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It's Not Not an Option

July 16, 2009 - by Donny Shaw

This editorial from Business Investor’s Daily, which I noticed this morning but basically dismissed, is actually beginning to have some impact in the blogs. It’s the top item on Memeorandum right now, for example. The editorial reads, in part:

It’s Not An Option

It didn’t take long to run into an “uh-oh” moment when reading the House’s “health care for all Americans” bill. Right there on Page 16 is a provision making individual private medical insurance illegal.

When we first saw the paragraph Tuesday, just after the 1,018-page document was released, we thought we surely must be misreading it. So we sought help from the House Ways and Means Committee.

It turns out we were right: The provision would indeed outlaw individual private coverage. Under the Orwellian header of “Protecting The Choice To Keep Current Coverage,” the “Limitation On New Enrollment” section of the bill clearly states:

“Except as provided in this paragraph, the individual health insurance issuer offering such coverage does not enroll any individual in such coverage if the first effective date of coverage is on or after the first day” of the year the legislation becomes law.

So we can all keep our coverage, just as promised — with, of course, exceptions: Those who currently have private individual coverage won’t be able to change it. Nor will those who leave a company to work for themselves be free to buy individual plans from private carriers.

The paragraph of the bill they are referencing is here. Read alone, it does sound a lot like how they interpret it. But if you read down a little further in the bill or have a broader understanding of the various mechanisms in the bill, it’s clear that this is setting up a distinction between existing private plans, which are grandfathered, and new plans – private and public – which will have to be a part of the Health Insurance Exchange set up under the bill. A little further down in the bill, you can read:

(1) IN GENERAL- Individual health insurance coverage that is not grandfathered health insurance coverage under subsection (a) may only be offered on or after the first day of Y1 as an Exchange-participating health benefits plan.

An astute reader at Instapundit was quick to point this out.

So what is the Health Insurance Exchange that new plans will have to participate in? You can read about it in the bill here, or in the committee summary:

The new Health Insurance Exchange creates a transparent and functional marketplace for individuals and small employers to comparison shop among private and public insurers. It works with state insurance departments to set and enforce insurance reforms and consumer protections, facilitates enrollment, and administers affordability credits to help low- and middle-income individuals and families purchase insurance. Over time, the Exchange will be opened to additional employers as another choice for covering their employees. States may opt to operate the Exchange in lieu of the national Exchange provided they follow the federal rules.

According to the bill text, the Exchange will be made available to the public through a telephone hotline and a website, which, the bill stipulates, must be written in plain text.

The broader lesson here is that the public (and Congress) needs time to have these discussions and to figure out what’s in the bill. These discussions are invaluable for actually building public knowledge about bills and how they work. They also provide the basis for a healthy democracy. The more they are allowed to flourish, the better off we all are. Paul Blumenthal has more on the health care bill’s timeline and its implications for transparency.

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