Collins, Wyden introduce amendments to hold down premiums and expand health care choices

Bipartisan amendments offered to Senate health care bill

Washington, D.C.-. U.S. Senators Ron Wyden (D-Ore.) and Susan Collins (R-Maine) today filed three bipartisan amendments to the “Patient Protection and Affordable Care Act.” If adopted, the amendments will improve the Senate bill by doing more to hold down premium increases for all Americans while expanding health care choices for more Americans and their employers.

“At the end of the day, Americans don’t care if a health reform proposal originated with a Democrat or a Republican, what matters to them is that it works,” Senator Wyden said. “I’m proud to join forces with Senator Collins to offer common-sense amendments that will hold down premium costs and make health care more affordable for American families and their employers. As I have long said, the best way to hold down health care costs and make insurance companies accountable is to put Americans in the driver’s seat and empower them to pick the plan that best fits their needs.”

Senator Collins said; “Health care reform should give Americans more choices of affordable health insurance options. That is why I am pleased to have worked closely with Senator Wyden on this bipartisan amendment that would help keep costs down and provide individuals, employers and employees with more health care choices.”

Senators Wyden and Collins are proposing as amendments to the “Patient Protection and Affordable Care Act” the following three amendments:

MORE CHOICES FOR EMPLOYERS AND WORKERS: While the current Senate legislation will eventually make it possible for employers to insure their workforce in the new health insurance exchanges, the legislation does not contain a mechanism to make it possible for employers to offer their workers the ability to choose any plan offered in the exchange. This Wyden-Collins amendment would correct that by making it possible for employers – who want to offer their employees the full range of choices in the exchange – to do just that while increasing competition in the new marketplace:

Under the amendment, any employer that sponsors a health plan would have the option to offer tax-free vouchers to its workers equal to the amount the employer contributes to its own health plan. Workers could then use that voucher to purchase the exchange plan that works best for them and their family. If a worker decides to purchase a less-expensive plan the worker would keep the savings as added income just as workers wanting to purchase more generous plans in the exchange will be able to pay the additional cost out of pocket. Whatever employers pay for vouchers will remain tax deductible for employers and tax free for employees; and while no employer will be required to offer vouchers under the new system, in order to encourage participation, employers who want to offer their employees tax-free vouchers will be given accelerated access to the new health insurance exchanges. Under the amendment, any employer offering its workers vouchers would have access to the exchange in 2015 rather than 2017, which is the schedule for employer access in the bill.

OFFERING MORE CHOICES IN THE EXCHANGE: This amendment will make it possible for individuals, who are not eligible for a subsidy, to purchase a catastrophic plan, regardless of age. Catastrophic plans will typically have much lower premiums than other plans offered through the exchange but subscribers will pay for most of their health care expenses “out-of pocket” up until they exceed their plan’s catastrophic limit.

Americans should have the choice to purchase more affordable coverage, if that is what works best for them. Under the Patient Protection and Affordable Care Act, individuals up to the age of 30 are eligible to purchase these plans. The Wyden-Collins amendment will extend that option to individuals – not receiving government subsidies – over the age of 30. This amendment would give consumers more choice and help ensure that more people can purchase coverage that fits their needs and is affordable to them.

The amendment includes aggressive disclosure requirements that will require catastrophic subscribers to certify that they understand the terms of the coverage and know that they are purchasing the lowest level of coverage available.

III. HOLDING DOWN PREMIUMS FOR CONSUMERS: Starting in 2010, the Patient Protection and Affordable Care Act will impose an annual fee on insurance companies based on the number of premiums written each year. This amendment will modify that fee to create an incentive for insurers to hold down rates. So, for example, insurance companies that hold down premium increases will pay lower fees, while insurers who jack-up their premiums will pay much higher fees. Starting in 2010 the fee will be varied by as much as 50% based on how aggressively insurers control costs which will give them a strong incentive to hold the line on overhead, executive salaries, provider payments and inefficiency. As under the bill, the total amount of the annual fee will be $6.7 billion per year.