ObamaCare orphans

Scott Gottlieb of the American Enterprise Institute is looking at people who lost their current insurance plans and either can’t afford ObamaCare plans or are getting worse coverage from ObamaCare plans or can’t get through the web portals to buy subsidized insurance. He suggests they be allowed to buy into the Federal Employees Health Benefits Program (FEHBP).

Brilliant idea. Just like it was when Bill Bradley came up with it fourteen years ago (although he made it way too complicated). Just like it was when I blogged about it more than four years ago. And again almost exactly four years ago when “Senate Democrats” started thinking about basing health insurance reform on the FEHBP.

Don’t get me wrong - I’m not claiming any particular intelligence in writing about this a few years ago. The instant Congressmen and Congresswomen started talking about exchanges, levels of coverage, and making sure health insurance plans are “adequate”, anyone with half a brain should have realized all that was already in place in the FEHBP. It’s kind of like re-using code when programming. If I knew I already had a program that, say, calculated profit/loss for one set of traders, how stupid would I have to be to write another program, from scratch, to do the same thing for a different set of traders? Hint: pretty darn stupid.

However, Mr. Gottlieb does seem to have missed some steps in his proposal. First, you can’t just dump ObamaCare orphans (a term I love) into the FEHBP; they have to go into a separate risk pool and that has a lot of ramifications. Mr. Gottlieb also doesn’t talk about whether his proposal includes any subsidies. It sounds like it doesn’t since he talks about using pre-tax dollars to buy FEHBP policies. The lack of subsidies can be a sticking point and why do the orphans who buy into FEHBP get to use pre-tax dollars while those who buy or bought the metallics don’t? I understand Mr. Gottlieb is trying to come up with something we can do quickly to help the orphans but not thinking things through is part of what got us into this mess in the first place.

If we must have a national health insurance plan then piggybacking it on the FEHBP is far more desirable than ObamaCare. I’d love to see it happen before January 1 - I feel somewhere between furious and heartsick thinking about people who will have health insurance on December 31 and not have it on January 1. But anyone who is proposing we move to that in the next 20 days needs to think carefully about how this will work. We’ve already wrecked the individual health insurance market; I’d hate to see us wreck the Federal employee health insurance market as well.