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Republicans Add Coverage Penalty To Health Care Bill

| by Robert Fowler

Senate Republicans have inserted an indirect insurance mandate into their legislation to repeal and replace the Affordable Care Act, commonly known as Obamacare. The revised bill now includes a penalty for Americans who go without health insurance for 63 days or more.

On June 26, Senate Republicans amended the Better Care Reconciliation Act, the GOP replacement for the ACA. The primary change was inserting a penalty for Americans who allow their health insurance to lapse for at least 63 days, blocking them from resuming health care coverage for another six months, The New York Times reports.

The ACA includes an individual mandate, which imposed a tax penalty on Americans who did not sign up for health insurance. GOP lawmakers had blasted the provision as among the most unacceptable components of Obamacare, and the BCRA originally excised the mandate.

In 2010, GOP Sen. Orrin Hatch of Utah blasted the ACA's individual mandate, asserting that it was unconstitutional.

"Congress has never crossed the line between regulating what people choose to do and ordering them to do it," Hatch said, according to NPR. "The difference between regulating and requiring is liberty."

Senate Republicans' decided to insert the insurance penalty amid vocal concern among insurance companies that not having a mandate would result in a system collapse.

Under the ACA, insurance companies were prohibited from denying coverage to Americans with preexisting conditions. The BCRA kept this provision but removed the individual mandate. Health care experts pointed out that by guaranteeing coverage to sick patients without incentivizing healthy Americans to also participate would result in a health care market dominated by enrollees with expensive medical needs. This would lead to what health insurance companies refer to as a "death spiral."

The six-month block is designed to provide an incentive for healthy Americans to continuously enroll for coverage. Kaiser Family Foundation Senior Vice President Larry Levitt took to social media to express skepticism that the new BCRA provision would be enough to avoid a death spiral.

"The likely biggest effect of a 6-month waiting period would be to prevent some sick people from getting care immediately after signing up," Levitt tweeted out.

"I doubt this encourages many healthy people to sign up," Levitt added. "That requires a lot of foresight among people not very focused on insurance."

Conservative scholar Joseph Antos of the American Enterprise Institute praised the new penalty as a preferable alternative to the individual mandate, describing it as "a better incentive to stay in coverage."

GOP lawmakers had actually been the first to propose an individual mandate. In 1993, Hatch and 19 other Republican senators proposed a health care bill that included the same mandate implemented by Obamacare. The legislation was designed as a counter proposal to former President Bill Clinton's efforts to require employers to cover their workers' health care costs.

In June 2010, the late GOP Sen. Bob Bennett of Utah reflected on how his colleagues had evolved on the individual mandate.

"There were people like me, who bought onto the mandate because it made sense and would work, and were were reluctant to let go of it," Bennett told The New Yorker. "Then, there were people who bought onto it slowly, for political advantage, and were immediately willing to abandon it as soon as the political advantage went the other way. And then there's a third group that thought it made sense and then thought it through and changed their minds."

Bennett, who had voted against the ACA before losing a GOP primary challenge, added that he supported Obamacare's individual mandate but "just wanted to express my opposition to the Obama proposal at every opportunity."

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