CREDIT: AP Photo/J. Scott Applewhite
Last week, House Speaker John Boehner (R-OH) dropped his Federal Employees Health Benefits Plan (FEHB) and signed up for coverage in Washington D.C.’s health care exchange, as required by a Republican-backed provision of the Affordable Care Act.
Boehner’s office informed reporters that the congressman’s “health insurance premiums will nearly double — and his deductibles will almost triple.” Boehner and his wife currently pay $433 per month with a $700 deductible, but “would have to pay $802 per month in premiums, with a deductible of $2,000″ next year. “The Boehners are fortunate enough to be able to afford higher costs,” a spokesperson told Politico. “But many Americans seeing their costs go up are not. It’s because of them that this law needs to go.”
The Los Angeles Times’ Michael Hiltzik argues that the comparison is misleading since Boehner is not the typical Obamacare beneficiary.
The 64-year-old is moving from generous employer coverage into the individual market, where his age — just one year short of Medicare eligibility — would allow insurers to charge him three times as much for coverage as younger person and his high income would disqualify him from tax credits. Conversely, most of the people who are expected to sign-up for health care under the law are uninsured and 6 out of the 7 million who are projected to enroll in 2014 will qualify for federal subsidies. (Unlike most Americans, Boehner will also receive a subsidy from his employer to offset the cost of coverage).
But while Boehner may have to pay more under reform, if Republicans had their way and actually repealed Obamacare, the speaker and other older Americans would struggle to find any coverage at all under the alternatives the GOP has proposed.
In 2009, as the House of Representatives debated health care reform, House Republicans did offer a replacement bill that Boehner and most members of the GOP conference supported. In broad terms, the bill would have:
1. Provided $15 billion to help states establish high risk pools for sicker individual.
2. Eliminated annual or life time spending caps in individual plans, but permited insurers to deny coverage to people with pre-existing conditions.
3. Allowed insurers to sell policies across states lines. The insurer would only have to follow the rules of the state it declares to be its “primary” state, not of secondary states in which it can also sell policies.
4. Allowed businesses to form association health care plans.
So how would Boehner fare if he were required to drop his existing coverage and sign-up for Boehnercare? Not very well, it turns out:
1. Boehner would not find coverage in the individual market. Republicans hope to increase access to coverage in the individual market by giving individuals the opportunity to purchase insurance licensed in different states. But it’s unlikely that Boehner would be able to find an affordable coverage option. Insurers that sell policies in the individual market-place usually deny coverage to older Americans with pre-existing conditions or those at risk of developing chronic disease. In fact, one survey showed that “nearly three-quarters of people who tried to buy coverage in this market never actually purchased a plan, either because they could not find one that fit their needs or that they could afford, or because they were turned down due to a preexisting condition.”
2. Boehner would have to pay far more in high-risk pools. When Boehner is denied coverage in the individual market, he could apply for insurance in expanded state-based high risk pools, which typically provide very expensive coverage for the so-called “uninsurables.” State-based pools suffer from low funding levels and enrollment caps (large numbers of sick people are very expensive to insure, after all), meaning that “high-risk pool premiums were above 25% of family income for 29% of the medically uninsurable population.” As one paper concluded, “even when high-risk pool enrollment was possible, for a large minority of medically uninsurable individuals, it was unaffordable.” The GOP bill would invest $15 billion in high risk pools, but research ha found that “adequate funding would be on the scale of $15-20 billion a year to cover 4 million individuals.”
3. Boehner would not find stable coverage in association health plans. If Boehner can’t purchase affordable coverage from state-run high risk pool, he could join an association-sponsored plan. Unfortunately, under his own legislation, associations are not required to provide a standard package of benefits and have an incentive to craft skimpy policies that attract healthier applicants.