Gottlieb falsely claims Senate bill eliminates individual market outside of exchange

››› ››› JUSTIN BERRIER

In a New York Post column, Scott Gottlieb claimed that under the Senate health care bill, "the individual market - the ability to go directly to an insurer and buy a health-care policy - will disappear," and "we'll all get the same package of benefits." In fact, under the Senate bill, individual (nongroup) plans can still be offered outside of the exchanges, and benefit packages can vary, as long as the policies meet the minimum requirements established by the legislation.

Gottlieb falsely claimed that under Senate bill, people can only buy insurance "in the exchanges or through your workplace"

From Gottlieb's December 21 New York Post column:

The plan before the Senate creates a set of 50 state-based insurance "exchanges" that are established as markets for health plans. Consumers must buy policies from their employers or through the exchanges - but, either way, their choice of coverage is limited to one of four basic insurance plans that the government sanctions.

[...]

Once the exchanges are in place, the individual market - the ability to go directly to an insurer and buy a health-care policy - will disappear. You'll have only two places to buy insurance, in the exchanges or through your workplace.

In fact, the bill allows individuals to buy "a health plan offered outside of an Exchange." Contrary to Gottlieb's claims, the Senate health care legislation explicitly allows individuals seeking insurance to enroll in a health plan outside of the exchanges. From Section 1312 (Consumer Choice):

(d) EMPOWERING CONSUMER CHOICE.-

(1) CONTINUED OPERATION OF MARKET OUTSIDE EXCHANGES.-Nothing in this title shall be construed to prohibit-

(A) a health insurance issuer from offering outside of an Exchange a health plan to a qualified individual or qualified employer; and

(B) a qualified individual from enrolling in, or a qualified employer from selecting for its employees, a health plan offered outside of an Exchange.

CBO: Under Senate bill, millions of people will still be covered by nongroup policies outside of the exchanges. According to the Congressional Budget Office [CBO] analysis of the Senate health care bill incorporating the manager's amendment, enrollment in "Nongroup and Other" plans offered outside the exchange will be 25 million in 2019, a change from 30 million under current law. CBO notes that "Other" "accounts for about half of current law coverage" and "the effects of the proposal are almost entirely on nongroup coverage," indicating that several million people will be covered by nongroup policies outside of the exchanges in 2019.

Without evidence, Gottlieb asserted "we'll all get the same package of benefits" under Senate bill

From Gottlieb's column:

The plan before the Senate creates a set of 50 state-based insurance "exchanges" that are established as markets for health plans. Consumers must buy policies from their employers or through the exchanges - but, either way, their choice of coverage is limited to one of four basic insurance plans that the government sanctions.

Private insurers will still compete to offer policies but must model their coverage on one of these four templates. In short, the Senate bill explicitly standardizes health benefits and then establishes elaborate mechanisms (including subsidies and penalties) to pay for them.

Here's the rub: While these four plans vary from low- to high-cost options, the benefits offered under them are pretty much the same. The difference between the cheaper and pricier plans is mostly the amount of cost sharing (e.g., you pay less for insurance if your co-pays are higher).

In effect, the plan creates a single national health-insurance policy. Consumers' only real option is to trade higher co-pays for lower premiums. But we'll all get the same package of benefits established by a series of new agencies and an "insurance czar" seated in Washington.

In fact, everyone would get minimum essential benefits as required by Senate bill. The legislation requires health plans to provide the minimum essential health benefit package, but does not limit plans from offering benefits in excess of the minimum. From section 1302 (Essential Health Benefits Requirements):

(5) RULE OF CONSTRUCTION.-Nothing in this title shall be construed to prohibit a health plan from providing benefits in excess of the essential health benefits described in this subsection.

Posted In
Health Care, Health Care Reform
Network/Outlet
New York Post
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Scott Gottlieb
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