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The Republican Health Care Bill Might Ruin Employer-Based Health Coverage, Too

Lifetime caps for everybody!

Chip Somodevilla/Getty Images

You knew that the American Health Care Act would turn the individual insurance market back into a bombed-out hellscape for the sick and old. But did you realize it could also ruin employer-based health insurance, at least for people whose companies worry more about cutting costs than attracting top-notch talent?

So reports the Wall Street Journal. The House GOP’s legislation—which seems likely to pass Wednesday (Update, 2:25 p.m.: The bill passed on a 217–213 vote)—would allow states to opt out from many of Obamacare’s insurance market regulations, such as those requiring carriers to cover a set of essential services or banning lifetime and annual caps on coverage. But even if states like New York and California don’t waive those rules, businesses operating in them effectively could for their own workers. That’s because the Obama administration released guidance in 2011 saying that employers could choose which state’s law they wanted to operate under when it came to required benefits packages. At the time, it didn’t matter much, since the Affordable Care Act created a single set of national standards. But now, per the WSJ:

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Under the House bill, large employers could choose the benefit requirements from any state—including those that are allowed to lower their benchmarks under a waiver, health analysts said. By choosing a waiver state, employers looking to lower their costs could impose lifetime limits and eliminate the out-of-pocket cost cap from their plans under the GOP legislation.

The Journal cautions that some companies may be hesitant to slash their employees’ benefits, since they use them to recruit talent, and notes that most big employers didn’t impose coverage caps prior to Obamacare. “Even if self-insured health plans are no longer banned from imposing annual or lifetime limits, they’re unlikely to attempt to squeeze the toothpaste back into the tube,” one industry expert told the paper. “The benefits of reimposing limits are questionable.”

But if you haven’t noticed, companies are doing everything in their power these days to shave health care costs (how are you doing on your employee wellness goals?). It seems perfectly reasonable to worry that, without the ACA’s protections, employer-based coverage will revert to something worse than the old status quo.

Ideally, we wouldn’t be talking about this for the first time just hours before a congressional vote. But public debate is apparently only for Democrats, these days.

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