Idaho Gov. Butch Otter (R) on Friday signed an executive order aimed at loosening ObamaCare rules in the state, saying states need to take action on their own regarding the health-care law.
Otter signed the order directing the state’s insurance department to allow insurers to sell health plans that do not meet ObamaCare requirements.
While details are still being worked out, officials said that under the order insurers might not have to cover all of ObamaCare’s essential health benefits, which include areas like maternity care and mental health coverage.
State officials said they are trying to move forward with the changes on their own without any action from Washington, seeking to give people cheaper options. However, some have raised questions about whether that is legal.
Otter argued Friday that because Congress has now repealed ObamaCare’s individual mandate, states are free to allow skimpier insurance plans to be sold because people will no longer be penalized for lacking coverage that meets all ObamaCare requirements.
“Congress and President TrumpDonald TrumpOvernight Defense & National Security — Presented by Boeing — Milley warns of 'Sputnik moment' for China WSJ publishes letter from Trump continuing to allege voter fraud in PA Oath Keeper who was at Capitol on Jan. 6 runs for New Jersey State Assembly MORE have eliminated the individual mandate requiring all Americans to buy Obamacare plans or face financial penalties,” Otter said in a statement. “That means we will no longer be penalized for buying coverage that doesn’t meet all the Obamacare rules."
“We have been waiting patiently while Congress has been unable to find a solution and Idaho families have been forced to buy products that are too expensive and loaded with benefits they don’t want or need,” he added. “Now the door is open for states to pursue our own reasonable solutions.”
He indicated other states could follow Idaho’s example in making their own changes to ObamaCare rules.
However, while the individual mandate is being repealed, ObamaCare’s essential health benefits are still federal law, a serious obstacle for Idaho’s plan.
Tim Jost, a law professor at Washington and Lee University, said he doubted Idaho’s action would be legal.
“States can’t say we’ve decided we're not going to follow the federal law anymore,” Jost said. “We tried that in the 1860s and it didn’t work.”
Dean Cameron, the director of the state department of insurance, said in a phone interview that he did not expect major changes to the essential health benefits.
He said the latest version of the rules being worked out would cover “most of the essential health benefits if not all of them.”
But he argued that the state needed to take action to allow for cheaper plans that would help attract younger, healthier people back into an ailing market.
“We believe that the states are the laboratories of innovation,” Cameron said. “The president and many members of Congress have been calling for the states to innovate.”
Insurers would still have to sell an ObamaCare-compliant plan in addition to the new plans under the rules. People in the new plans would not be eligible for ObamaCare subsidies to help them afford insurance, though.
The executive order gives Cameron the authority to apply for a waiver from the federal government to make the changes if one is needed, but Cameron said the state is trying to act without having to take that step.
It is unclear whether even a waiver would legally allow the changes, Jost said, given the strict standards in ObamaCare for approving them.