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President Donald Trump said the latest Republican bill to get rid of Obamacare raises no concerns on coverage for people with pre-existing conditions.
The question has become a sticking point in the repeal effort. Before the Affordable Care Act, insurers could deny coverage to people who had cancer, asthma or some other illness. The law banned that practice.
"I would not sign Graham-Cassidy if it did not include coverage of pre-existing conditions," Trump tweeted. "It does! A great Bill. Repeal & Replace."
Trump is not entirely wrong, but his tweet papers over some pitfalls in what the bill offers.
The key section lies in the bill’s rules for state waivers from many regulations in the Affordable Care Act (starting at page 8 in the bill.) If a state says it "intends to maintain access to adequate and affordable health insurance coverage for individuals with pre-existing conditions," then it can allow insurance companies to charge sick people more than healthy ones.
Under the current rules, insurance companies can’t do that. They can’t factor in health, period. In addition, current Affordable Care Act rules limit the range for premiums and say companies can’t charge an older person more than three times what they charge a younger person.
The waiver does away with those limits (starting at the bottom of page 12 in the bill). A state’s commitment boils down to maintaining "access to adequate and affordable health insurance coverage."
"That’s not nothing" in terms of protecting people with pre-existing conditions, said Indiana University health care law professor David Gamage.
But beyond that, Gamage said the protection for pre-existing conditions gets murky.
"The bill says states have to do something, but what that something is is unclear," Gamage said. "And it’s overwhelmingly likely that what some states do will won’t be as robust as what people have now."
The health consulting firm Avalere found that 34 states plus the District of Columbia would see net funding cuts under the bill sponsored by Sens. Bill Cassidy and Lindsey Graham. The Kaiser Family Foundation had a similar finding. One way or another, it costs money to cover people with known health conditions, and most states would have less of it.
On top of that, Gamage said, Affordable Care Act regulations spread some of the costs across the private sector. Those regulations would go away, too, meaning it would be up to the states to make up the difference.
Cassidy spokesman Ty Bofferding disagreed.
"We have guaranteed issue and expect states to use invisible risk-sharing (where states reimburse insurers for higher cost people) or other policies to cover pre-existing conditions or face misuse of funds penalties," Bofferding said.
That might be a sincere hope, said law professor Wendy Netter Epstein at DePaul University, but the bill’s language doesn’t back it up.
"The terms ‘adequate’ and ‘affordable’ are very much subject to interpretation," Epstein said. "What is adequate and affordable for one person may not be for another. And it almost certainly doesn’t mean that those with pre-existing conditions have to be charged the same as those without."
If states fell short, Epstein said Washington regulators could try to hold their feet to the fire and press them to do better with their federal money, but "we can anticipate a whole lot of litigation." And even a win for Washington might not mean much in practice.
"Folks who are sick and need health insurance coverage now don’t have the luxury of time to let these legal debates play out," Epstein said.
Both Epstein and Gamage said in theory, states might find ways to squeeze much more health coverage out of each dollar. Or failing that, they might decide to put much more of their own money into health care and re-establish rules modeled on the Affordable Care Act. But they said neither outcome is likely.
Epstein said there’s an underlying disagreement on what it means to cover people with pre-existing conditions. Under the Affordable Care Act, those people got the same kind of coverage at the same price as others.
"But that’s not what President Trump and Sen. Cassidy mean when they say that the bill continues to require coverage for people with pre-existing conditions," Epstein said. "They mean that insurers will have to continue to cover people, but not at the same rates. And the policies don’t have to provide the same coverage."
Trump said the Graham-Cassidy bill does include coverage of pre-existing conditions.
The bill does address pre-existing conditions, and if states want billions of dollars in federal aid, they must show they intend to keep coverage accessible and affordable.
But the other parts of the bill allow states to give insurance companies a free hand in charging those people higher premiums. Professors who study the U.S. health care system said the bill’s language protecting people with pre-existing conditions is vague and subject to broad interpretation.
Plus, they said the bill’s reduction in funds going to two-thirds of the states will make it harder for them to protect people with past health problems. Under no circumstances do the protections in the bill equal the ones Americans have today under the Affordable Care Act. They are less.
There’s an element of truth in Trump’s tweet but it obscures critical details. We rate this claim Mostly False.
Donald Trump, tweet, Sept. 21, 2017
Office of Sen. Bill Cassidy, Graham-Cassidy section by section, accessed Sept. 19, 2017
Office of Sen. Bill Cassidy, Graham-Cassidy bill text, accessed Sept. 19, 2017
Milliman, Impact of Changing ACA Age Rating Structure, Jan. 31, 2017
Kaiser Family Foundation, Health Insurance Market Reforms: Rate Restrictions, June 2012
Avalere, Graham-Cassidy-Heller-Johnson Bill Would Reduce Federal Funding to States by $215 Billion, Sept. 20, 2017
Email interview, Wendy Netter Epstein, Associate professor, College of Law, DePaul University, Sept. 21, 2017
Interview, David Gamage, professor of law, Indiana University Maurer School of Law, Sept. 21, 2017
Email interview, Ty Bofferding, press secretary, Sen. Bill Cassidy, Sept. 20, 2017
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