A Republican congressman from Arkansas is working on what he calls a bipartisan health care bill that would close existing coverage gaps and lower costs: the Fair Care Act.
“I see it as one of the greatest needs in the country, from several standpoints. No. 1, every single person is affected by the health care system in this country at some point in their lives. So it is front and center for everyone,” Rep. Bruce Westerman said.
“The other thing is the skyrocketing debt the federal government has, the skyrocketing cost that we see in the private sector for health care. And if we want to get that under control, we’ll have to do something different to the system.”
Westerman has been working on the FCA with Avik Roy, founder of the nonprofit think tank Foundation for Research on Equal Opportunity in Austin, Texas, and others since 2017. The congressman hopes to file the Fair Care Act of 2020, with revisions and co-sponsors, next month, and his office is drafting a Senate version.
Westerman expects no major health care legislation to pass in an election year, but he said now is a good time to talk about it.
Pre-existing conditions would be covered under the FCA, and Ed Dolan, a senior fellow of the nonprofit Niskanen Center in Washington has described it as “much more than another repeal-and-replace effort” to take down the Affordable Care Act, or Obamacare.
The FCA would:
► Lift a requirement for businesses with 50 or more employees to offer health insurance;
► Establish an invisible high-risk pool reinsurance program with $20 billion a year for 10 years in federal funding plus a $4 annual fee on certain policies;
► Let workers offered employer-sponsored coverage buy individual policies and access health savings accounts (previously available only to those with high-deductible plans);
► Base eligibility for federal premium assistance on age and income, instead of just income;
► Offer states block federal grants and more waiver flexibility for Medicaid; and
► Implement measures designed to increase prescription drug and provider competition and encourage innovation.
Westerman emphasized that the FCA offers more options to employers and employees.
Workers would gain job mobility with affordable plans following them as they start new jobs or businesses. Companies could also contribute to savings accounts for employee use in paying medical bills.
Roy said employer-sponsored plans have become unaffordable for employers and employees. He also said employees don’t get to choose their plan when they get employer-sponsored coverage.
With the mandate gone, “Whatever creates a better deal for the patient will be the natural result,” Roy said. Under the reinsurance program, insurers would place in the program those policies they expect to have claims far exceeding premiums — plans for the very sick.
The insurer would keep 10% of the premium and pay the first $10,000 of claims. The program would keep the rest of the premium and pay the rest of the claims. The idea is that insurers would risk less money and that would put downward pressure on premiums.
However, Dolan said the long-term affordability of the reinsurance program concerned him because it’s based on the assumption that movement from employer-sponsored insurance to the individual market will be slow. “If that movement is more rapid, it’s going to need a lot more financing,” he cautioned.
Dolan was concerned about the Medicaid change as well, because it depends on the states cooperating, and many didn’t with Obamacare.
What sets the FCA apart from Democrats’ proposals is its strong cost-control measures, Dolan said.
Westerman said, “I think it’s going to do well in long-term affordability because of the way it’s structured to create more competition and options in the marketplace. … Creating a better marketplace is going to lower costs in the long run.”
Sign up for Daily E-news
