Insurance companies are opposing the Ted Cruz amendment which would legalize the buying and selling of plans outside of Obamacare.
So, if the Republicans are so cozy with big business, why are insurance companies fighting Ted Cruz’s attempt to end Obamacare? Basically, if Ted Cruz offered to simply allow the sale and purchase of insurance that wasn’t Obamacare compliant, it would speed up the “death spiral” for the ACA to the point that it would immediately crash. Instead, Cruz is trying to allow only insurance companies that offer Obamacare compliant plans to also sell non-compliant plans. But the death spiral will still be accelerated and insurance companies still fear the uncertainty.
The Wall Street Journal reports, “Insurers Oppose Cruz Amendment to Republican Health-Care Bill.”
The provision, backed by Texas Sen. Ted Cruz, would authorize insurers to sell coverage that wouldn’t meet ACA standards on the condition that they also sell at least some plans that did. While this setup could offer healthy people less expensive policies, insurers and actuaries say it would likely prove dysfunctional over time, pushing up rates and reducing offerings for people buying the compliant plans.
In a letter sent Friday night to the Senate Republican and Democratic leadership, the two major associations representing health insurers, which don’t typically send such missives jointly, said the amendment “is simply unworkable in any form and would undermine protections for those with pre-existing medical conditions, increase premiums and lead to widespread terminations of coverage for people currently enrolled in the individual market.”
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