Butch Otter's scheme was so ridiculous that even the Trump administration admitted it was illegal.
C.L. “Butch” Otter, the Republican governor of Idaho, thought he had a perfect plan to kill Obamacare: Just let insurers stop complying with it.
But his plan was so extreme, even Trump’s rabidly anti-Obamacare health officials had to intervene and stop him.
Two months ago, Otter signed an executive order directing insurance regulators to allow plans outside the health marketplaces with essentially no restrictions. Blue Cross of Idaho quickly submitted a line of “Freedom Blue” plans that exclude maternity care, overcharge elderly patients, and include lifetime benefit limits and surcharges for preexisting conditions.
Moreover, Otter did not bother to seek approval from the Department of Health and Human Services before moving forward. Idaho Sen. Jim Risch summed up his state GOP’s position succinctly: “We’re a state. We don’t need approval. Get out of here.”
But as it turned out, Idaho overreached.
On Thursday, Trump’s Medicare and Medicaid director Seema Verma grudgingly sent Otter notice that his scheme is illegal. If he moves forward, insurance companies selling these plans will face steep federal fines.
The Trump administration is still implementing other plans to sabotage Obamacare, from allowing short-term junk insurance, to legally dubious Medicaid work requirements. A study from Covered California found Trump’s sabotage will raise the cost of insurance up to 94 percent in some states over the next 3 years.
But the rejection of Idaho’s scheme to kill Obamacare rules is a major win for consumers. Had these illegal plans been allowed, young, healthy people would have abandoned the legal insurance marketplace to buy them, spiking costs for everyone else.
And letting Idaho nullify Obamacare within its borders would have set a precedent. Idaho insurance director Dean Cameron said “dozens” of other Republican states were preparing to copy their system.
Any way you slice it, Otter’s plan to deprive his own people of care has crashed and burned. And the people of Idaho, and around the country, have one less thing to worry about when it comes to health care.