RALEIGH (June 7, 2018) – Today the Senate House Health Care Committee held a hearing on a proposed committee substitute for House Bill 933, introducing dangerous new provisions that would endanger critical protections for North Carolinians with pre-existing conditions.
Under the guise of improving affordability, the bill would allow for the creation of new health insurance plans that would not be subject to state and federal insurance rules. That means that these plans would be able to discriminate against North Carolinians with pre-existing conditions by either refusing to cover them or charging them higher premiums based on their medical history. Even those who are able to “pass” the medical underwriting test may end up in plans that do not provide coverage for essential health care services they need, as these plans are completely exempt from existing insurance law.
By cherry picking young and healthy enrollees, these new plans would leave a sicker risk pool in the individual market, destabilizing the insurance market and causing premiums to skyrocket for those in need of comprehensive coverage.
The state of Tennessee has already experimented with this disastrous proposal, as they’ve allowed these unregulated insurance plans to be sold by the Farm Bureau since the early 1990s. As a result, these plans have cherry picked enrollment out of the individual market, and they have the second-worst individual market risk score in the entire country. In short, that means that people with pre-existing conditions face even higher premium costs as the risk pool is disproportionately older and sicker. This proposal seeks to turn the roughly 863,500 North Carolinians on the individual market over to a de facto high risk pool.
Proponents of this proposal, including the NC Farm Bureau, cite unaffordable premiums for many small businesses, but there’s a simpler solution that doesn’t rob sick Peter to pay healthy Paul: close the coverage gap by expanding Medicaid. Many farmers, fisherman, and other low-wage workers and small business employees are in the coverage gap.