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Johnson Holds Obama Care Hearing, Calls For Allowing Subsides Outside Of Marketplace

Affordable Care Act Exchange Losing Insurers, Leaving Consumers With Few Choices

Scott Bauer/AP Photo

U.S. Sen. Ron Johnson, R-Wisconsin, wants to allow people to use government subsidies to buy health insurance outside of Obamacare. The federal marketplace that’s part of the Affordable Care Act has fewer insurers, meaning consumers could face higher prices.

Johnson said subsidies will give consumers more choice in areas of the country where insurance companies no longer sell on the marketplace because they can’t make money.

“Why don’t we allow individuals to take that subsidy and use that for any non-Obamacare plans? Also, let’s eliminate the individual mandate so no one’s being penalized,” Johnson said.

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Wisconsin’s Deputy Insurance Commissioner, J.P. Wieske, estimated 64,000 states residents getting insurance on the federal exchange could lose their coverage because insurers pulled out or service areas changed. Wieske testified before the Senate Homeland Security and Governmental Affairs Committee, which Johnson chairs, in Washington, D.C., on Thursday. The Obama administration plans to auto-enroll these consumers in other plans so they stay covered. Wieske claims this is illegal under state law.

Johnson and six other Republican colleagues are cosponsoring a bill from U.S. Sen. Lamar Alexander, R-Tennessee, that would let subsides be used outside the marketplace. Nationwide, it’s estimated that up to a third of counties around the country will have no competition on the marketplace. But Citizen Action Executive Director Robert Kraig said the proposal undermines one goal of health reform: to provide comprehensive coverage.

“If you allow people to buy insurance off the exchange and get the subsidies, that opens up the possibility of substandard lemon plans where people think they have health insurance but when they actually need it they end up in medical bankruptcy,” Kraig said.

Citizen Action of Wisconsin estimates four of Wisconsin’s 72 counties (Menominee, Pierce, St. Croix and Polk) will have only one insurer in 2017.