Washington – Most Connecticut residents receive health care coverage through their employers – but that doesn’t mean they won’t feel an impact if congressional attempts to repeal and replace Obamacare succeed.
The furious debate over health care has largely focused on how many people who now purchase policies on state exchanges, or who received coverage through expansion of the Medicaid program, would become uninsured. Less attention has been paid to changes that would affect those who receive coverage through their workplace.
All proposals introduced in the House or Senate, whether they repeal and replace the Affordable Care Act (ACA) or just repeal it, could result in higher premiums, less coverage and even a loss of certain benefits for many who now cover themselves and their families under an employer-based plan, especially if it is a small group policy.
According to the Connecticut Insurance Department, in 2016, about 2.4 million people in Connecticut had private insurance – that means they were not covered under Medicare, Medicaid or any other government health plan.
Of those who have private insurance, 86 percent obtained coverage though employer large-group plans, 8 percent through small-group plans and 6 percent on the individual insurance market.
The Congressional Budget Office this week determined 17 million people would become uninsured next year under a Senate plan to repeal the ACA and 18 million under another Senate bill that would repeal and replace the health law. Two million of those losing coverage under either bill are now getting their health insurance through their jobs.
The CBO explained why some who have employer health plans would become uninsured.
It said all GOP health care bills end the ACA’s individual mandate, which requires most people to have insurance coverage, and repeals the employer mandate, which requires businesses with 50 or more full-time employees to cover their workers.
“Under current law, the prospect of paying the employer mandate penalty tips the scale for some businesses and causes them to decide to offer health insurance to their employees. Thus, eliminating that penalty would cause some employers to not offer health insurance,” the CBO said.
It also said that demand for employer-based insurance increased under Obamacare because workers pressed their bosses to offer it so they would not have to pay the Internal Revenue Service a penalty because they were uninsured.
“Eliminating that penalty would reduce such demand and would cause some employers to not offer coverage or some employees to not enroll in coverage they were offered,” the CBO said.
Republicans who want to scrap Obamacare and move the nation back toward what they say is a more market-based health care system say repeal will result in more affordable health insurance and greater coverage choices for patients — including the choice to be uninsured.
They also say the Affordable Care Act individual marketplace is failing on its own as insurers hike premiums and leave state insurance exchanges where many who don’t have employer-based health plans purchase coverage.
Connecticut’s exchange, Access Health CT, could collapse if its two remaining insurers, Anthem and ConnectiCare, choose not to participate next year.
Bosses offering stripped-down policies
But there are those who are concerned that the end of the Affordable Care Act – and the resulting spike in the uninsured – would result in a cost-shift toward employer-based insurance policies.
With the end of Obamacare, hospitals and doctors would treat an increased number of uninsured patients, many of whom could not always pay for their services.
“Because they’ve lost paying customers, the hospitals and doctors would have to charge more to the people who are paying,” said Deb Polun, director of government relations for the Community Health Center Association of Connecticut. “The biggest impact when people are uninsured is that it raises the rates for everyone,”
Those on employer-based plans also might see a paring-down of benefits as businesses try to combat premium increases.
Under both the straight repeal and repeal-and-replace bills, insurers would be able to sell stripped-down plans that might be attractive to employers.
“It’s not just the loss of coverage, it’s the loss of coverage for people who need certain benefits, especially those with chronic conditions,” said Matthew Katz, chief executive officer of the Connecticut State Medical Society and an advocate for reforming the ACA, not repealing it.
Katz said ways to lower premiums, such as increasing deductibles and co-payments, “have gone through the roof already, so employers would have to look at other ways to cut costs,” such as offering their workers less coverage.
Other ACA protections, including the end of a cap on benefits after a patient generated a certain amount of medical costs – say $500,000 or $1 million – also would affect those covered through their jobs, especially if they required expensive treatments.
“Anyone who had cancer or an organ transplant would hit that cap right away,” Polun said.
The Affordable Care Act also required insurers to cover certain preventive care at no cost to patients. That means patients could once again face out-of-pocket costs for mammograms, colonoscopies, annual physicals and other preventive care procedures.
And insurers could once again charge more to cover women than men. So businesses that have many female employees, like retail stores and home health care agencies, probably would see even higher increases in premiums, Polun said.
Republican Senate leaders have not been able to muster enough support for either a straight repeal bill or one that would repeal and replace Obamacare, known as the Better Care Reconciliation Act, although they’ve changed it several times to try to woo balky GOP senators.
The math became more difficult for the GOP with the hospitalization of Sen. John McCain, R-Ariz, for a brain tumor.
Still, GOP leaders hope to press forward with their health care efforts next week.
On Thursday, the Senate’s second-ranking Republican, Sen. John Cornyn, R-Texas, said he expected a procedural vote on Tuesday to take up a healthcare bill, but said knowing what that bill would be is “a luxury we don’t have.”