Senior HHS Official Talks of Employers “Dumping” Health Coverage
In case you hadn’t seen it, The Hill reported on comments made by Joel Ario, head of the health insurance Exchange office within HHS, about the idea of employers dropping coverage once the Exchanges come online in 2014. While Mr. Ario argued that employers would not drop coverage initially, he stated that if “the Exchanges work pretty well, then the employer can say ‘This is a great thing. I can now dump my people into the Exchange and it would be good for them, good for me.’”
Losing their current coverage may not be good for employees – it definitely wasn’t what the President promised when he promised that “you will not have to change plans.” Just as important, however, the law’s supposed deficit reduction stems entirely from the premise that most employers will NOT drop their current plans – so if companies follow Mr. Ario’s advice and “dump [their] people into the Exchange,” it would assuredly NOT be good for taxpayers. As former Congressional Budget Office Director Doug Holtz-Eakin’s analysis confirms, should employers decide to drop coverage, the cost of federal insurance subsidies will explode as employers shed their plans – making any promise of deficit reduction as a result of the law little more than a mirage. (For what it’s worth, the HR Policy Association, where Mr. Ario spoke this morning, submitted comments indicating “we believe…Congress may have significantly underestimated the shift to Exchange-based care that will result from the new law.”)
Last March, Speaker Pelosi famously said we had to pass the bill to find out what’s in it. Mr. Ario’s comments – implying individuals could lose their current coverage, AND taxpayers will have to finance trillions of dollars in additional subsidy payments – provide yet another example of why the former Speaker’s comments continue to ring true.