Wyoming Liberty Group
Last week I announced on this blog our plan to support legislation that will allow Wyoming health insurance providers to sell policies that their company or affiliates sell in other states. Thankfully, so far this idea has been well received. But some question why Wyoming needs to pass this law: didn’t the Legislature pass an interstate compacts bill just two years ago that allows Wyoming to join with other states for the interstate sale of health insurance?
This fall, the Wyoming Liberty Group is supporting legislation for the 2012 Budget Session that will allow health insurers that have a business presence in Wyoming to sell individual and small group health insurance policies that they sell in other states. The bill is quickly garnering bipartisan interest.
Today the Wyoming Health Benefit Exchange Steering Committee meets in Casper to continue discussing whether Wyoming should implement its own health insurance exchange or allow the federal government to implement a regional exchange that would include our state. This committee was established in the wake of the Patient Protection and Affordable Care Act (a.k.a. ObamaCare), which requires states to choose one of these two options. Exchanges are websites that will, in theory, allow people to pick among insurance policies that suit their needs and thereby encourage competition among insurance providers. However, since the available policies must all provide coverage that the federal government requires (including drug and alcohol abuse), exchanges are far from an open market.
Last Friday, Georgia governor Sonny Perdue signed Act 249 into law. This new law “allow[s] insurers authorized to transact insurance in Georgia to issue individual accident and sickness policies in Georgia that [are] currently approved for issuance in another state.” In other words, a Georgia insurer who sells a policy another state can now sell the same policy in Georgia without making it conform to Georgia’s coverage requirements. This means that anyone who purchases that policy will be part of the same insurance pool as those who hold the policy outside of Georgia. When it comes to insurance, the general rule is the bigger the pool, the cheaper the policy (that is, the ability to spread the risk). The same policy can now be sold in one state and in Georgia, increasing the customer base for that policy by 10 million people. This may lead to bigger pools and cheaper policies.