State insurance officials pleaded with senators on Wednesday to quickly act to stabilize the ObamaCare markets, calling for a multiyear extension of key payments to help fund premiums for low-income customers.
Congress must pass a fix by the end of September to shore up the wobbly individual markets, several officials said, in particular funding for key ObamaCare insurer payments known as cost-sharing reductions (CSR).
“The CSR funding issue is the single most critical issue that you can address to help stabilize insurance markets for 2018 and potentially bring down costs,” Tennessee’s insurance commissioner Julie Mix McPeak told the Senate Health Committee.
The panel kicked off a series of hearings Wednesday on stabilizing the markets. If Congress can pass a bill, it would represent the biggest bipartisan update since President Obama signed the law in 2010.
Health committee Chairman Lamar Alexander (R-Tenn.) wants to find consensus by the end of next week. To sell the fix, he and ranking member Patty Murray (D-Wash.) held a private meeting with senators not on the committee and the witnesses who testified as Wednesday’s hearing.
“If we can do two things, that would be two more things that we have agreed on in a bipartisan way in the last seven years in health insurance,” Alexander told reporters.
“And then let the leaders see if we can pass it, and hope the House does and that the president signs it.”
Despite some pushback that could still come from conservatives calling the payments an “insurer bailout,” Alexander and Murray hope to cobble together a bipartisan group that agree some continuation of the payments is necessary.
The cost sharing subsidies, which reimburse insurers for giving discounted deductibles and co-pays to low-income customers, have been made by the Trump administration on a month-to-month basis.
Republicans had sued the Obama administration over the payments, calling them unconstitutional, but many have since acknowledged they need to continue at least in the near term to prevent steep premium hikes.
Insurers have asked for long-term certainty on the payments, threatening to hike premiums and leave the ObamaCare markets altogether if they don’t get it.
Democrats, and some Republicans like Alexander, agree Congress should fund the payments, but there’s disagreement on the time frame.
Alexander wants to fund the payments through 2018 while Murray has pushed for multiple years.
“It is critical that we work toward a multiyear solution in order to provide the kind of certainty that will have the most impact on families’ premiums and choices in the marketplaces,” Murray said.
America’s Health Insurance Plans, the nation’s largest insurer trade association, and other stakeholder groups urged Congress to fund the payments through at least 2019.
“Without two years of CSR funding, uncertainty will persist and the Congress will need to address these same issues early next year,” the groups wrote in a letter to the committee Tuesday.
Meanwhile, Republicans say a bipartisan health bill must include changes to ObamaCare’s state waivers so states have more control over what their insurance plans look like.
Alexander said ObamaCare’s waivers should be amended so “states can have more flexibility to devise ways to provide more coverage with more choices and lower costs.”
“It just hasn’t been very appealing to states because it is a difficult tool to use,” he said.
This point was echoed by Pennsylvania’s insurance commissioner Theresa Miller, who called the process to get approved cumbersome.
“Baseline coverage requirements should be kept intact as much as possible … but make it easier for states to respond to market issues,” she said.
For example, it takes at least six months to get a waiver approved with the federal government, which the commissioners said made it difficult to quickly respond to market issues.
But Democrats have been wary of anything they say could result in coverage losses and the availability of less comprehensive insurance plans.
The Senate GOP’s ObamaCare repeal plan, which failed in a dramatic vote with Sen. John McCain (R-Ariz.) joining two other Republicans in opposition, contained language intended to make it easier for states to approve less comprehensive plans.
However, Democrats say that is going in the wrong direction.
We should be “moving forward not backward on affordability, coverage and quality of care,” Murray said.
“We’re all well aware threading this needle won’t be easy,” she said, “but I do believe an agreement that protects patients and families from higher costs and uncertainty, and maintains the guardrails in our current health care system, is possible.”
Several commissioners also recommended setting up a temporary reinsurance program to help insurers with high cost patients with the intent of lowering premiums for healthier ones.
“Congress should enact a federal reinsurance program with a minimum duration of three years,” said Washington state insurance commissioner Mike Kreidler, adding that it would “significantly help stabilize the individual health insurance market.”
But Alexander indicated it’s unlikely for the bill to include reinsurance funding, noting that the U.S. is already trillions in debt.
“If a reinsurance program is such a good idea … why don’t states do it?” he asked, suggesting states impose small fees on every insurance plan sold to help fund it.
Democrats are also pushing for a bill to restore ObamaCare outreach funding after the Trump administration announced drastic cuts to the program.
Alaska’s insurance director Lori Wing-Heier said the cuts concern her because “these programs reduce the number of uninsured citizens and maximize public participation.”