From Texas Standard:
The week began with expectations that by now, the Senate would be preparing for a vote on the GOP health care plan – perhaps over the holiday weekend. But that's not going to happen because Republican leaders couldn't muster the votes.
As one Texan, Sen. John Cornyn, was trying to sell the plan to his colleagues, Texas' other senator, Ted Cruz, was among many conservatives saying they couldn't support it. But then a funny thing happened – Cruz offered a peace offering of sorts: a compromise.
Dylan Scott is a policy reporter for Vox who has been following the health care debate and he was one of the first to report on the Cruz compromise plan. He says Cruz's idea is to allow insurance companies that offer Obamacare-compliant plans, with all of the associated coverage requirements, to offer non-compliant plans too, thus potentially providing lower-cost options for consumers. The need to address both kinds of insurance offerings is driven by moderate Republicans' discomfort with full repeal of Obamacare, Scott says.
"The important context here is that the conservative senators, including Sen. Cruz, want to roll back as many of Obamacare's insurance regulations as they can," Scott says. "But the problem is some of those regulations are really popular – like requiring health plans to cover everybody, no matter their health."
Scott says senators in different factions of the GOP have responded positively.
"I think there's a lot of interest," he says, noting that Sen. Lindsey Graham (R-South Carolina), who is not known as a Cruz ally, along with Republicans in the Senate leadership, have said they are open to the idea.
The challenge for the plan, Scott says, is that the mechanism by which Senate Republicans are attempting to pass their bill might prevent adding the Cruz proposal to the mix. The standards the GOP is using to pass the bill are designed to prevent Democrats from blocking it.
"It's not clear that changing insurance regulations meets those standards, which are supposed to limit the bill to only policies that affect federal spending and revenue," he says.
Additionally, Scott says, dividing the insurance market in the way Cruz envisions could lead sicker people to choose one kind of insurance, while more desirable insurance customers abandon that marketplace.
"If you segment the market like this… you could end up in a place where all the sick people buy Obamacare plans because it's more comprehensive, and all the healthy people buy non-Obamacare plans because it's cheaper, and they don't think they need comprehensive coverage," Scott says.
This kind of market segmentation could increase the cost of Obamacare-compliant plans significantly, and even destroy them.
Written by Shelly Brisbin.