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You seemed to have missed the part that said "the ACA's individual mandate, which is the foundation on which guaranteed-issue health insurance works.". Without

You seemed to have missed the part that said "the ACA's individual mandate, which is the foundation on which guaranteed-issue health insurance works.". Without the individual mandate, insurance companies have three options for pre-existing conditions. First, they can not insure them (which would be illegal). Second, they can raise rates for everyone who does have insurance. Third, lobby to have the pre-existing conditions section of the ACA repealed (which will now be much more palatable politically because in the mean time everyone rates will have sky-rocketed in the mean time). Since #2 is the likely outcome in the short term if this bill passes. Startup employees who have health insurance may see a windfall in the future with the options change, but they'll lose out month after month with increased insurance costs. But #3 would be up next, and the insurance companies will lobby hard, noting that they have been clear since day 1 that covering pre-existing conditions is only possible with an individual mandate. So long term, repealing the individual mandate and not covering pre-existing conditions look pretty much the same.

sachinag 9y ago
2a) They could find ways to charge people with pre-existing conditions more, as well.
- tptacek 9y ago
  That's difficult to do, because rate discrimination has to account for people who ruthlessly defer insuring themselves. Don't you think that if there was a number at which health insurance was economically rational for both parties, insurers would have offered it? Prior to the ACA, there was no such number.
koolba 9y ago
> You seemed to have missed the part that said "the ACA's individual mandate, which is the foundation on which guaranteed-issue health insurance works.". Starting with a premise that that ACA is working is invalid. In the current US health care system about 49% of people get coverage through their employers, 19% are covered by Medicaid, 14% are covered by Medicare, 2% are covered by other by other public plans (ex: VA), and 9% are uninsured (for various reasons including not being mandated to get coverage). That leaves 7% of people that get coverage on the individual market[1]. On average, the cost to insure people in that 7% is substantially higher than the 49% receiving coverage through their employers. That's for a variety of factors including them being statistically unhealthier (unemployed people tend to be sicker) and more broadly because employer's generally provide coverage through self-insurance that removes all profits from the equation. Large employers don't just buy coverage from Anthem or Horizon, they self-insure and buy an umbrella style master coverage to cover outliers. That leaves a small percentage of the 7% on the individual market that are not receiving any subsidies to pay a grossly outsized cost for health insurance because they're bearing the costs of the wider 7% risk pool. That's what's broken in the ACA and that's who bears the full impact of the mandate. The policy as it stands now is destined to implode as at some point that top end of the market will actively avoid it anyway. My solution to all of this is to ban employer provided coverage entirely and require the same open access provisions for health insurance to all plans. That would widen the risk pool substantially, eliminate issues with fragmented markets, and open the door for more job mobility (health insurance wouldn't be tied to your job). Throw in Medicaid for free at the low end and a public option with which one could buy into a Medicaid-lite to add additional competition in underserved markets and you've got a working healthcare system that can be layered upon our existing one. [1]: https://www.kff.org/other/state-indicator/total-population/?currentTimeframe=0&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D https://www.kff.org/other/state-indicator/total-population/?...
- cycrutchfield 9y ago
  That’s a wonderfully sensible solution, and it is one that our current congress would never pass in a million years.
- rhizome 9y ago
  the cost to insure people in that 7% is substantially higher than the 49% receiving coverage through their employers. That's for a variety of factors including them being statistically unhealthier (unemployed people tend to be sicker) From where do you draw the conclusion that the 7% individual market customers (if not 7% + 9% uninsured) are unemployed?
- tptacek 9y ago
  It is not accurate that most employer-provided health care is provided by firms that self-insure. Self-insurance is common among firms with more than 5000 employees, and sharply less common with firms with smaller numbers of employees. Though the majority of the American workforce is employed by "large enterprises", the definition of that term is "firms with more than 500 employees". Regardless of that: we already know what happens when the economics of health insurance for a region become unfavorable for insurers: they simply exit the individual (and, ultimately, the small-group) marketplace. No law requires insurers to offer products on the individual and small-group marketplace, and, without the mandate, it's reasonably straightforward to predict that many/most insurers will leave those markets.
  - koolba 9y ago
    > It is not accurate that most employer-provided health care is provided by firms that self-insure. Self-insurance is common among firms with more than 5000 employees, and sharply less common with firms with smaller numbers of employees. Though the majority of the American workforce is employed by "large enterprises", the definition of that term is "firms with more than 500 employees". According to this Wikipedia article it's 81% of workers getting health insurance through an employer are self-insure plans[1]. There's also an inherent bias towards healthier small organizations going the self-insure route. If I'm running a small shop and intimately know all the people involved (ex: family business), I know more about our healthcare needs and risks than any insurance company could. Based on that I can self insure and keep costs down or defer to getting policies on the individual market. Rational actors who are "more sick" will do that latter. > Regardless of that: we already know what happens when the economics of health insurance for a region become unfavorable for insurers: they simply exit the individual (and, ultimately, the small-group) marketplace. No law requires insurers to offer products on the individual and small-group marketplace, and, without the mandate, it's reasonably straightforward to predict that many/most insurers will leave those markets. And that's what congress needs to solve. Keeping the mandate might delay the implosion but it doesn't stop it. [1]: https://en.wikipedia.org/wiki/Self-insurance#Size_of_self-funded_market https://en.wikipedia.org/wiki/Self-insurance#Size_of_self-fu...

sachinag 9y ago

2a) They could find ways to charge people with pre-existing conditions more, as well.

tptacek 9y ago
That's difficult to do, because rate discrimination has to account for people who ruthlessly defer insuring themselves. Don't you think that if there was a number at which health insurance was economically rational for both parties, insurers would have offered it? Prior to the ACA, there was no such number.

koolba 9y ago

> You seemed to have missed the part that said "the ACA's individual mandate, which is the foundation on which guaranteed-issue health insurance works.". Starting with a premise that that ACA is working is invalid. In the current US health care system about 49% of people get coverage through their employers, 19% are covered by Medicaid, 14% are covered by Medicare, 2% are covered by other by other public plans (ex: VA), and 9% are uninsured (for various reasons including not being mandated to get coverage). That leaves 7% of people that get coverage on the individual market[1]. On average, the cost to insure people in that 7% is substantially higher than the 49% receiving coverage through their employers. That's for a variety of factors including them being statistically unhealthier (unemployed people tend to be sicker) and more broadly because employer's generally provide coverage through self-insurance that removes all profits from the equation. Large employers don't just buy coverage from Anthem or Horizon, they self-insure and buy an umbrella style master coverage to cover outliers. That leaves a small percentage of the 7% on the individual market that are not receiving any subsidies to pay a grossly outsized cost for health insurance because they're bearing the costs of the wider 7% risk pool. That's what's broken in the ACA and that's who bears the full impact of the mandate. The policy as it stands now is destined to implode as at some point that top end of the market will actively avoid it anyway. My solution to all of this is to ban employer provided coverage entirely and require the same open access provisions for health insurance to all plans. That would widen the risk pool substantially, eliminate issues with fragmented markets, and open the door for more job mobility (health insurance wouldn't be tied to your job). Throw in Medicaid for free at the low end and a public option with which one could buy into a Medicaid-lite to add additional competition in underserved markets and you've got a working healthcare system that can be layered upon our existing one. [1]: https://www.kff.org/other/state-indicator/total-population/?currentTimeframe=0&sortModel=%7B%22colId%22:%22Location%22,%22sort%22:%22asc%22%7D https://www.kff.org/other/state-indicator/total-population/?...

cycrutchfield 9y ago
That’s a wonderfully sensible solution, and it is one that our current congress would never pass in a million years.
rhizome 9y ago
the cost to insure people in that 7% is substantially higher than the 49% receiving coverage through their employers. That's for a variety of factors including them being statistically unhealthier (unemployed people tend to be sicker) From where do you draw the conclusion that the 7% individual market customers (if not 7% + 9% uninsured) are unemployed?
tptacek 9y ago
It is not accurate that most employer-provided health care is provided by firms that self-insure. Self-insurance is common among firms with more than 5000 employees, and sharply less common with firms with smaller numbers of employees. Though the majority of the American workforce is employed by "large enterprises", the definition of that term is "firms with more than 500 employees". Regardless of that: we already know what happens when the economics of health insurance for a region become unfavorable for insurers: they simply exit the individual (and, ultimately, the small-group) marketplace. No law requires insurers to offer products on the individual and small-group marketplace, and, without the mandate, it's reasonably straightforward to predict that many/most insurers will leave those markets.
- koolba 9y ago
  > It is not accurate that most employer-provided health care is provided by firms that self-insure. Self-insurance is common among firms with more than 5000 employees, and sharply less common with firms with smaller numbers of employees. Though the majority of the American workforce is employed by "large enterprises", the definition of that term is "firms with more than 500 employees". According to this Wikipedia article it's 81% of workers getting health insurance through an employer are self-insure plans[1]. There's also an inherent bias towards healthier small organizations going the self-insure route. If I'm running a small shop and intimately know all the people involved (ex: family business), I know more about our healthcare needs and risks than any insurance company could. Based on that I can self insure and keep costs down or defer to getting policies on the individual market. Rational actors who are "more sick" will do that latter. > Regardless of that: we already know what happens when the economics of health insurance for a region become unfavorable for insurers: they simply exit the individual (and, ultimately, the small-group) marketplace. No law requires insurers to offer products on the individual and small-group marketplace, and, without the mandate, it's reasonably straightforward to predict that many/most insurers will leave those markets. And that's what congress needs to solve. Keeping the mandate might delay the implosion but it doesn't stop it. [1]: https://en.wikipedia.org/wiki/Self-insurance#Size_of_self-funded_market https://en.wikipedia.org/wiki/Self-insurance#Size_of_self-fu...