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Washington D.C. -- Instead of improving the bill as supporters claim, an amended version of S. 1955 introduced yesterday would actually require insurance companies to charge patients at least 500% more for the same coverage.

The amended bill would also require insurers to charge more based on age and health even though such discrimination is currently illegal in many states, according to the nonprofit, nonpartisan Foundation for Taxpayer and Consumer Rights (FTCR). A cloture vote on the junk health insurance plan, introduced by Senator Michael Enzi (R-WY), is expected this afternoon.

"In the face of public outcry over this attack on state patient protections, the new Enzi bill legally requires insurers to ignore those very protections," said FTCR's Carmen Balber.

Read Georgetown University Associate Research Professor Mila Kofman's analysis of the bill's impact on state insurance rating protections: http://www.consumerwatchdog.org/resources/kofmanletterrates.pdf.

The manager's amendment introduced yesterday:

  • Requires states to allow at least a 500% variation in rates.
  • Pre-empts state community rating rules that don't allow insurers to charge patients more based on their health status.
  • Excludes association health plans from the rest of the small market insurance pool, meaning each association would be rated on its own. This increases the ability of insurance companies to cherry-pick the young and healthy and push up premiums for everyone else.
  • Allows insurers to vary rates based on far more factors than allowed in community rating states, including: age, duration of coverage, claims experience, health status, industry, geographic area, group size, participation rate and participation in wellness programs.
  • Pre-empts state rules about how insurers vary rates based on geography of geographic rating bands that prevent the redlining of neighborhoods that insurers could otherwise deem "undesirable."

"The manager's amendment does not fix the problems with the bill's rating structure," said Mila Kofman. "The bill would still deprive consumers of existing state rating protections."

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