Individual Mandate

Last night I made a big fuss about New Jersey Governor Phil Murphy signing a restoration of the ACA's individual mandate penalty into law.

It turns out that the Governor of Vermont also signed the ACA mandate restoration bill I wrote about back in March into law a few days ago as well...but it's not as noteworthy, for several reasons. As Louise Norris reports over at healthinsurance.org:

Vermont governor signs legislation to implement an individual mandate starting in 2020; working group will sort out enforcement details

Last week I noted that the New Jersey state legislature, along with new Governor Phil Murphy, has moved quickly to pass and sign into law a number of critical ACA protection bills, to:

  • Reinstate the ACA's individual mandate penalty,
  • Establish a robust reinsurance program to significantly lower insurance premiums for individual market enrollees,
  • Protect people from out-of-network "balance billing", and
  • Cancel out Trump's expansion of "Association Health Plans"

In addition, New Jersey already outlawed "Short-Term Plans" (and "Surprise Billing") before the ACA was passed anyway.

Well, until today, there was some lingering doubt about the first two bills (which are connected...the reinsurance program would be partly funded by the revenue from the state-level mandate penalty), as Gov. Murphy was reportedly kind of iffy about signing them. As I understand it, he's been supportive of both ideas but is concerned about the potential budget hit in case the mandate penalty revenue doesn't raise enough to cover its share of the reinsurance program.

For a couple of months now, I've been attempting to track a slew of state-based "ACA 2.0" bills slowly winding their way through various state legislatures. However, this is really a bit of a misnomer, since some of these bills aren't so much about expanding the ACA as they are about protecting it from various types of undermining or sabotage from the Trump Administration and Congressional Republicans.

In fact, as far as I'm concerned, they really fall into three categories, which line up nicely with my color-coded "3-Legged Stool" metaphor: Blue, Green and Red Leg bills.

Once again: The "Blue Leg" of the Stool covers everything which ACA-compliant individual health insurance carriers are required to include: Guaranteed Issue, Community Rating, 10 Essential Health Benefits, a Minimum 60% Actuarial Value rating, no Annual or Lifetime Caps on coverage, and a long list of mandatory Preventative Services at no out-of-pocket cost when done in-network.

 

So apparently Donald Trump's former Health & Human Services Secretary (and lover of first-class airfare on the taxpayer's dime) Tom Price addressed the World Health Care Conference this morning, and offered this gem:

Price says that he's not a big fan of the GOP tax bill's 2019 individual mandate repeal-- says it will harm the pool in the exchange markets & drive up costs

— Ariel Cohen (@ArielCohen37) May 1, 2018

Really. Gee. you don't say.

Making my eyeballs roll even further back in my head, here's what Price said just nine months ago (shortly before he was given the boot from the HHS Dept.):

Tom Price before/after shot/chaser:

I've noted before that now that the Republicans in Congress have repealed the ACA's much-hated (but vitally necessary) individual mandate penalty (effective 2019), the odds of it being reinstated at the federal level are virtually zilch. Even if there's a massive blue wave in November and the Democrats are able to retake both the House and Senate, they're extremely unlikely to be willing to face the same type of firestorm/backlash that they did back in 2009-2010 over it.

If you need proof of this, take a look at the "ACA 2.0" bills recently proposed by both the House and Senate Dems. Both versions check a whole bunch of items off of my "If I Ran the Zoo" wish list...but neither one includes restoring (much less increasing) the Individual Mandate penalty at the federal level.

Covered California’s Executive Director Addresses Harvard Study on Impact of Eliminating Individual Mandate on Enrollment and Premium

SACRAMENTO, Calif. — Covered California Executive Director Peter V. Lee issued the following statement in connection with the Harvard Medical School Study, “Eliminating the Individual Mandate Penalty in California: Harmful but Non-Fatal Changes in Enrollment and Premiums,”published in Health Affairs. The Harvard study, conducted by a team lead by Dr. John Hsu, is the first national effort to measure the potential impacts of removing the individual mandate penalty based on surveying actual California consumers about their likely actions in the face of there being no penalty.

Last year, in my "If I Ran the Zoo" piece, I stuck my neck out and noted that the single biggest problem with the Individual Mandate isn't that it exists, but that it's not strong enough (conservative healthcare writer Michael Bertaut, who I disagree with on most issues but respect on this topic, also argues that the mandate has never been enforced strongly enough either). Here's what I said at the time:

The reality is that as much as everyone complains about the $695 or 2.5% income individual mandate penalty for NOT having qualifying healthcare coverage, the penalty should really be increased. There, I said it. The problem is that if the penalty is significantly less than the amount that the premiums would be, some people will still decide to eat the tax instead of signing up.

 

NOTE: The last few paragraphs of this post have been reformatted for clarity only.

All of Twitter is abuzz with this tweet (since deleted) by Republican Speaker of the House Paul Ryan:

A secretary at a public high school in Lancaster, PA, said she was pleasantly surprised her pay went up $1.50 a week ... she said [that] will more than cover her Costco membership for the year. https://t.co/yLX1Bod1j0

--Paul Ryan (@PRyan) February 3, 2018

While Ryan deleted the tweet above (fear not...a whole mess of people took screen shots before he did so), he has yet to remove another tweet quoting another passage from the same AP article (I took a screen shot of this one in case he deletes it as well):

“I have heard time and again that the middle class is getting crumbs, but I’ll take it!” https://t.co/yLX1Bod1j0

Welp. The Republicans did it. And later today, barring some dramatic last-minute development, the GOP Tax Scam is gonna be signed into law.

UPDATE: It's done. It passed the GOP House, GOP Senate and GOP House (again). Trump's signing it at any moment.

The GOP Tax Scam does many terrible things, of course, many of which are worse than repealing the ACA’s individual mandate. And even within the healthcare arena, the $25 billion PAYGO Medicare cut caused by the GOP tax scam is arguably more damaging overall.

Still, ACA stuff is my wheelhouse, so I’ll stick to the direct impact the bill (if it does become law) would have on the Affordable Care Act.

Above is the video explainer I whipped up a few weeks ago. It’s long and a bit wonky, but it should give a pretty good overview of the situation.

What about the two “market stabilization” bills that Susan Collins was supposedly demanding in return for her “Yes” vote? Yeah, about those:

 

Welp. There you have it.

It's not over yet, since the House of Representatives still has to vote on the bill again (either as is, or after hashing out the differences between the House and Senate versions of the bill), but assuming the final version of the bill includes mandate repeal and is indeed signed into law, this is what the ACA's 3-legged stool would look like when the dust settles.

Obviously I'll have much more to say about what happened last night soon, but for the moment I'll leave it at this.

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