Speaker Mike Johnson (R-La.) unveiled the Lower Health Care Premiums for All Americans Act last week, the latest health-care reform proposal.
This comes on the heels of the Senate’s unceremonious dismissal of two competing health care plans last week.
The matter has taken on increased urgency as certain Obamacare subsidies are set to expire at the end of the month.
Democrats and some Republicans have pushed for an extension of the COVID-19-era enhanced subsidies.
Here’s what the House GOP is proposing.
Let the enhanced subsidies expire
Republicans argue that Obamacare is deeply flawed and that the subsidies themselves have driven the recent dramatic rise in insurance costs. This bill would let them run out on Dec. 31.
Expand access to association health plans
These allow small businesses or groups to band together to purchase group health insurance at lower rates than they’d get on their own. But the rules are strict.
Supporters say the GOP bill would make it easier for small businesses—and self-employed people—to join these plans.
Increase choice in the insurance market
Republicans want to increase tax-free employer contributions to funds employees can use to buy health insurance. They can already do this, but the law would make the arrangement permanent, not just a bureaucratic rule.
Small business owners would get a tax incentive for participating.
The program is called Custom Health Option and Individual Care Expense arrangements, or CHOICE, plans.
Reduce regulations on stop-loss insurance
Self-insured companies use their own funds to pay health insurance claims for employees, though those claims may be managed through a regular health insurer.
Stop-loss insurance is a tool used by self-insured companies to protect themselves against major losses. But some states regulate it to death.
The GOP bill would clarify that stop-loss coverage is not health insurance and is not regulated by individual states. That would make it easier for companies to design and fund their own health insurance plans.
Reform pharmacy benefit managers
These are the middlemen in the prescription drug supply chain. Insurance companies use them to negotiate drug prices with pharmaceutical companies, determine which drugs the insurer will offer, and set prices.
But they’re a black box. Nobody knows what discounts they get, or how much of that they pass on to the buyer.
This law would require pharmacy benefit managers to show the receipts—data on drug spending, rebate amounts, prices, the works.
Eliminate ‘Silver Loading’
This one’s a little complicated. The Affordable Care Act says insurance companies have to limit cost-sharing amounts in their silver plans for people below a certain income. Silver plans are the second-least expensive plans, and the most popular.
We’re talking about co-pays, deductibles, out-of-pocket maximums.
But here’s the catch. Congress didn’t provide money to reimburse the insurance companies for those mandatory discounts. So they upped the premiums on the silver plans. That “silver loading” created a spiral of rate increases.
Supporters say this bill would fix that by appropriating funds to reimburse those mandated discounts. That would reduce the federal deficit by $29 billion in 10 years, according to the Congressional Budget Office.
The House is expected to vote on the Lower Health Care Premiums for All Americans Act this week.
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