With the return of congress in September, the Senate Health committee chairman Lamar Alexander (R-TN) and his ranking member Patty Murray (D-WA), will have to find a new method to bridge the gap between Obamacare and individual health insurance markets.
The first part of their plan is to implement a method of low-income cost sharing reduction subsidies for around a year. This way, those who are in a lower income bracket will have insurance while the insurers change the rate structure. The hope is that prices will be 15% to 20% lower than they would’ve been prior.
In order to have the democratic stabilization bill pass, there may have to be a compromise. The most likely compromise would be a piece of legislation that gives more freedom and flexibility to the market so that health plans could come up with better prices.
The largest problem that they found with the Obamacare exchange health plan was that it cost too much. the initial goal was to provide cheaper health care, but since a small amount of people signed up, the cost could not be divided amongst the pool they had hoped for, thus increasing the price. Some experts have stated that if the pool of people signing up rises, insurance prices could drop as much as 40% than they are now. This is not instant of course, and could take up to a couple of years, but the chance for lowered rates is high.
If more healthy consumers entered into the group, costs would be cheaper in the long-term and satisfaction would be unanimous across the board as those who need the insurance would have it, and those who don’t would feel satisfied with their safety and the plan they have.
Adding new levels of insurance will surely help the market grow, but in order to lower prices, the government must fist figure out how to get more people involved.
THE HERALD FINANCE REPORT
Start your workday the right way with the news that matters most.