U.S. Representative Mike Coffman (R-CO) announced today that he has introduced H.R. 3812, the No Bailouts for Insurance Industry Act of 2014 that will amend the Affordable Care Act, better known as Obamacare, to prohibit a potential bailout for the insurance industry that is currently authorized under Section 1341 and Section 1342 of the Affordable Care Act.
“The American people have had enough of big bailouts for big business and it’s time for this culture of corporate cronyism that has become a dominant part of Washington, D.C. to stop,” said Coffman.
Coffman’s legislation, H.R. 3812, the No Bailouts for Insurance Industry Act of 2014 would amend the Affordable Care Act to repeal Section 1341, the “reinsurance” fund, and Section 1342, the “risk corridor” provision. Together, both could provide for a massive taxpayer bailout to cover the losses of a large insurance company. Coffman is concerned that Obamacare is based on signing up a sufficient number of younger, healthier people for insurance through the exchanges - at a much higher premium cost - in order to shift the cost away from an older population that is expected to sign up for health insurance through the exchanges. If the young don’t sign up in sufficient number, and Coffman doesn’t think they will, then he sees the cost of Obamacare spiraling out of control and the insurance industry suffering significant losses.
“The taxpayers should not be on the hook for the failures of Obamacare. Any reasonable person can see that this scheme isn’t going to work and Americans should not be forced to bail it out once it fails,” said Coffman.