Maryland considers individual mandate replacement

State lawmakers in Maryland have proposed an alternative means to encourage people to maintain health insurance following the repeal of the Affordable Care Act’s individual mandate through the Republican-supported tax cut legislation.

The legislation is being labeled a “down payment plan.” Marylanders would have the option, beginning in 2020 of putting the money they would pay as a fine for not having insurance towards an insurance plan on the ACA exchanges. If they can receive coverage at no cost because of the ACA’s premium support subsidies, they will be automatically enrolled in a plan. The proposal said there are currently 200,000 residents who would qualify for subsidized exchange plans but haven’t signed up.

If no zero-cost plan is found, the payment will remain in an interest-bearing escrow account which can be utilized to purchase insurance during the next open enrollment period. If the money remains unused for too long, however, it will go into a statewide “health insurance stabilization fund.”

The bill will be introduced by Maryland state Sen. Brian Feldman and Delegate Joseline Pena-Melnyk, both Democrats and co-chairs of the Maryland Health Insurance Coverage Protection Commission.

“The Affordable Care Act has been a great success in Maryland and we need to protect it from President Trump and Congress,” Vincent DeMarco, president of the Maryland Citizens’ Health Initiative, which is backing the legislation, said in a press release. “With this new health insurance down payment plan, our state can build on this success to stabilize our insurance market and help even more Marylanders get the care they need at a price they can afford.”

Other states are expected to take up their own insurance requirements now that the mandate has been repealed. The Congressional Budget Office estimated that between 2019, when the mandate is no longer in effect, and 2027, 13 million fewer people will be insured and insurance premiums will rise by 10 percent as healthier customers leave the ACA risk pool.