Tag Archives: Health Insurance Exchanges

What’s the Near-Term Outlook for the Affordable Care Act?

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http://www.kff.org/health-reform/issue-brief/whats-the-near-term-outlook-for-the-affordable-care-act/?utm_campaign=KFF-2017-August-Health-Reform-Outlook-ACA&utm_medium=email&_hsenc=p2ANqtz–oP5wlywrzGCg7hZVAatEjF0shnUXWvPMPB7MBQfAJJXiDqeMCZIkw7rhXhhVQ7bv4RTl4IFWk3zbvJFTnYv730hVqBQ&_hsmi=54950542&utm_content=54950542&utm_source=hs_email&hsCtaTracking=b35f36e5-60c0-4e14-ba27-3e14c4025b79%7Cf0a0cb87-2715-4168-b499-2000076067bf

If Congress abandons efforts to repeal and replace the Affordable Care Act (ACA), President Trump has said he would “let Obamacare fail.” This Q&A examines what could happen if the Affordable Care Act, also called “Obamacare,” remains the law and what it might mean to let Obamacare fail.

Is Obamacare failing?

The Affordable Care Act was a major piece of legislation that affects virtually all payers in the U.S. health system, including Medicaid, Medicare, employer-sponsored insurance, and coverage people buy on their own. One of the biggest changes under the health reform law was the expansion of the Medicaid program, which now covers nearly 75 million people, about 14 million of whom are signed up under the expansion. Most Americans, including most Republicans, believe the Medicaid program is working well.

When people talk about the idea of the ACA failing, they are usually referring to the exchange markets, also called Marketplaces. These markets, which first opened in 2014, are part of the broader individual insurance market where just 5-7% of the U.S. population gets their insurance. People who get insurance from other sources like their work or Medicaid are not directly affected by what happens in the individual insurance market.

The exchange markets have not been without problems: There have been some notable exits by insurance companies and premium increases going into 2017, and in the early years of the exchanges, insurers were losing money. The structure of the ACA’s premium subsidies – which rise along with premiums and cap what consumers have to pay for a benchmark plans a percentage of their income – prevents the market from deteriorating into a “death spiral.” However, premiums could become unaffordable in some parts of the country for people with incomes in excess of 400% of the poverty level, who are ineligible for premium assistance.

Insurer participation in this market has received a great deal of attention, as about 1 in 3 counties – primarily rural areas – have only one insurer on exchange. Rural counties have historically had limited competition even before the ACA, but data now available because of the Affordable Care Act brings the urban/rural divide into sharper focus. On average at the state level, competition in the individual market has been relatively stable – neither improving nor worsening.

Premiums in the reformed individual market started out relatively low and remained low in the first few years – about 12% lower than the Congressional Budget Office had projected as of 2016 –before increasing more rapidly in 2017. Most (83%) of the 12 million people buying their own coverage on the exchange receive subsidies and therefore are not as affected by the premium increases, but many of the approximately 9 million people buying off-exchange may have difficulty affording coverage, despite having higher incomes. As might be expected, after taking into account financial assistance and protections for people with pre-existing conditions, some people ended up paying more and others paying less than they did before the ACA. Our early polling in this market found that people in this market were nearly evenly split between paying more and paying less. About 3 millionpeople who remain uninsured are not eligible for assistance or employer coverage and many of them may be going without coverage due to costs.

Our recent analysis of first quarter 2017 insurer financial results finds that the market is not showing signs of collapse. Rather, insurers are on track to be profitable and the market appears to be stabilizing in the country overall. In other words, those premium increases going into 2017 may have been enough to make the market stable without discouraging too many healthy people from signing up. However, there are still markets – particularly rural ones – that are fragile.

U.S. governors urge Trump to make insurance payments

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https://www.reuters.com/article/us-usa-healthcare-idUSKBN1AI28L

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Democratic and Republican U.S. governors on Wednesday urged the Trump administration, as well as Congress, to continue funding payments to health insurance companies that make Obamacare plans affordable, calling it critical to stabilizing the insurance marketplace.

Republican President Donald Trump, frustrated that Obamacare survived attempts to repeal it, has threatened to cut off about $8 billion in subsidies that help control costs for low-income Americans under the Affordable Care Act, Democratic former President Barack Obama’s signature domestic initiative.

“The Administration has the opportunity to stabilize the health insurance market across our nation and ensure that our residents can continue to access affordable health care coverage,” said a statement by the Health and Human Services Committee of the National Governors Association.

“A first critical step … is to fully fund CSRs (cost-sharing reduction payments) for the remainder of calendar year 2017 through 2018,” the statement said, adding this was needed as Congress and the administration address long-term reform efforts.

The committee is led by Virginia Governor Terry McAuliffe, a Democrat, and Massachusetts Governor Charlie Baker, a Republican. Earlier this year, the governors sent a letter calling on Congress to fully fund the cost-sharing payments.

Some Congressional Republicans have joined Democrats in urging Trump to continue the payments. Republican Senator Lamar Alexander, chairman of the health committee, said Tuesday the president should pay the subsidies through September while lawmakers work on bipartisan legislation to fund the outlays for another year.

But the Senate’s No. 2 Republican John Cornyn hesitated when asked Wednesday if he would support such legislation.

“I’ve said before that I’m not in favor of throwing money at insurance companies without reform, so that’s going to be the nature of the conversation,” Cornyn told reporters outside his office.

Asked what reforms he’d like to see, Cornyn mentioned the “skinny” Obamacare repeal bill the Senate voted down last week. Among other things, it would have repealed the requirement that every American have health insurance or pay a penalty.

Insurers say that the cost-sharing payments are passed onto customers in the form of lower deductibles and co-pays that make care more affordable for low income Americans.

Insurers are finalizing 2018 premium rates for the individual Obamacare market, with many saying their decision hinges on government guarantees for cost-sharing subsidies.

Molina Healthcare Inc said on Wednesday it would stop selling Obamacare plans in Utah and Wisconsin, joining a slew of health insurers that have exited Obamacare markets amid uncertainty over the healthcare law.

Anthem Inc, one of the largest sellers of these plans in 2017, has pared back offerings or mostly exited five states including California and may exit more.

White House budget director Mick Mulvaney told CNN the administration was still considering whether to end cost-sharing subsidies.

 

Bipartisan drive to pay health insurers faces Senate hurdles

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http://abcnews.go.com/Health/wireStory/bipartisan-drive-pay-health-insurers-faces-senate-hurdles-48995691

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A bipartisan Senate effort to continue federal payments to insurers and avert a costly rattling of health insurance markets faces a dicey future. The uncertainty shows that last week’s wreck of the Republican drive to repeal the Affordable Care Act hasn’t blunted the issue’s sharp-edged politics.

President Donald Trump is threatening to halt the payments in hopes of forcing Democrats to negotiate an end to the Obama-era law. The insurance industry and lawmakers from both parties say blocking the money would lead insurers to raise premiums for people buying individual policies and might induce companies to abandon some markets.

Into the fray has stepped Sen. Lamar Alexander, R-Tenn., chairman of the Senate Health, Education, Labor and Pensions Committee.

He said he will work with the committee’s top Democrat, Sen. Patty Murray of Washington state, on a bill next month that would pay insurers through 2018. In exchange, he wants Democrats to agree to make it easier for states to choose their own health coverage standards that insurers must provide, and not heed consumer-friendly requirements of former President Barack Obama’s law.

While that is an idea Democrats say they will discuss, it’s unclear whether the two parties can reach a deal.

For the GOP’s failed effort to repeal and replace Obama’s overhaul, Senate Republicans used special rules allowing passage by a simple majority. But this developing bill would need 60 votes to succeed. Republicans hold a 52-48 advantage in the Senate, which means Democratic backing will be crucial.

Democrats will be reluctant to strike an agreement that would pull back far on Obama’s protections, which include a set of services insurers must cover and guarantees that premiums for healthy and seriously ill people are equal.

“It’s going to be hard to get common ground,” said Sen. Chris Murphy, D-Conn., a committee member. “Republicans are going to want some initial flexibility” for coverage requirements, “and that’s not an easy thing to achieve.”

Republicans are divided, too.

Many, including Trump, have called the payments an insurers’ bailout. Conservatives are reluctant to continue payments to help sustain a law the GOP has pledged for years to toss out.

“I was a total repeal guy,” said Sen. Richard Shelby, R-Ala. “I don’t know if I want to prop it up.”

Added GOP Sen. Ted Cruz of Texas: “I think it’s a mistake to bail out insurance companies.”

Obama’s law requires insurers to reduce out-of-pocket costs such as deductibles and copayments for millions of low- and middle-income customers. It also requires the government to reimburse insurers for those costs.

But a federal court found that Congress hasn’t properly approved money to do that. Both Obama and Trump have continued making the payments as the case has dragged on.

Besides the outright opponents, some Republicans say they would be reluctant to support an Alexander bill unless whatever eased regulations Democrats agree to are worthwhile. It’s unclear what Alexander or other Republicans are willing to accept.

“We certainly should get some structural change to bring down premiums in exchange for that,” said Sen. Ron Johnson, R-Wis. “We can’t just throw money at the problem.”

That echoes what Senate Majority Leader Mitch McConnell, R-Ky., said last Friday after the Senate rejected the third health proposal he advanced, effectively sinking the repeal effort.

“Bailing out insurance companies with no thought of any kind of reform is not something I want to be part of,” McConnell said.

Alexander said Wednesday that he has kept McConnell apprised of his effort. Asked if he had received a commitment that McConnell would bring such legislation to the full Senate, Alexander said, “Well, he doesn’t know what bill we’re going to have.”

But Alexander does have allies.

“We’ll eventually repeal Obamacare and put something in its place,” said Sen. John Kennedy, R-La. “In the meantime, I think it’s very important not to see any Americans get hurt.”

If the GOP divisions persist, McConnell and House Speaker Paul Ryan, R-Wis., might have to decide whether to have votes on legislation opposed by substantial numbers of Republicans. That’s always an uncomfortable proposition for party leaders.

“That’s a question for McConnell,” said the second-ranking Democratic senator, Illinois’ Dick Durbin, said asked whether he thought the GOP leader would allow a vote on a bill opposed by many Republicans.

Durbin said if Republicans are truly concerned about keeping insurance markets stable, “they have to do something.”

Would Ryan support a measure like Alexander’s?

The speaker “believes repeal and replace is the best course of action and that the Senate needs to act,” spokeswoman AshLee Strong said.

California, 16 other states pledge to defend Obamacare subsidies if Trump drops out of lawsuit

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http://www.sacbee.com/news/local/health-and-medicine/article165045532.html

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Now that California, 16 other states and the District of Columbia have been given legal standing in a critical court appeal, California Attorney General Xavier Becerra said Wednesday they will fight to preserve the federal funds that underpin their Obamacare health exchanges if the Trump administration bows out of the lawsuit.

“My team is ready to defend these (federal) subsidies in court,” Becerra said. “We’re going to do everything we can to work with whoever is interested, whether it’s the Trump administration or Congress, to make sure that we continue to provide people with affordable health care. … We’re not going to go back to the days when health care was for the healthy or the wealthy.”

In this legal case, Republicans in the U.S. House of Representatives filed suit in 2014 against then-Secretary of Health and Human Services Sylvia Burwell, asserting that she had overstepped her authority by appropriating billions of dollars to cover discounts that insurers were mandated to give low-income consumers under the Patient Protection and Affordable Care Act, commonly called Obamacare.

While the Affordable Care Act promised reimbursement for the discounts, it provided no mechanism to pay the so-called cost-sharing reductions. Last year, U.S. District Judge Rosemary M. Collyer ruled that, while Congress clearly authorized the program, it had not appropriated funds and thus it was unconstitutional to pay the subsidies. However, she put her decision on hold, pending appeal to the U.S. Court of Appeals for the District of Columbia Circuit.

The dean of the UC Davis School of Law, Kevin R. Johnson, said the states could argue that since Congress mandated the cost-sharing program, that body should be compelled to provide the funding that states and insurers need to make it work.

Becerra, a Democrat who represented the 34th congressional district from 2013 to 2017, said the states would argue that Congress did contemplate the cost-sharing subsidies. “I say that, not only as someone who will argue that in court, I say that as a former member of Congress who helped draft the legislation,” Becerra said.

Becerra said he and other attorneys general filed a motion to join the appeal in May because they thought the president wasn’t going to protect health insurance marketplaces such as Covered California. Before and after the U.S. Senate failed to pass legislation to repeal the Affordable Care Act, Trump has tweeted that he and the Republican leadership should “let Obamacare implode” and then broker a deal.

“You could smell it. You could read it in tweets,” Becerra said. “When we intervened in May, we saw no one was really standing up for the millions of American families that rely upon the Affordable Care Act insurance plans to be able to send their kids to doctors and believe that they could afford to have their child in a hospital. The record is replete with evidence that the Trump administration is not willing to defend the Affordable Care Act.”

The appeals court ruled Tuesday that the states had standing in the lawsuit. Becerra said his office will work in concert with attorneys general in New York, Connecticut, Delaware, Hawaii, Illinois, Iowa, Kentucky, Maryland, Massachusetts, Minnesota, New Mexico, North Carolina, Pennsylvania, Vermont, Virginia, and Washington, and the District of Columbia. Ten of the states are led by Democratic governors and seven by Republicans.

Because of ongoing uncertainty about the availability of federal funds, Covered California announced Tuesday that it was planning to impose a surcharge on premiums for those consumers whose copayments and deductibles qualified for the insurer discounts.

While the action sounds ominous for the 650,000 silver-tier policy holders it affects, it is actually a bit of creative accounting that protects them from seeing sharp increases in payments and ensures financial stability for insurers. The health law imposes a cap on out-of-pocket costs for those consumers, whose incomes cannot exceed 250 percent of the federal poverty level. Under the Affordable Care Act, the federal government must pick up costs once consumer spending hits that out-of-pocket ceiling.

The insurers still discount copayments and deductibles on a sliding scale linked to income, and the premiums provide enough funding to cover those discounts on the front end rather than after care is provided.

Peter Lee, executive director of Covered California, has said California will move forward with the plan if an annual appropriation is not made for cost-sharing reductions. All rate changes are subject to state regulatory approval.

“We hope that we do not need to implement this work-around that would cause unnecessary confusion and ultimately cost the federal government more than it would to continue to make the payments directly,” Lee said.

Trump administration pulls health law help in 18 cities

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https://apnews.com/3d3f7034713e4c1b904e003bf1ac6eb1/Trump-administration-pulls-health-law-help-in-18-cities

President Donald Trump’s administration has ended Affordable Care Act contracts that brought assistance into libraries, businesses and urban neighborhoods in 18 cities, meaning shoppers on the insurance exchanges will have fewer places to turn for help signing up for coverage.

Community groups say the move, announced to them by contractors last week, will make it even more difficult to enroll the uninsured and help people already covered re-enroll or shop for a new policy. That’s already a concern because of consumer confusion stemming from the political wrangling in Washington and a shorter enrollment period. People will have 45 days to shop for 2018 coverage, starting Nov. 1 and ending Dec. 15. In previous years, they had twice that much time.

Some see it as another attempt to undermine the health law’s marketplaces by a president who has suggested he should let “Obamacare” fail. The administration, earlier this year, pulled paid advertising for the sign-up website HealthCare.gov, prompting an inquiry by a federal inspector general into that decision and whether it hurt sign-ups.

Now insurers and advocates are concerned that the administration could further destabilize the marketplaces where people shop for coverage by not promoting them or not enforcing the mandate compelling people to get coverage. The administration has already threatened to withhold payments to insurers to help people afford care, which would prompt insurers to sharply increase prices.

“There’s a clear pattern of the administration trying to undermine and sabotage the Affordable Care Act,” said Elizabeth Hagan, associate director of coverage initiatives for the liberal advocacy group Families USA. “It’s not letting the law fail, it’s making the law fail.”

Two companies — McLean, Virginia-based Cognosante LLC and Falls Church, Virginia-based CSRA Inc. — will no longer help with the sign-ups following a decision by Centers for Medicare and Medicaid Services officials not to renew a final option year of the vendors’ contracts. The contracts, awarded in 2013, were never meant to be long term, said CMS spokeswoman Jane Norris in an email.

“These contracts were intended to help CMS provide temporary, in-person enrollment support during the early years” of the exchanges, Norris said. Other federally funded help with enrollment will continue, she said, including a year-round call center and grant-funded navigator programs. The existing program is “robust” and “we have the on-the-ground resources necessary” in key cities, Norris said.

But community advocates expected the vendors’ help for at least another year. “It has our heads spinning about how to meet the needs in communities,” said Inna Rubin of United Way of Metro Chicago, who helps run an Illinois health access coalition.

CSRA’s current $12.8 million contract expires Aug. 29. Cognosante’s $9.6 million contract expires the same date.

Together, they assisted 14,500 enrollments, far less than 1 percent of the 9.2 million people who signed up through HealthCare.gov, the insurance marketplace serving most states. But some advocates said the groups focused on the healthy, young adults needed to keep the insurance markets stable and prices down.

During the most recent open enrollment period, they operated in the Texas cities of Dallas, Houston, San Antonio, Austin, McAllen and El Paso; the Florida cities of Miami, Tampa and Orlando; Atlanta; northern New Jersey; Phoenix; Philadelphia; Indianapolis; New Orleans; Charlotte, North Carolina; Cleveland and Chicago.

The insurance exchanges, accessed by customers through the federal HealthCare.gov or state-run sites, are a way for people to compare and shop for insurance coverage. The health law included grant money for community organizations to train people to help consumers apply for coverage, answer questions and explain differences between the insurance policies offered.

In Illinois, CSRA hired about a dozen enrollment workers to supplement a small enrollment workforce already in the state, Rubin said. The company operated a storefront enrollment center in a Chicago neighborhood from November through April.

“It was a large room in a retail strip mall near public transit with stations set up where people could come in and sit down” with an enrollment worker, Rubin said.

CSRA spokesman Tom Doheny in an email said the company “is proud of the work we have accomplished under this contract.” He referred other questions to federal officials.

Cognosante worked on enrollment in nine cities in seven states, according to a June 6 post on the company’s website. The work included helping “more than 15,000 Texas consumers” and staffing locations “such as public libraries and local business offices.” A Cognosante spokeswoman referred questions to federal officials.

The health care debate in Congress has many consumers questioning whether “Obamacare” still exists, community advocates said.

“What is the goal of the Trump administration here? Is it to help people? Or to undermine the Affordable Care Act?” said Rob Restuccia, executive director of Boston-based Community Catalyst, a group trying to preserve the health care law.

 

Trump’s war of attrition against Obamacare

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http://www.politico.com/story/2017/07/21/trumps-war-of-attrition-against-obamacare-240777?utm_campaign=CHL%3A%20Daily%20Edition&utm_source=hs_email&utm_medium=email&utm_content=54498266&_hsenc=p2ANqtz-9ek2u9ksxXcgIEhuqarS0spfhGiKMzLANnn_6r5sJmtFLcRJplq-a0Zqexn1eqaf_s9_sbG_p8WdTzuQUliN0eqfaVBA&_hsmi=54498266

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The administration can do plenty to undermine the law even if Republicans are unable to repeal it.

Obamacare may escape another GOP repeal effort, but surviving a hostile administration could be a much tougher challenge.

If a last-ditch repeal effort fails in Congress next week, all indications are the Trump administration will continue chipping away at the Affordable Care Act — if not torching it outright.

President Donald Trump, who regularly says Obamacare is dead, has already taken steps to undermine the law even as the legislative battle over repeal drags on. His administration has slashed crucial advertising dollars, cut the enrollment window in half, and regularly pumps out anti-Obamacare videos and graphics — actions sure to reduce the number of people who sign up.

Trump has plenty of other options to roll back a program covering roughly 20 million Americans. Those include ending enforcement of the mandate to carry insurance, imposing work restrictions and nominal premiums on low-income adults who qualify for Obamacare’s Medicaid expansion and letting states relax the law’s robust coverage rules.

The man charged with the oversight of many of these decisions, Health and Human Services Secretary Tom Price, noted in his confirmation hearing that Obamacare grants him broad authority about how to enact it — powers that in his hands could be used to the scale back the law’s reach.

“Fourteen hundred and forty-two times the ACA said ‘the secretary shall’ or ‘the secretary may,’” Price noted in March.

One possible brake on the administration might be the pushback from some Republican governors and lawmakers who oppose letting insurance markets crumble on their watch — even as Trump insists voters will blame Democrats. After the Senate’s repeal effort appeared to unravel earlier this week, Sen. Lamar Alexander, chairman of a key health care committee, announced plans to hold hearings on stabilizing Obamacare’s shaky insurance marketplaces.

“The best next step is for both parties to come together and do what we can all agree on: fix our unstable insurance markets,” wrote 11 governors this week in a bipartisan letter led by John Kasich of Ohio and John Hickenlooper of Colorado.

However, there’s no sign that most Republicans in Washington are ready to drop their longtime vow to dismantle Obamacare, even with a planned Senate vote on repeal next week likely to fail.

The most devastating thing the administration could do to Obamacare is pull insurance subsidies, worth about $7 billion this year, that are paid to insurers to cover the out-of-pocket costs of low-income consumers. That could lead to an exodus of insurers from the Obamacare markets, send premiums soaring, and lead already wobbly markets in some states to collapse.

“We pay hundreds of millions of dollars a month in subsidy … and when those payments stop, it stops immediately,” Trump said in a meeting with Republican senators Wednesday. “It doesn’t take two years, three years, one year — it stops immediately.”

The Trump administration confirmed Wednesday it will make this month’s subsidy payments. However, insurers fear the administration could nix the subsidy at any time.

The other immediate concern for insurers is whether the administration will continue enforcing the individual mandate penalty for Americans who do not purchase insurance. Many saw Trump’s Day One executive order instructing agencies to weaken Obamacare as a green light for the IRS to stop enforcing the tax penalty for skipping coverage. So far, however, the mandate remains.

While the mandate has proven weaker than insurers had hoped to induce Americans — particularly the young and healthy — to purchase coverage, the industry still sees it as a key tool for keeping down costs and stabilizing the markets. Many are boosting premiums higher than planned due to fears Trump will no longer enforce it.

Signals that the mandate will no longer be enforced are sure to worry insurance companies whose participation in Obamacare’s marketplaces are key to making them function. Some major national and regional insurers have already said they will pull out of the marketplaces next year, with most citing uncertainty about the effort to roll back the law.

“If there are questions, if there are unknowns, [insurers] have to proceed conservatively,” said Ceci Connolly, CEO of the Alliance of Community Health Plans. “If they price on wishful thinking, they will come up short next year.”

Trump health officials have already shown a willingness to flex executive power to whack at the law.

Weeks after taking office, the Trump administration canceled $5 million in HealthCare.gov advertising in the final days of the previous enrollment season — a particularly crucial time for attracting young and healthy customers. On Wednesday, Trump’s HHS confirmed it will soon terminate two contracts for outreach programs designed to sign up people for insurance across the country.

“The contracts were never intended to be long term,” said Jane Norris, a spokeswoman for the Centers for Medicare & Medicaid Services, which oversees the law’s implementation.

The administration could also pare back federal funding for enrollment outreach programs. The Obama administration awarded $63 million in grants last September to help states bolster enrollment efforts, and another tranche of funding is supposed to be released by this fall. However, the administration hasn’t signaled whether it would continue this funding, and an appropriations bill advancing in the House would block dollars for the so-called navigator programs.

The next enrollment period starting Nov. 1 is looming. The Trump administration has already cut the sign-up period in half — to six weeks in the nearly 40 states using HealthCare.gov — worrying advocates that the shortened window will depress sign-up numbers.

In past enrollment seasons, the Obama administration rolled out a full-court marketing press, with top administration officials making media appearances to push enrollment. It’s hard to imagine Price and other top HHS officials making a similar effort after his department has trumpeted Obamacare’s struggles on a daily basis.

“They have to sign up millions of enrollees just to maintain the same amount of total enrollment,” said Larry Levitt of the nonpartisan Kaiser Family Foundation. “If there’s minimal outreach … there could be a big drop-off in enrollment.”

While the previous administration also took an active role in boosting insurer participation in the marketplaces, the Trump administration has taken a hands-off approach. There are no signs that HHS is looking to persuade insurers to sell coverage in the 40 counties that potentially won’t have any insurers selling Obamacare plans next year. Trump and administration officials often tout these “bare” counties as another sign of Obamacare’s flaws.

“40 counties in 3 states are currently projected by @CMSgov to have zero insurers on #Obamacare,” Price tweeted on Thursday.

HHS could also give red states much wider latitude to limit who can sign up for Medicaid. Arkansas, Arizona, Kentucky, Indiana, Maine and Wisconsin are among the states with Republican governors seeking federal permission to add work requirements or make able-bodied adult beneficiaries pay more for care. The Obama administration largely shunned similar requests because they would shrink enrollment.

At least one state is seeking the Trump administration’s permission to significantly overhaul Obamacare’s coverage rules in order to attract insurers back to its struggling marketplace. Iowa, which is at risk of having no insurer sell coverage statewide next year, wants to scrap Obamacare’s subsidies helping customers pay for premiums and medical bills and replace them with a limited tax credit. That could make lower-income and sick enrollees pay a lot more for coverage.

Iowa also wants to implement a single, standardized health insurance option instead of allowing insurers to sell a range of health plans as they now do under Obamacare. Finally, the state would create a reinsurance program meant to backstop insurers with particularly expensive customers, an idea pursued by Alaska, Minnesota, New Hampshire and other states.

At least one insurer said it would re-enter Iowa’s marketplace if the plan goes through. Though some Obamacare advocates have questioned whether Iowa can legally roll back Obamacare standards as the state has proposed, the Trump administration is expected to greenlight the plan.

Capitol Hill health bill drama is leaving Obamacare exchanges in limbo

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Capitol Hill health bill drama is leaving Obamacare exchanges in limbo

Question mark heap on table concept for confusion,

 

California’s Obamacare exchange scrubbed its annual rate announcement this week, the latest sign of how the ongoing political drama over the Affordable Care Act is roiling insurance markets nationwide.

The exchange, Covered California, might not wrap up negotiations with insurers and announce 2018 premiums for its 1.4 million customers until mid-August — about a month later than usual. Similar scenarios are playing out across the country as state officials and insurers demand clarity on health care rules and funding, with deadlines fast approaching for the start of open enrollment this fall.

“It’s insane,” said John Baackes, CEO of L.A. Care Health Plan, which has about 26,000 customers on the California exchange. “Here we are in the middle of July and we don’t even know what rules we will be operating under for open enrollment. It is not how you want to run a business.”

Consumers could face sharply higher premiums and fewer choices if more health insurers leave the insurance marketplaces due to lingering uncertainty. State and industry officials around the United States are concerned that the federal government could stop funding so-called cost-sharing subsidies that reduce out-of-pocket costs for low-income consumers. And they worry the Trump administration won’t enforce the individual mandate that requires people to purchase health coverage or pay a penalty.

Amid those concerns, there was a sense of relief Tuesday among many exchange officials and insurers after the U.S. Senate’s latest attempt to replace the Affordable Care Act failed.

Two large insurer trade groups bluntly warned last week that parts of the Senate plan were “unworkable” and could plunge the market into chaos. In a letter to the Senate, America’s Health Insurance Plans and the Blue Cross Blue Shield Association particularly objected to an amendment by Sen. Ted Cruz (R-Texas) that would have allowed insurers to sell bare-bones health plans to people who wanted cheaper premiums. That provision, the insurers said, would split the market between the healthy and the sick, driving up costs for people with pre-existing conditions.

However, the Republicans’ failure to pass that ACA replacement plan did not resolve questions swirling around the current health law.

Tuesday, President Donald Trump expressed disappointment at the outcome in the Senate, telling reporters, “We’ll let Obamacare fail and then the Democrats are going to come to us and they’re going to say, ‘How do we fix it?’”

Some Senate Republicans struck a more conciliatory tone, suggesting that lawmakers should work on a bipartisan measure that would help stabilize the individual insurance markets.

Sen. Lamar Alexander (R-Tenn.), chairman of the Senate Committee on Health, Education, Labor and Pensions, said he plans to hold hearings in the coming weeks on ways to shore up the individual insurance market. Lawmakers may look at creating a new stabilization fund that helps compensate insurers for higher-cost patients. Such a fund would be similar to one that existed during the first three years of the ACA exchanges.

Some insurance industry executives welcomed the talk of bipartisanship, but they said action must be taken quickly to resolve key issues affecting consumers.

“We are running out of time and we need a resolution on what we are charging for 2018,” said Gary Cohen, vice president of public affairs at Blue Shield of California in San Francisco, the largest Covered California insurer by enrollment.

Cohen, who helped launch the exchanges in 2014 as an official in the Obama administration, noted that the Republican bills in both the House and Senate included money for reinsurance that can help lower premiums industry wide. Those provisions are among the “immediate steps Congress and the Trump administration need to take in order for markets to provide coverage that is affordable.”

A federal reinsurance program helps compensate insurers for the high costs incurred by the sickest patients. That, in turn, allows health plans to keep their overall premiums lower and attract healthier customers into the insurance pool.

Lawmakers could also appropriate federal funds for the cost-sharing subsidies, which have a price tag of about $7 billion a year. Those payments, made directly to insurers, help reduce deductibles and other out-of-pocket costs for policyholders who earn up to 250 percent of the federal poverty level. This year, that’s up to about $29,000 for an individual or around $61,000 for a family of four. More than half of the people enrolled on exchanges nationwide qualify for this financial assistance.

Without it, many consumers would face annual deductibles of $2,000 or more when visiting the doctor or undergoing medical tests. That would make people far less likely to sign up with participating insurers.

Conservatives generally oppose the subsidies, calling them a bailout of the insurance industry and arguing that the Obama administration didn’t have the authority to pay them. Trump has repeatedly threatened to cut off those cost-sharing subsidies as well.

With their future up in the air, some states, including California and Pennsylvania, allowed insurers to submit two sets of proposed premiums. One filing reflects continued federal funding of those subsidies, and a separate one assumes they are eliminated and their cost is included in health plan premiums.

In Pennsylvania, premiums next year without the subsidies would increase by an average of 20 percent, compared with 9 percent if they remained intact.

Pennsylvania Insurance Commissioner Teresa Miller said the market in her state would be in good shape without the uncertainty over federal policy. “The only thing right now keeping everyone on edge is what’s going to happen in Washington, D.C.,” Miller said. “If things calm down in D.C. and if we don’t see further changes, then Pennsylvania’s market really is stabilizing.”

On Tuesday, Covered California said the two different rate filings its health plans submitted will be released Aug. 1. The exchange may announce that same day what the final premiums are, or it could postpone the decision for several more weeks if Congress has begun to pursue fixes to the ACA.

“This decision is based on the ongoing federal uncertainty around the repeal and replacement attempts of the Affordable Care Act and the dramatic potential impacts such uncertainty has on the rates and on California consumers,” the exchange said in a statement.

A recent analysis commissioned by Covered California estimated that premiums for silver-tier plans would jump by 16.6 percent if the federal government stopped paying for the cost-sharing subsidies. That would be in addition to normal increases meant to cover rising medical costs. An exchange spokeswoman declined to comment further Tuesday, citing the ongoing developments in Washington.

In the Florida exchange market, health insurers have sought an average rate increase of nearly 18 percent. But Florida Blue, the state’s largest health insurer, said those rates would go even higher if the cost-sharing reduction payments disappeared.

Robert Laszewski, an industry consultant in Virginia and a frequent ACA critic, said the exchange markets aren’t imploding, despite what the Trump administration has often said. But their premiums will continue to rise unless more young and healthy people are persuaded to buy coverage, he said.

“I think most insurance companies will at least break even, or even make a profit, in 2018,” Laszewski said. “Coverage will be ‘stable,’ but it will stabilize at a horrific premium rate level.”

Death spiral? Obamacare insurers may be having ‘best year’ yet under ACA

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http://www.charlotteobserver.com/news/politics-government/article160601814.html

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New data on the improving finances of the nation’s individual insurers are calling into question repeated Republican claims that Obamacare marketplaces are collapsing under the Affordable Care Act.

For months, Republican leaders from President Donald Trump and Health and Human Services Secretary Tom Price to House Speaker Paul Ryan have said Obamacare was crumbling under its own weight and could not be saved. And this week, when HHS announced a 38 percent decline in the number of insurers that want to offer coverage next year in states that use the federal marketplace, Price said, “The situation has never been more dire.”

But new research released Monday by the Kaiser Family Foundation shows that profitability and other financial measures for individual insurers have dramatically improved over the last year.

“Now it looks like they’re on track to be profitable and that they’re actually having the best year that they’ve had since the ACA began,” said Cynthia Cox, associate director of health reform at Kaiser.

The share of premiums paid out as medical claims by individual insurers fell to 75 percent in the first quarter of 2017, down from 86 percent in the first three months of 2016 and 88 percent in the first quarter of 2015.

In addition, average monthly premium income exceeded monthly per-enrollee medical claims by roughly $100 in the first quarter of 2017, Kaiser reported. That’s up from about $48 in the first quarter of 2016 and just over $36 in the first quarter of 2015.

Throughout their push to repeal the Affordable Care Act, Republicans have said the market troubles in some areas were proof that Obamacare was unraveling and legislative change was needed. In a pair of tweets on May 4, Trump declared that ObamaCare was “dead” and the individual market was in a “Death spiral!,” in which insurance offerings disappear as premium hikes force all but the sickest to drop coverage.

Cox disputed that assessment: “There’s not really signs of a death spiral here,” she said.

The report, based on insurers’ first-quarter financial reports filed with the National Association of Insurance Commissioners and compiled by Mark Farrah Associates, comes as Senate Majority Leader Mitch McConnell struggles to find 50 votes to pass his Obamacare repeal legislation. Facing opposition from some conservatives, he has expressed a willingness to negotiate with Democrats on a legislative fix of the ACA as Republicans try to re-draft their legislation and move forward next week.

But Monday’s report could make across-the-aisle appeals more difficult, as the data indicates insurers could be on the verge of righting their financial ship.

In a letter to McConnell on Monday, four Democratic senators — Charles Schumer of New York, Debbie Stabenow of Michigan, Richard Durbin of Illinois and Patty Murray of Washington — urged McConnell make “common sense reforms” such as guaranteeing the cost-sharing payments, creating a permanent reinsurance program and finding solutions for areas without insurers.

Certainly, some marketplaces remain under enormous pressure. Far fewer people than originally expected enrolled into marketplace coverage and those who did were sicker, older and more costly than insurers expected. As losses mounted, insurers sharply increased premiums in 2017, making coverage unaffordable for many as enrollment slipped. Some insurers exited unprofitable markets altogether, leaving 38 rural counties in Ohio, Indiana and Nevada with the possibility of no coverage options next year, according to Kaiser. Five states — Alabama, Alaska, Oklahoma, South Carolina and Wyoming — have only one insurer offering marketplace coverage this year.

The Trump administration added to insurers’ problems by relaxing enforcement of Obamacare’s individual mandate and refusing to reimburse insurers for billions of dollars of financial assistance, known as cost-saving reductions, that go to low-income plan members.

An analysis by the Oliver Wyman consulting firm estimated that up to two-thirds of insurer rate increases for 2018 “will be due to the uncertainty surrounding these two market influences” and the Congressional Budget Office estimates premiums will increase 20 percent next year if the individual mandate is not enforced.

Blue Cross Blue Shield of North Carolina, which has more than 500,000 individual policy holders, wants to increase rates on their Obamacare plans by an average of 23 percent next year.

Speaking in Washington, DC at a recent Bipartisan Policy Center panel discussion, J. Brad Wilson, President and CEO of BCBS North Carolina said, “Over 50 percent of that increase is attributable to the uncertainty of CSRs.”

The industry trade group America’s Health Insurance Plans would not comment on the report.

 

Why Geisinger’s health plan stays on the ACA exchange

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http://www.beckershospitalreview.com/payer-issues/why-geisinger-s-health-plan-stays-on-the-aca-exchange.html

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Danville, Pa.-based Geisinger Health Plan has maintained a steady presence in Pennsylvania’s individual ACA exchange, despite other insurers leaving the state’s marketplace.

Over the last two years, a number of U.S. insurers decided to exit states’ ACA exchanges, citing financial losses as well as concerns regarding future stability of the individual market. Pennsylvania’s individual ACA exchange is no exception. Hartford, Conn.-based Aetna, for instance, pulled out of ACA exchanges for 2017 in 11 states, including Pennsylvania. Additionally, Minnetonka, Minn.-based UnitedHealthcare left ACA exchanges in Pennsylvania and nearly 30 other states for 2017.

Ultimately five insurers remained on Pennsylvania’s individual ACA exchange for 2017 and will remain in the market for 2018 — Geisinger Health Plan, Pittsburgh-based UPMC Health Plan, Harrisburg, Pa.-based Capital BlueCross, Philadelphia-based Independence Blue Cross and Pittsburgh-based Highmark.

Because some insurers left the state’s individual ACA exchange, Geisinger Health Plan experienced an increase in membership, says Kurt Wrobel, the plan’s CFO and chief actuary. The plan currently has 47,000 members, up from more than 30,000 in 2016. About 60 percent of the plan’s enrollment is individuals with Medicaid, Medicare or plans on the state’s individual ACA exchange.

Geisinger Health Plan also requested a rate increase for 2018 that it says is consistent with other insurers in the state. According to the Pennsylvania Department of Insurance, the five insurers that will continue selling on Pennsylvania’s individual ACA exchange for 2018 requested average statewide rate increases of 8.8 percent for individual plans.

Regarding Geisinger Health Plan’s choice to stay on the ACA exchange in Pennsylvania, Mr. Wrobel says it comes down to Geisinger’s commitment to the people of central Pennsylvania. “As a nonprofit, our primary stakeholders are the people, so with that we’re going to have a different calculation as far as our interest in staying in a program. While policy improvements are still needed, we’ve stayed in the program and we believe it’s workable as it stands now.”

One significant advantage Geisinger Health Plan has is its connection with Geisinger Health System. Geisinger Health Plan representatives said that connection allows it to develop programs such as care management programs for members, and many of the plan’s case managers work directly with physicians’ offices to provide more support and connectivity to members’ physicians.

“We think that’s a really clear differentiator. Within that, we have more robust care management systems and programs that allow us to control costs and improve outcomes, especially relative to traditional insurance companies,” Mr. Wrobel says.

As far as the future, the health plan will remain on Pennsylvania’s individual ACA exchange as long as it has a workable program.

Mr. Wrobel says Geisinger Health Plan wouldn’t rule out expanding to ACA marketplaces in other states at some point, but it’s not a high priority right now.

Overall, without the elimination of cost-sharing reductions, which help insurers subsidize the cost of coverage for low-income Americans, Mr. Wrobel believes Geisinger Health Plan could see greater stability moving forward.

“It’s our hope we can move beyond discussions, beyond all the financial issues with the program and really get to the meat of what we try to do as a health plan, which is provide cost-effective quality care,” he says. “I think we all look forward to the day when there’s sufficient stability — and that’s what we have in the Medicare and Medicaid program as well as the employer group program — where the focus is on that operational excellence of providing cost-effective quality care and we can move beyond these discussions about financial issues.”

 

Obamacare’s exchanges face their moment of truth

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https://www.washingtonpost.com/news/wonk/wp/2017/06/21/obamacares-exchanges-face-their-moment-of-truth/?_hsenc=p2ANqtz-8F5Et7EX-urS45blQiAgeOiovYIB4wXwv7AdGl1uVqRN78tI5gRCLl9EBfi-9z5qrbDTnToj2wGgiL5MWgwa6otTMFYA&_hsmi=53440118&utm_campaign=KHN%3A%20First%20Edition&utm_content=53440118&utm_medium=email&utm_source=hs_email&utm_term=.3252edd9c52b

Insurers hit a major deadline Wednesday: They must inform regulators in 39 states whether they will sell insurance on many Affordable Care Act marketplaces and, if so, how much they would like to charge.

It’s something of a moment of truth for the Affordable Care Act’s marketplaces, whose health depends in large part on the participation of private insurers. And so far, states are seeing mixed results: One major insurer has made a big pullout, while a different one announced it would expand into new states.

Insurance giant Anthem announced it would leave the marketplaces — also called exchanges — where individuals can use federal subsidies to buy health plans in two states in 2018, Indiana and Wisconsin. Oscar Health, a start-up company that was co-founded by Ivanka Trump’s brother-in-law, announced it would expand in Ohio, New Jersey, Texas, Tennessee, California and New York.

The deadline applies to all 39 states whose marketplaces are run by the federal government. An evolving map by the Kaiser Family Foundation showing which counties are at risk of having no insurance options next year highlights 44 counties in four states, where about 30,000 people buy insurance through the marketplaces.

People who buy individual insurance plans in the marketplaces can take advantage of federal tax credits that are pegged to income and reduce monthly premium payments. To date, there has not been a county with zero insurers selling policies on its marketplaces, and it’s not totally clear what will happen if a county is left without any plans. It’s possible, however, that without a functional exchange, would-be participants would have to shoulder the full costs of their health insurance — or go without.

The future of the marketplaces has become a major political talking point, with the White House declaring the marketplaces a failure. Democrats blame the struggles of the market on Republicans’ failure to offer insurers reasonable clarity about the future. In particular, insurers have complained that decision-making has been difficult without certainty that cost-sharing reduction subsidies, federal payments that help bring down the out-of-pocket costs for lower-income Americans, will be paid next year.

The business of selling health coverage on the Affordable Care Act marketplaces has become “difficult due to a shrinking and deteriorating individual market, as well as continual changes and uncertainty in federal operations, rules and guidance, including cost sharing reduction subsidies and the restoration of taxes on fully insured coverage,” Anthem said in a statement announcing the decision.

Mario Schlosser, chief executive of the start-up Oscar, made the opposite decision to expand its small footprint because of his faith in the long-term business of selling insurance to individuals.

“When the dust settles, there is more work to be done on the regulatory side to make sure it will be stable, but I’m confident we will see a stable market there,” Schlosser said.

MDwise Marketplace, an insurer in Indiana also announced it would leave that state’s exchange. That could put four counties at possible risk of having no insurer next year, according to Kaiser, although that is uncertain because a different insurer, Centene, has announced it is expanding in the state. A spokeswoman for Centene said the company was still working through the filing process and would not share information until it was complete.

Kaiser found counties in Ohio, Missouri and Washington are at risk of having no insurers.