This post was originally posted in April, 2017. Given the recent events around insurance crossing state lines, perhaps we should re-visit my IDC blog on this topic
Despite all the ballyhoo on March 24 when lawmakers did not submit a bill to the House of Representatives, reform of the Affordable Care Act (ACA) is not over. Republican lawmakers in the Congress will most likely again bring up an overhaul of the ACA, and one of the most mentioned items in that reform is making it possible for insurance companies to sell health coverage policies across state lines. Republicans and President Trump have a history of indicating this preference.
Selling insurance across state lines is an old idea that is highly tied to Essential Minimum Benefits scope and regulation. It could encourage state-based cherry picking, and confuses pricing and regulation. At the operational and state level, it is hard to find someone who likes the concept after you scrape off the veneer.
This concept makes sense to some around the Washington beltway who see Maryland, Virginia, and Washington, D.C., as one big megalopolis around that beltway or at Harvard where people routinely live in other small neighboring New England border states. Unfortunately, the country isn't a homogenous beltway nor an academic small-state border construct and selling across state lines has significant states' rights and technological challenges.
My new IDC Perspective identifies the feasibility of this proposal and specifies the operational challenges for front-, middle-, and back-office functions inside a payer when it comes to selling insurance across state lines.