We’ve talked about the Copper plans being proposed by Senator Begich (D-Alaska) and others earlier this year. The basic thrust of the policy is the following:
Right now, minimal essential coverage for people over the age of 29 and those not facing a hardship is a Bronze plan. That plan covers 60% of the average expected acturial cost. All Bronze, Silver, Gold and Platinum policyholders from a single company in a single state make up a unified risk pool. The metallic band plans are subsidized by tax credits. Minimal essential coverage for people 29 and younger is catastrophic coverage which covers less than 50% of the expected acturial cost. Catastrophic coverage has its own seperate risk pool and is non-subsidized.
The copper plan would be a redefinition of essential minimum coverage for most people from 60% actuarial value to 50%. This is a 16% decrease in expected coverage value, and it is getting insurance to the point where it is truly hit by the bus coverage. The 16% decrease in coverage will probably lead to an 18% to 20% decrease in premium pricing if the pricing differentials between the same insurer/same plan design Bronze-Silver-Gold-Platinum hold up. To get that decrease in actuarial value, the maximum out of pocket levels will increase from the current $6,350 to between $8,000 and $10,000. It is a trade-off between lower guaranteed monthly payments and the possibility of much higher oh-shit payments. That is a legitimate trade-off for insurance.
Erik Loomis, at Lawyers Guns and Money, in service of making the larger and correct point that there was never 51 votes in the 2009-2010 Senate as it was for high acturial coverage, low monthly premium insurance for all or at least all citizens and permanent aliens, points out the Copper plan as evidence that there is a significant caucus for making insurance worse. However he makes a point that I think needs significant modification.
“a significant percentage of the Democratic caucus is looking to fix the ACA by making it a lot worse for poor people. “
We need to divide the analytical universe into three segments. I think only one segment would be significantly worse off, one would be in a series of trade-offs in a larger option space, and the third would be untouched.
Let’s get to the easy one first.