New Jersey leads the nation in so many important things: rest stops named for historical figures, willingness to wear track suits in public — and now, reconstituting the Affordable Care Act under President Trump.
No state has moved faster or more aggressively to shore up its ACA markets than Jersey.
- Yesterday, the Trump administration approved the state’s proposal for a new, five-year reinsurance program — essentially a subsidy that helps insurers pay for their most expensive customers, so they don’t have to pass those costs on through higher premiums.
- That program will be paid for, in part, by New Jersey’s newly enacted individual mandate.
- New Jersey also bans short-term insurance plans that don’t cover pre-existing conditions. The Trump administration has loosened the rules for those plans, but states are free to enact their own restrictions.
Those three policies — an individual mandate, a reinsurance program and limits on short-term plans — are states’ most muscular options for stabilizing their individual insurance markets, especially if they want to stick to the same core model of the pre-Trump ACA.
- Right now, Jersey is the only state that has all three.
Meanwhile: The California State Assembly passed a bill yesterday to ban short-term plans.
The big picture: As more states — mostly blue states — restrict short-term plans and win approval for reinsurance programs, expect to see a deepening red-blue divide in state insurance markets and, as a result, in average premiums within the ACA’s exchanges.