In which U.S. Senator Markwayne Mullin repeatedly proves he doesn't know WTF he's talking about

In my post about the U.S. Senate vote to end the federal government shutdown last week, I concluded that:

I'll have a lot more to say about this "HSAs for All" silliness which Trump & Sen. Cassidy are suddenly pitching, but in the meantime, whether you think 8 of them voting for the CR Sunday night was the right thing to do or not, once they did so, shifting the national dialogue back to healthcare policy (where Dems are strongest and Republicans are weakest) and the Epstein Files is probably the best outcome Democrats could've realistically hoped for from that point forward.

Almost every day since the, various Republican House & Senate members have underscored my point:

GOP Rep. Tom Emmer of Minnesota:

"You're gonna have to create High-Risk Pools again, just go back to where Minnesota was before [the ACA]...we literally based the healthy individuals were able to be in a pool and you could have competition, insurance competition that is, for different insurance products, in that healthy market...you could do that risk assessment.

Then we had a high risk pool because anybody who knows healthcare understands that a small part of the population consumes the majority of the healthcare, 'cus they need it. We had ways of addressing that....by supplementing that population, instead of doing what the Affordable Care Act did, which is totally upending the risk analysis by putting all of them together and saying the healthy people are going to be paying for the people who need more healthcare...instead of dealing with the people who require more healthcare and allowing healthy people to actually have competition in their marketplaces."

Oh Dear Lord.

Yes..."putting all of them together and saying the healthy people are going to be paying for the people who need more healthcare." Yes. Exactly. This is otherwise known as "SHARED RISK" AND IT'S THE UNDERLYING PRINCIPLE OF ANY TYPE OF INSURANCE.

It's true that before the ACA, many states did indeed have a "high risk pool" where they "had ways of addressing" the "small part of the population" who "consumed" the majority of the healthcare because they "needed it."

The "way they addressed it" was by massively underfunding those "High Risk Pools," among other things:

Covering the majority of uninsured Americans with pre-existing conditions through a national high risk pool would cost an estimated $178 billion a year, according to a 2014 Commonwealth Fund report.

• [Note: That would be over $247 billion/yr in 2025 based on CPI inflation, or over $290 billion/yr in 2025 based on NHES data.]

Guess what happens when you severely underfund a program and only provide a tiny fraction of the funding needed to run it properly? Either those participating in it have to foot the rest of the bill, or the service they receive ends up being a similar tiny fraction of what they need:

Premiums above standard non-group market rates – All state high-risk pools set premiums at a multiple of standard (i.e., typical or average) rates for medically underwritten coverage in the non-group market, usually 150%-200%...Other pools required people to pay the full premium, regardless of income.

Pre-existing condition exclusions – Nearly all state high-risk pools excluded coverage of pre-existing conditions for medically eligible enrollees, usually for 6-12 months. This made coverage less attractive for people who needed coverage specifically for their pre-existing conditions.

(Yes, that's right...even the high-risk pools, designed specifically for those with pre-existing conditions...denied those with pre-existing conditions from enrolling for up to a year. Tough luck if you've been diagnosed with a type of cancer which will kill you in less than a year without treatment).

Lifetime and annual limits – Thirty-three pools imposed lifetime dollar limits on covered services, most ranging from $1 million to $2 million. In addition, six pools imposed annual dollar limits on all covered services while 13 others imposed annual dollar limits on specific benefits such as prescription drugs, mental health treatment, or rehabilitation.

...A small number of states capped or closed enrollment to limit program costs, though enrollment caps were not allowed for HIPAA-eligible individuals. Limiting enrollment, directly or indirectly, was a key strategy to limit the cost of high-risk pools to states. By design, all state high-risk pools experienced net losses – that is, expenses greater than premium revenue.

U.S. Senator Roger Marshall of Kansas:

"We can expand access to association healthcare plans to ministry plans as well. We want to set up high-risk pools, reinsurance pools in every state as well. So there are a lot of things we can do. These are not new concepts. Speaker Johnson, I have been working on this together for years.”

Ah, yes. In addition to pushing "High Risk Pools," Sen. Marshall is also pushing two of the favorite ideas of scammers: "Association Plans..."

But these health plans, created for small businesses, have a darker side: They have a long history of fraud and abuse that have left employers and employees with hundreds of millions of dollars in unpaid medical bills.

The problems are described in dozens of court cases and enforcement actions taken over more than a decade by federal and state officials who regulate the type of plans Mr. Trump is encouraging, known as association health plans.

In many cases, the Labor Department said, it has targeted “unscrupulous promoters who sell the promise of inexpensive health benefit insurance, but default on their obligations.” In several cases, it has found that people managing these health plans diverted premiums to their personal use.

The department filed suit this year against an association health plan for 300 small employers in Washington State, asserting that its officers had mismanaged the plan’s assets and charged employers more than $3 million in excessive “administrative fees.”

...But Mila Kofman, a former insurance superintendent in Maine who has done extensive research on association health plans, said they also often falsely claimed to be exempt from state insurance laws, as a way to explain how they could offer premiums lower than those charged by licensed insurance companies.

...But history shows the risks of an expansion of association health plans. If a plan becomes insolvent, the impact on consumers can be devastating.

...when they went to the doctor, they found out all of a sudden that their insurance company, their perceived insurance company, was in receivership and that they had no coverage.”

...The defendants concealed the plan’s financial problems from plan participants and left more than $3.6 million in unpaid claims, the department said in court papers.

In another case, a federal appeals court found that a health plan for small businesses in New Jersey was “aggressively marketed but inadequately funded.” The plan collapsed with more than $7 million in unpaid claims.

...and "Sharing Ministry" plans:

A recent study from the Government Accountability Office (GAO) sheds new light on health care sharing ministries (HCSMs). The GAO interviewed officials from five HCSMs on plan features, enrollment, and marketing. The report includes, for example, information about HCSM use of paid sales representatives, administrative costs (one HCSM directs up to 40 percent of members’ contributions to administrative costs) and membership (one HCSM said a survey of their members found 42 percent had income under 200 percent of the poverty level, which would make them eligible for substantial subsidies for a Marketplace plan).

...Despite a history of fraud and unpaid bills, HCSMs are largely a black box for insurance regulators and the general public. Trinity, an HCSM administered by the company Aliera, recently went bankrupt; at least 14 states have taken action to shut down Aliera because of their malfeasance. Members suing Aliera are only expected to recoup one to five percent of the money they are owed, which can amount to hundreds of thousands of dollars.

More recently, the North Dakota Attorney General settled a lawsuit with HCSM Jericho Share for creating “a false impression that its products are health insurance” and using that false impression to sell memberships. Beyond the data in the GAO report, little is known about the operations or finances of HCSMs. A consumer considering becoming a member of a health care sharing ministry—with an expectation that their health care bills will be paid—may want to know, for example, if the HCSM has a history of stable revenue or keeps in reserve enough funds to cover members’ health care bills. To better understand what information is available, we reviewed publicly available audits and revenue reports to the IRS to see what information an ambitious consumer could obtain about an HCSM before enrolling.

And finally, today, you had U.S. Senator Markwayne Mullin of Oklahoma, who appeared on CNBC's SquawkBox with host Joe Kernan this morning and revealed himself to be utterly clueless about not just how health insurance works but also about how the ACA itself works:

There is zero reason for taxpayers to subsidize rich insurance companies. Let’s lower health care costs by allowing Americans to decide for themselves. A healthy 25-year-old shouldn’t pay the same insurance premium as an obese 50-year-old who smokes.

Hoo boy. OK, let's start with "taxpayers subsidizing rich insurance companies."

If you believe that, Sen. Mullin, I assume that means you support scrapping Medicare Advantage, in which private insurance companies are paid over $1,000 per month per enrollee, right? There's over 35 million Americans enrolled in Medicare Advantage, so that's a whopping $424 billion in taxpayer subsidies to them each year which can be eliminated by strengthening traditional Medicare instead, right?

But it's really the second part of Mullin's claim which caught my eye, where he states that "a healthy 25-yr old shouldn't pay the same insurance premium as an obese 50-yr old who smokes."

It appears that Sen. Mullin is unaware that under the ACA, in every state except for New York* & Vermont*, a 25-year old isn't charged the same premium as a 50-yr old. In fact, a 25-yr old is charged about 44% less than a 50-yr old for the same ACA policy.

This is called the Age Band, and in nearly every state a 64-yr old is charged 3x as much as a 21-yr old for unsubsidized ACA coverage. It's actually more like a 3.9:1 ratio if you compare a 64-yr old to a child under 15 years old.

Sen. Mullin also seems to be unaware that under the ACA, people who smoke tobacco can still be charged up to 50% more than non-smokers depending on the state, and just as importantly, ACA tax credits can NOT apply to reduce that.

In other words, a 50-yr old who smokes will have a base premium around 78% higher than a 25-yr old, and if they smoke as well, that premium will be up to 50% higher yet...or up to 2.67x as much (167% higher) as the non-smoking 25-yr old.

If you don't believe me, try it yourself: Visit HealthCare.Gov and enter my zip code here in Oakland County, Michigan (48304). Enter a single 25-yr old, no kids, non-smoker, earning, say, $70,000/year (to display unsubsidized prices).

Next, select Silver in the filters and select the 2nd-least expensive one (this is the Benchmark Plan for Oakland County, a UnitedHelathcare Silver Value plan). The unsubsidized cost will be $398.44/mo.

Then, go back and change the age of the enrollee to 50 years old, keeping them a non-smoker earning $70,000/year. The same benchmark plan will now cost them $708.79/mo...78% more than it did at 25 years old.

Finally, go back and keep them 50 years old but check off "Tobacco user" and the benchmark plan increases to $850.55/mo. In this case it's only 20% higher, but legally UnitedHealthcare could charge up to 50% more if they wanted.

In fact, when I ran the exact same experiment in Tulsa, Oklahoma (74130), I found that Oscar Insurance only appears to be charging a 1% smoker surcharge! The benchmark plan for a 50-yr old earning $70K is $788.56/mo next year, but if the same enrollee smokes, it only increases to $796.45/mo.

Sen. Mullin might want to lodge a complaint with them. It should be easy enough, seeing how Donald Trump's son-in-law's brother co-founded the company.

Now, there are some exeptions to this: There are some states where that smoker surcharge is less than 50% or doesn't exist at all. Most of those are blue states, which probably doesn't surprise you, but it also includes Arkansas (20%) and Kentucky (40%), so you might want to take your beef up with your Republican colleagues in those states.

*NY & VT have no age band; all enrollees do pay the same amount for the same policy; in MA the Age Band is 2:1 instead of 3:1.

In another clip from his interview, Sen. Mullin issues the following wisdom:

"Reward people for being healthy. Think about this. Healthcare is the only industry that you're not rewarded for taking care of your responsibility. If you think about homeowners insurance, if you're within 500 feet of a fire hydrant, your insurance goes down."

Setting aside the fact that the corollary for "reward people for being healthy" is literally "punish people for being sick," let's consider the implications of his comparison of health insurance to homeowner's insurance: If you live near a fire hydrant you get lower insurance rates.

Um...Mark? Wayne? Markwayne? You do understand that not everyone has the option of living near a fire hydrant, right? For that matter, not everyone has the option of "being healthy."

Like, if you're born with genetic anomalies, or get injured in a hit-n-run, or live somewhere with a high concentration of toxic chemicals & carcinogens in the air (a coal miner who gets Black Lung Disease, perhaps, or anyone who happens to live in a high-pollution area), you don't really have the "choice" to "be healthy."

I'm also not quite sure who Sen. Mullin thinks pays to install fire hydrants, so here's a clue: It's the taxpayers. And seeing how there's only around 7.5 million fire hydrants in the U.S. you'd have to have a lot more installed for everyone to be able to "choose" to live near one. Apparently installing a private fire hydrant--which I didn't even realize you could do legally--costs around $6,500 apiece.

As an aside, I also had to bang my head against the wall when I heard the opening question posed by SquawkBox host Joe Kernan:

"If individuals were able to pick exactly what they need and not pay any more for it, not get Cadillac plans when you're 25 years old...if all around the country, insurance companies could go interstate and not be domiciled in one place, all those things, you think are sufficient to bring affordable to people without Obamacare?"

(Sigh) YOU. NEVER. FUCKING. KNOW. WHAT. YOU'LL. FUCKING. NEED. WHEN. IT. COMES. TO. HEALTHCARE. THAT'S. LITERALLY. THE. POINT. OF. HAVING. INSURANCE.

In addition, 25 year olds don't have to buy a "Cadillac plan" via the ACA...anyone under 30 years old (and, starting in 2026, anyone older who isn't eligible for ACA tax credits) can buy a Catastrophic ACA plan. I just checked here in Oakland County, MI and a 25-yr old can get a Catastrophic plan for as little as $282/month in 2026 if they want to. In Mullin's birth town of Tulsa, Oklahoma Catastrophic plans for a 25-yr old start at $235/month.

As for Kernan's "going interstate" bit (aka "sell across state lines!"), once again: THE ACA ALREADY ALLOWS INSURANCE CARRIERS TO DO THIS AND NONE OF THEM HAVE EVER EXPRESSED ANY INTEREST IN DOING SO.

Buying health insurance across state lines has been proposed as an alternative to the Affordable Care Act – but it’s already in the law.

The Republican presidential front-runners, along with their trailing competitors, are all big fans of allowing Americans to buy health insurance across state lines, arguing that doing so would boost competition, resulting in lower costs and greater choice for consumers. Often, conservatives have framed such a plan as part of a replacement package for Obamacare.

The thing is, such permission is already part of President Barack Obama's health care law.

The little-known provision, found in section 1333 of the roughly 1,000-page Affordable Care Act, allows for states to create "health care choice compacts" permitting insurers to sell policies to consumers in any state participating in the compact, as long as they follow specific rules.

In fact, guess what?

Five states – Georgia, Kentucky, Maine, Rhode Island and Wyoming – already have enacted interstate compact statutes, according to the National Conference of State Legislatures.

So why hasn't anyone ever heard about this? Easy:

...not a single insurance carrier has expressed any interest in utilizing them, with very good reason: A Michigan resident enrolling in a healthcare policy sold out of Alabama isn't going to find it particularly useful unless they plan on making a 15-hour drive every time they have to visit the doctor or pick up a prescription.

In order for an insurance carrier to set up shop in a state, they have to establish a network of doctors, hospitals, clinics and other participating healthcare providers. Furthermore, those providers are subject to the home state's regulatory structure, not those of the state the carrier is based in. That takes an awful lot of time, money and resources to do, and can get confusing when the carrier is trying to intermingle the rules of one state with another in their internal operations. It's simply more trouble than it's worth.

As a result, if a carrier really wants to expand into a different state, all they have to do is establish a subsidiary corporation in that state with its own legal entity status, staff, policy offerings and so forth...which is exactly what some carriers have done. In case you haven't noticed, health insurance conglomerates like UnitedHealthcare, Aetna, Molina and so on do offer plans in more than one state...some are available in dozens, in fact.

Once again: Shifting the national dialogue back to healthcare policy is probably the best outcome Democrats could've hoped for, if only because it caused Republicans to once again start spouting insanity & making themselves look like idiots on every media outlet they can find. Keep it up, fellas!