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Got a Pre-Existing Condition? Your Premium Could Rise Sharply Under New GOP Plan

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As House Republicans frantically seek support for legislation to replace the Affordable Care Act, the biggest sticking point is whether the bill fulfills one of the GOP’s central pledges: preserving protections for people with pre-existing health problems.

More than a quarter of adult Americans under 65 have a pre-existing health issue, which includes everything from asthma and diabetes to heart disease and cancer, according to the Kaiser Family Foundation. Under current law, insurers cannot deny those or other sick people coverage or charge them more than healthy people. It’s one of the ACA’s most popular provisions.  

President Donald Trump insists that the GOP’s American Health Care Act makes good on that pledge, and House Speaker Paul Ryan says on his website that “under no circumstance can people be denied coverage because of a pre-existing condition.”

But a recent amendment to the AHCA, authored by House Republican Tom MacArthur (shown above), from New Jersey, provides a loophole. It allows states to let insurers charge higher premiums to sicker people if their coverage has lapsed, and if the state has set up a so-called “high-risk pool,” or special health insurance programs for sicker patients.

In a bid to garner more votes from moderate Republicans concerned about going back on their pledge to cover sick people, House Republicans said Wednesday they are discussing adding more funding for those high-risk pools.

But critics say that even with that extra cash those risk pools will be underfunded. And they point out that people with pre-existing conditions are especially likely to have gaps in insurance, because if they become too sick to work they may lose coverage through their employer, says Sara Collins, vice president of health care coverage and access at the Commonwealth Fund, a nonpartisan foundation that supports independent research on health and social issues.

And while those people may technically still have access to insurance, in practice it may be out of their reach. “If you can charge sick people whatever you want, that’s effectively denying people coverage,” says Linda Blumberg, a senior fellow in the Health Policy Center at the Urban Institute, a nonpartisan health policy research group.

Growing Opposition

The possibility that states could return to pre-ACA days when insurers charged sick people exorbitantly high rates is dashing Republican hopes that they can muscle enough support to pass the AHCA before Congress goes on break for a week starting Thursday.

It has also outraged consumer advocates and health industry players.

“This proposal clearly allows states to do away with protections for pre-existing conditions, letting insurers charge our most vulnerable populations more,” said Betsy Imholz, director of special projects for Consumers Union, the policy and mobilization arm of Consumer Reports. 

Consumers are already very worried about their ability to afford good quality medical care. In a recent nationally representative CR Consumer Voices Survey, 55 percent said they’re not sure they or their loved ones could afford insurance to get quality healthcare.

The American Medical Association, in a letter opposing the revised bill, warned that allowing insurers to charge much higher rates to sick people would make pre-existing condition protections “illusory.”

And a coalition of 10 patient advocacy organizations, including the American Heart Association and March of Dimes, said weakening the ACA rules would make insurance unaffordable for those who need it most.

Even late night talk show comedian Jimmy Kimmel spoke out against it, talking about his newborn son’s recent open heart surgery and what life would have been like for him without the ACA. “If you were born with congenital heart disease, like my son was, there was a good chance you’d never be able to get health insurance because you had a pre-existing condition,” Kimmel says.

Weaker Protections

The high-risk insurance pools that states could set up is an idea that’s been tried, with poor results, critics say. 

Before the ACA, 35 states offered insurance through high-risk pool plans to people likely to need costly care. Those high-risk plans were very expensive, offered limited coverage, and programs were underfunded in some states. As a result, there were waiting lists and no guarantee you could get coverage.

Blumberg, at the Urban Institute, says the $130 billion that Republicans would set aside to fund these programs through 2026 is  inadequate. In a last-minute bid to win over more votes, GOP leaders said Wednesday they are hoping to add another $8 billion more over five years to help people with pre-existing conditions pay for costly insurance premiums. 

But even that wouldn’t be enough if most states opt for waivers, says Larry Levitt, senior vice president at the Kaiser Family Foundation. He notes that 27 percent of Americans have pre-existing conditions that insurers won’t cover. If most states apply for waivers, as Levitt expects, “that’s not much money.”

“This amendment is like slapping a band-aid on a broken bone and expecting it to heal — it’s a drop in the bucket in terms of actually providing protections for the millions of people insurers consider to have pre-existing conditions,” says Imholz.

The pre-existing condition waiver isn’t the only aspect of the AHCA plan that puts people with pre-existing conditions at risk, says Collins at the Commonwealth Fund. The AHCA also calls for allowing states to waive a requirement that insurers cover 10 essential health benefits, including mental health and maternity care and prescription drugs.

“Both of these provisions combined would completely negate any protections for people with pre-existing conditions,” she says.
 

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