Insurers warn Cruz provision will ‘skyrocket’ premiums for sick people

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The two leading health insurer trade groups sent a strongly-worded letter Friday expressing opposition to a controversial conservative provision included in the latest GOP ObamaCare replacement bill.

America’s Health Insurance Plans and the Blue Cross Blue Shield Association warned that the provision from Sen. Ted Cruz (R-Texas) would mean “premiums will skyrocket for people with preexisting conditions” and “millions of more individuals will become uninsured.”

The letter expresses opposition to a provision, included in the new GOP repeal bill, that would allow insurers to sell plans that do not meet ObamaCare regulations, including the ban on discrimination based on pre-existing conditions, if they also sold plans that did meet the requirements.

Conservatives argue this move would allow younger, healthier people to buy cheaper plans.


The insurers, and many health experts, warn that only sick people would remain in the more expensive, more generous ObamaCare plans, leading to premium spikes for people with pre-existing conditions.

“This would allow the new plans to ‘cherry pick’ only healthy people from the existing market making coverage unaffordable for the millions of people who need or want comprehensive coverage, including, for example, coverage for prescription drugs and mental health services,” the letter states.

The insurers add that the funding in the bill that seeks to bring down costs for people with pre-existing conditions is “insufficient,” and even additional funding would not make the provision work.

“As healthy people move to the less-regulated plans, those with significant medical needs will have no choice but to stay in the comprehensive plans, and premiums will skyrocket for people with preexisting conditions,” the letter states.

“Finally, this provision will lead to far fewer, if any, coverage options for consumers who purchase their plan in the individual market,” the letter adds. “As a result, millions of more individuals will become uninsured.”

The rare joint letter from the two major insurer groups is also a departure from insurers’ general stance throughout the ObamaCare repeal debate, where they have usually declined to take a firm position either in favor or against the GOP bills.

Several moderate Republicans had previously objected to the Cruz amendment, but many have said they are undecided and still reviewing the revised bill, which includes the provision. 

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