Even Insurers Dislike Ted Cruz Idea To Permit Stingy, Unregulated Plans

Riccardo Savi/Sipa USA
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The top insurance trade group on Wednesday came out against an amendment being pushed by some Senate Republicans in exchange for their support of the GOP Obamacare repeal bill.

America’s Health Insurance Plans (known as AHIP), said that the proposal by Sen. Ted Cruz (R-TX)—which would let insurers sell stingy, unregulated plans as long as they also offer at least one Obamacare-compliant plan—”would be infeasible and not solve the problems of an unlevel playing field” and would result in “unaffordable premiums for those with pre-existing conditions.”

AHIP’s reaction further complicates Senate Republicans’ path for passing the repeal bill, the Better Care Act. At least one GOPer, Sen. Mike Lee (R-UT) has indicated he won’t vote for the bill unless the Cruz amendment is included, while other Republicans have expressed concerns similar to AHIP’s.

AHIP said in its statement that allowing regulated and unregulated plans to be sold in the same market would “would fracture and segment insurance markets into separate risk pools and create an un-level playing field that would lead to widespread adverse selection and unstable health insurance markets.”

“This is particularly true for patients with pre-existing conditions—who would be most affected and potentially lose access to comprehensive coverage and/or have plans that were far more expensive, as premiums in the Exchange market would rise much faster than under existing market conditions and insurance options dwindle,” the statement said.

AHIP typically holds its cards close to the vest and so far has mostly held back on criticizing the GOP bill, which includes other provisions that it favors.

Two versions of the Senate bill will be unveiled this week, GOP lawmakers have said: one with and one without the Cruz amendment. The Congressional Budget Office is analyzing the amendment, but it’s unclear whether its score of it will be released when its analysis of the revised legislation comes out in the days to come—likely next Monday, Republicans have said.

Read the full AHIP statement on the Cruz amendment below:

ABOUT THE AUTHOR

Tierney Sneed is a reporter for Talking Points Memo. She previously worked for U.S. News and World Report. She grew up in Florida and attended Georgetown University.
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