seven percent of the U. S. population, or 21.8 million people, are covered by health insurance purchased on the individual market.

The amendment calls for three waivers that would allow states to:

Increase how much insurers can charge based on age. Under current law, insurers can charge older individual­s up to three times as much as younger people. The American Health Care Act, beginning in 2018, would allow insurers to charge older people up to five times as much, and the amendment would allow the ratio to go even higher.

Establish their own requiremen­ts for the essential health benefits. Insurers currently must abide by a list of 10 benefits mandated by the ACA. The amendment would give the states the power to set their own essential benefits, beginning in 2020.

Allow insurers to price policies based on health status in some cases. The current law does not and the original GOP bill would not allow insurers to set premiums based on health status. But the amendment would allow it for those who do not maintain continuous coverage, defined as a lapse of 63 days or more over the previous 12 months. Such policyhold­ers could be charged higher premiums for pre- existing conditions for one year. After that, provided there wasn’t another 63- day gap, the policyhold­er would get a new, less expensive premium that was not based on health status. This change would begin in 2019, or 2018 during special enrollment periods.

Under the Affordable Care Act, insurers couldn’t deny anyone coverage based on their health status. And the amendment doesn’t change that part. As a Kaiser Family Foundation summary of the GOP bill says, it retains the “requiremen­t to guarantee issue coverage” — which means coverage must be offered regardless of health status — and it retains the “prohibitio­n on pre- existing condition exclusions” — which forbids insurers from excluding coverage specifical­ly for a policyhold­er’s pre- existing conditions.

But a waiver would allow insurers to charge some with pre- existing conditions higher premiums.

The waiver as proposed in the new amendment would enable states to allow insurers to price plans based on health status for those without continuous coverage.

States with such a waiver would also have to have a “risk mitigation program,” such as a high- risk pool, or participat­e in a new Federal Invisible Risk Sharing Program, as a House summary of the amendment says.

The programs are designed to help those with high medical costs.

To facilitate these programs, the bill calls for a Patient and State Stability Fund, with $ 100 billion in federal money over nine years and state matching requiremen­ts. States can apply to use the money for various purposes, including lowering out- of- pocket costs or setting up high- risk pools, which are state programs that cover high- risk individual­s. Such pools were in 35 states before the Affordable Care Act, and they typically keep individual insurance market premiums down by keeping the high- risk ( and high- cost) individual­s in their own pool.

Instead of setting up their own programs, states could use a default reinsuranc­e program, administer­ed by the Centers for Medicare & Medicaid Services, which would pay a percentage of high- cost claims.

An additional $ 15 billion would be used to set up the Federal Invisible Risk Sharing Program, another reinsuranc­e program. ( And $ 15 billion is set aside specifical­ly for maternity and mental health coverage.)

“Under reinsuranc­e, high- cost individual­s remain covered under private health insurance, but instead of financing their claims with premium revenue, the insurer submits the high- cost claims to the reinsuranc­e program,” said Karen Pollitz, a senior fellow at the Kaiser Family Foundation. The details of this program, such as how claims would be covered, would be determined by CMS.

A state applying for the waiver to allow some insurance pricing based on health status would have to use Patient and State Stability Fund money for one of those options: their own program, CMS’ default reinsuranc­e or the Federal Invisible Risk Sharing Program.

What the waivers and stability programs would mean for those with preexistin­g conditions remains to be seen.

 ?? MICHAEL REYNOLDS, EUROPEAN PRESSPHOTO AGENCY ??
MICHAEL REYNOLDS, EUROPEAN PRESSPHOTO AGENCY

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