Policy

Legislator Hopes to "Correct" the Health Insurance Market In Order to Fix a Problem Introduced by a Previous Attempt to Correct the Health Insurance Market

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The New York Times reports on a casualty of ObamaCare: new, child-only health insurance policies.

Insurers in Texas and across the nation — protesting a provision of the 2010 federal health care overhaul that prohibits pre-existing condition limitations for children under 19, have simply stopped offering new child-only policies. For children being raised by their grandparents, who are not poor enough to qualify for Medicaid and have no employer-offered insurance or family plans to cover them, there are few options.

…Jared Wolfe, executive director of the Texas Association of Health Plans, said it is not because insurers do not want to cover children. The federal health care overhaul, and in particular the pre-existing condition language, has been interpreted to mean that insurers must write a policy for any child who applies, Mr. Wolfe said. That effectively ensures that only sick children will apply for benefits, he said — an unworkable financial scenario for insurance companies.

"It's a bad situation," Mr. Wolfe said. The child-only plans "are a very small percentage of the market, but for those people, it means quite a bit."

One Democratic legislator from Texas has apparently filed a bill that would force insurers to accept child applicants if they sell health insurance on the individual market. "We have to correct the market to make sure children don't go without coverage," he's reported as saying. Hold on a minute. Wasn't ObamaCare passed as a corrective measure intended to fix problems within the individual market? And weren't those flaws created in large part by policies that favored employer-sponsored insurance? 

This story provides a neat illustration of the endless cycle of regulatory do-gooderism: First, legislators pass a law that's supposed to fix the problems in a market. Then, at little while later, they notice that their shiny new law has actually created additional problems. Finally, they start the process of passing an even newer law to fix the problems caused by the regulations set up in the first one. From there, they wait until new problems inevitably arise and then start all over again. I suppose it keeps them busy. 

More on ObamaCare and the disappearance of child-only health insurance policies here.