Georgia health insurance bill would let residents buy out-of-state coverage

Jill Overmyer

If you live in Georgia and find an affordable health insurance policy in another state, can you buy it? Soon, you might be able to. In April 2011, the Georgia House and Senate passed a bill, HB 47, which would allow Georgia residents to buy health insurance policies from other states.

Georgia health insurance bill would let residents buy out-of-state coverage
Georgia health insurance bill would let residents buy out-of-state coverage

H.B. 47 basics

Traditionally, buying health insurance across state lines has not been possible. States have widely varying laws regarding what insurers have to cover. Requiring an insurer to register with each state in which it does business guarantees that it’s in compliance with all the state’s laws.

If Georgia Go. Nathan Deal signs H.B. 47 into law, insurance companies, previously bound by Georgia’s insurance requirements, would be allowed to sell out-of-state policies to Georgia residents. Insurers would still be required to be licensed in Georgia, according to the Georgia House of Representatives. But they could sell policies meant for other states.

Pros and cons of out-of-state insurance

Selling insurance across state lines has been a politically charged topic for years, and lawmakers and politicians have debated the pros and cons of introducing it on a national level.

According to Kaiser Health News, those who oppose cross-state health insurance worry that:

  • Consumers will shop for policies based on price and not on coverage. That means Georgia residents who buy out-of-state policies could find themselves unprotected in certain events or faced with staggering medical bills for procedures that a more expensive Georgia-based policy would have covered.
  • Resolving insurance disputes across state lines may be problematic for consumers and insurance companies.
  • Insurance pools would be unbalanced. If healthier people have the option to buy less expensive coverage from another state, the in-state insurance pool would contain only the sick.

Those who support cross-state insurance argue that:

  • Rates for uninsured people will decrease. According to the bill, Georgia has a high number of uninsured residents because many can’t afford coverage. Some out-of-state plans might be cheaper for them.
  • The market will become more competitive. According to Kaiser Health News, proponents of selling insurance across state lines contend that strict state regulation of policies leaves fewer options in the marketplace and allows overpriced policies to survive. Cross-state insurance would create a more competitive market, as the ability to shop around would boost affordability.
  • Consumers will have more options. When the market is dominated by only a few insurance providers, consumers have few choices and little leverage. Allowing out-of-state policies might let customers find coverage and health insurance companies that fit their needs.

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