Should Health Insurers Be Prohibited From Denying Coverage or Charging Higher Premiums For Pre-Existing Conditions if Obamacare is Ruled Unconstitutional? (S. 1125)

What is S. 1125?

(Updated June 21, 2019)

This bill — the Protect Act — would prohibit insurers offering group or individual health insurance coverage from excluding enrollees because of pre-existing conditions and would require insurers to approve coverage for eligible applicants (known as “guaranteed issue”). It would also prohibit insurance companies from excluding coverage of treatments for a patient’s pre-existing condition, or from charging higher premiums due to pre-existing conditions. All are requirements of the Affordable Care Act (aka Obamacare) which could eventually be found unconstitutional by the Supreme Court due to ongoing legal challenge, so this bill would ensure those protections remain in place regardless of the outcome without affecting or altering Obamacare as it currently is.

Among the list of health-related factors that health insurance providers would be prohibited from discriminating against individuals for include: Health status; medical condition (both physical and mental); claims experience; receipt of healthcare; medical history; genetic information; evidence of insurability; disability; and any other health status-related factor determined appropriate by the Secretary of Health and Human Services (HHS).

Health insurance providers would be prohibited from requiring that a participant or beneficiary undergo genetic testing as a condition of receiving coverage. They could request that a participant or beneficiary take a voluntary test for research purposes, but would have to clearly state that the request is voluntary, that non-compliance wouldn’t impact enrollment status or premium amounts, and that no genetic information collected or acquired could be used for underwriting purposes.

Argument in favor

This bill would reaffirm that Americans with pre-existing conditions are protected against being denied a health plan, denied treatment for a pre-existing condition, or charged more for their condition. It will ensure that protections for Americans with pre-existing conditions remain regardless of what happens to Obamacare when an ongoing legal challenge is resolved.

Argument opposed

While protecting pre-existing conditions is a good start, this bill doesn’t go far enough in terms of replicating Obamacare’s consumer protections, like requiring the coverage of essential health benefits (like maternity care) and setting limits on how much enrollees could owe in out-of-pocket expenses.

Impact

Americans with health insurance and those looking for coverage; health insurance providers; and HHS.

Cost of S. 1125

A CBO cost estimate is unavailable.

Additional Info

In-Depth: Sen. Thom Tillis (R-NC) introduced this bill to ensure that no American is denied health insurance coverage or charged a higher premium because of pre-existing conditions in the event that Obamacare is found unconstitutional in an ongoing legal challenge:

“I strongly believe that no hardworking American should ever have to go to bed worried about being denied coverage or treatment if they or their children have a pre-existing condition, which is why I’m introducing the Protect Act. The American people have two distinct choices when it comes to the future of their health care. The one-size-fits-all approach being pushed by Democrats is a government takeover of our health care system and would eliminate choices for families. The American people deserve better. The Protect Act is an important first step towards protecting Americans with pre-existing conditions and pursuing patient-centered reform that will provide all Americans with the affordable and quality choices that work best for their needs and their budget.”

Senate Health, Education, and Labor Committee Chairman Lamar Alexander (R-TN), an original cosponsor of this bill, added:

“This legislation reaffirms that Americans with pre-existing conditions are protected against being denied a health plan, denied treatment for a pre-existing condition, or charged more for their condition. It will make sure that regardless of what happens to Obamacare, protections for Americans with pre-existing health conditions will not change.”

Obamacare is the subject of an ongoing legal challenge initiated by states with GOP leadership that has been gaining steam since a federal judge in Texas ruled that the law is unconstitutional now that its individual mandate to buy health insurance was repealed by the Tax Cuts and Jobs Act. An appeal in the Fifth Circuit Court of Appeals is underway, and the new House Democratic majority adopted a rules package that allows it to intervene in defense of Obamacare as the appeals process plays out, making it likely that will eventually reach the Supreme Court.

An analysis by the Center on Budget and Policy Priorities progressive think tank expressed opposition to the bill despite its provisions protecting pre-existing conditions, explaining:

“This bill would reinstate three protections at risk in the Texas case — prohibiting insurers from denying applicants based on pre-existing conditions, charging higher premiums due to a person’s health status, and excluding pre-existing conditions from coverage. But it would leave many others on the cutting room floor... Under the bill, insurers could:

• Exclude coverage of essential health benefits — such as maternity coverage, mental health coverage, and substance use treatment — as many plans did before the ACA;
• Impose annual and lifetime limits on how much they will pay out (in large employer plans as well as individual-market and small business coverage);
• Sell plans with no limit on how much enrollees could owe in out-of-pocket costs if they get sick (another change that would affect large employer plans as well as the individual and small-group markets);
• Charge higher premiums based on non-health factors that can strongly correlate to health risk, including gender; and
• Charge older people (most of whom have pre-existing conditions) far more, compared to younger people, than the ACA allows.”

This legislation has the support of 22 cosponsors in the Senate, all of whom are Republicans.

Media:

• Sponsoring Sen. Thom Tillis (R-NC) Press Release

• Sen. Tillis FAQ

• Cosponsoring Sen. Bill Cassidy (R-LA) Press Release

• CNN

• Center on Budget and Policy Priorities (Opposed)