Under the Trump administration, the Centers for Medicare & Medicaid Services have proposed repealing a Biden-era limitation on the ability of health insurance companies to offer non-standardized plans through the Affordable Care Act health insurance marketplace.
The Biden-era rule limited insurers to offering a maximum of two non-standard health insurance plan designs per ACA metal level. The proposal would also discontinue the requirement that each health insurance company offer standardized plan design options on the marketplace.
We asked two professors and authors of ALM's Tax Facts with opposing political viewpoints to share their opinions about rolling back these limits.
Below is a summary of the debate that ensued between the two professors.
Their Votes:
Their Reasons:
Byrnes: The Biden-era rule limiting health insurance providers to offering two non-standard plans per metal level on the marketplace is completely arbitrary. The rule is aimed at preventing insurance companies from developing innovative health insurance plan options. It's not for the government to make health insurance decisions on behalf of individuals who are entirely capable of making their own choices — and who are, in fact, in the best position to understand their individual health risks and their own risk tolerance.
Bloink: The primary goal of the limits on non-standard plan offerings was to simplify the "shopping" experience on the health insurance marketplaces — to help consumers make smart choices about their health insurance needs. While this Biden-era rule is beneficial on many levels, we have to admit that comparing plans on the marketplace is incredibly challenging for the average consumer. By limiting non-standard plan offerings, we ensure that more taxpayers are enrolling in the quality coverage they need, rather than selecting catastrophic and other non-standard options merely because they cost less.
Byrnes: When we allow insurers to offer a variety of health insurance plan types, we aim to give consumers a robust display of options so that consumers can make their own choices when it comes to selecting the level and type of health coverage that's right for their situation. The Biden-era limitations are aimed at steering all consumers into one-size-fits-all health insurance plans.
Bloink: The rule also aims to allow insurers to stop offering standard comprehensive health insurance plans in the first place. Yes, these are often the most expensive types of coverage for insurers to offer — but they also provide the comprehensive coverage that Americans need and deserve. We should be encouraging health insurers to develop a wider array of comprehensive coverage options rather than allowing them to shift toward plans that simply don't provide the robust coverage Americans need.
Byrnes: We can't deny the fact that in many cases, steering individuals into standardized health insurance plans leads them to spend more than they need to be spending on health insurance coverage. This commonsense rollback attempts to allow insurance companies to make efforts to modernize the system and take us into the future of health coverage.
Bloink: The end result of this rule change would be to push more consumers into lower-cost insurance plans that provide a false sense of security. Overall, this move could serve to shift costs away from insurance companies and onto the backs of hardworking consumers--because these "innovative" plan solutions often serve to increase overall costs for consumers who use coverage, sometimes by lowering deductible amounts but increasing out-of-pocket maximums for the consumer when they're forced to seek health care.
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