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Health "Insurance" Becomes Health "Plans", Skirting Obamacare

by Countable | 4.2.18

What’s the story?

  • Iowa Republican lawmakers are looking to skirt the requirements for health insurance plans under the Affordable Care Act (ACA) by authorizing insurers to offer "health benefit plans". The change in terminology, they hope, will exempt the low-cost plans from federal regulations on minimum coverage.

  • The Washington Post reports Gov. Kim Reynolds (R) is scheduled Monday to sign into law a bill allowing the century-old Iowa Farm Bureau to collaborate with the state’s dominant insurer to offer the low-cost plans.

  • When Congress repealed the individual mandate via tax reform they opened the door to strategies, like this one, to offer health coverage that doesn’t meet federal minimum standards.

How would the health benefits plans work?

  • The Iowa Farm Bureau’s idea is modeled after a similar one in Tennessee, which predates the ACA and has never been challenged by the federal government.

  • Any Iowa resident only has to pay a $55 dollar annual fee to be a member of the Bureau. County Bureau agents could offer plans for sale as soon as the fall.

  • The plans are targeted towards those individuals whose incomes are too high to receive ACA monthly premium subsidies, but who struggle to manage private insurance costs.

  • The Bureau and the insurer, Wellmark, still have to negotiate on rates and benefits, as well as how to handle anyone with pre-existing conditions, since the plans will not be obligated by law to guarantee to cover anything or anyone, even if they are a Bureau member.

  • Currently, the only insurer left in the Iowa ACA marketplace has raised premiums by an average of 57%.

What do you think?

If states can encourage the development of health benefit plans that individuals can afford, does it matter that there are not minimum standards for the benefits offered? Does it matter if the existence of these plans drives up costs for sicker individuals? If you could buy a "health benefit plan" instead of “health insurance”, would you? Should a change in name allow states to skirt federal law if they are still offering some kind of healthcare to citizens?

Tell us in the comments what you think, then use the Take Action button to tell your reps!

— Asha Sanaker

(Photo Credit: Wikimedia / Creative Commons )

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