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Obama or Romney: What Happens to Healthcare After Election

November 5th, 2012 – If Barrack Obama is re-elected then the Affordable Healthcare Act (aka Obamacare), should go into full effect on January 1st, 2014.  However, it’s entirely possible that the ACA’s subsidies may be scaled back as pressure mounts to reduce the federal deficit.

If Mitt Romney is elected he says he’ll repeal Obamacare.  However, doing so could be difficult unless Romney has the cooperation of a majority of both houses of Congress.  If he gains control of the Senate he could use the  reconciliation process.  If he’s unable to do that, Romney could find other ways to slow the act’s implementation, such as denying funding for the Affordable Care Act through the federal budget.

If Romney is elected he’s said he will keep its most popular provisions in force including:

  • The provision, already active, that lets children stay on their parents’ plans until age 26.
  • The provision, already active, that prohibits insurers from denying coverage to children.
  • The provision that prohibits insurers from denying coverage to adults with pre-existing conditions, starting January 1st, 2014.

Romney is likely to get rid of the requirement that Americans purchase health insurance or be charged a tax penalty of up to $1200, starting in 2016.  If he does this then we can fully expect the guarantee issue health insurance to be quite costly, as we will have fewer young healthy people paying into the insurance plans.

Romney favors most people owning their own health insurance rather than rely on their employers for coverage, a notion which is supported by many notable economists.

It’s unclear if the provision for state-run insurance exchanges to sell standardized plans would survive.

Gene Zaino, CEO of small business service provider MBO Partners, said his discussions with insurance companies and brokers suggest that insurance provided through the exchanges will be expensive, because those seeking coverage through them will be the sickest and most costly to insure.  That makes sense unless masses of people buy policies through the exchanges.

However, if lower cost guarantee issue options exist outside the exchanges, then most people who aren’t eligible for subsidies will end up buying insurance as they do today.

Source: Wall Street Journal Marketwatch

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