States Evaluate Establishing Their Own Health Insurance Mandates
Congressional Repeal of ACA’s Individual Mandate Leaves A
Number of Lawmakers Examining Replacement Measures
At least nine states are considering their own versions of a requirement that residents must have health insurance, a move that could accelerate a divide between states trying to shore up the ACA and other states intent on eliminating requirement.
Congressional Republicans in December repealed the individual mandate, a pillar of the ACA, as part of their tax overhaul. That cheered those who say people shouldn’t be forced to buy insurance, but it has now energized others who say a mandate is needed to ensure is coverage designed to keep premiums low.
Maryland lawmakers are pursuing a plan to replace the ACA mandate, which requires most people to pay a penalty if they don’t have coverage. States including California, Connecticut, Hawaii, Rhode Island, Washington, Minnesota, New Jersey and Vermont, as well as the District of Columbia, are publicly considering similar ideas.
This push illustrates a shift in the health care battle from Washington to the states, igniting a surge of activity that could redefine access and coverage for millions of consumers.
The ACA sought to create a uniform minimum floor for health coverage. It established certain benefits that many health plans had to cover and barred insurers from charging higher premiums to people with pre-existing conditions.
Congress failed to repeal the law overall but, in addition to erasing the individual mandate, they have used administrative actions to roll back the ACA’s requirements and give states more control. This creates an atmosphere of some states pursuing initiatives to keep or expand the ACA, while other states take actions to adjust the laws health policy.
Coming years could see a growing gulf on issues such as Medicaid benefits, consumer protections, insurer regulations, and the availability of cheaper, less-comprehensive health plans, health analysts say.
The individual mandate is the latest example and one of the most symbolic. The national repeal takes effect in 2019, an event the nonpartisan Congressional Budget Office has estimated will result in millions of people dropping or losing medical coverage. Moderates welcomed its demise, seeing the mandate impose a financial burden on lower-income people and an overall federal overreach.
Some states want to undo even more of the ACA. Idaho, for example, has moved to let insurers sell plans without all the benefits required under the ACA. Insurers would also be able to charge higher premiums to people who are sicker or older. It is unclear whether this state action will be banned.
Even within party ranks polls suggest that the mandate is the least popular part of the ACA, based on a poll from the Urban Institute, an economic and social policy research group. In addition, establishing a system to track individuals’ coverage, and possibly exact penalties through income taxes or other measures, would be a significant undertaking for states, health policy experts said.
Most of the discussions are still a “patchwork insurance system’ is unclear. Insurers may be more likely to stay in the ACA exchanges of states with a mandate, because it gives them a more predictable mix of healthy and sick customers.
Similarly, older and sicker people may prefer states with a mandate and other insurance regulations. But that depends on a host of factors, including whether a state expanded Medicaid, the percentage of residents who get health-related tax credits and a state’s potential moves to relax the ACA benefit requirements.
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