Tag Archives: Health Insurance Individual Market

States Have Tried Versions Of ‘Skinny Repeal.’ It Didn’t Go Well.

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States Have Tried Versions Of ‘Skinny Repeal.’ It Didn’t Go Well.

Betting that thin is in — and might be the only way forward — Senate Republicans are eyeing a “skinny repeal” that rolls back an unpopular portion of the federal health law. But experts warn that the idea has been tried before, and with little success.

Senators are reportedly considering a narrow bill that would eliminate the Affordable Care Act’s “individual mandate,” which assesses a tax on Americans who don’t have insurance, along with penalties for employers with 50 or more workers who fail to offer health coverage.

Details aren’t clear, but it appears that — at least initially — the rest of the 2010 health law would remain, including the rule that says insurers must cover people with preexisting medical problems.

“We need an outcome, and if a so-called skinny repeal is the first step, that’s a good first step,” said Sen. Thom Tillis (R-N.C.).

Based on published reports, several Republican senators, including Dean Heller of Nevada and Jeff Flake of Arizona, appear to back this approach. It is, at least for now, being viewed as a step along the way to Republican health reform.

“I think that most people would understand that what you’re really voting on is trying to keep the conversation alive,” said Sen. Bob Corker, R-Tenn. “It’s not the policy itself … it’s about trying to create a bigger discussion about repeal between the House and Senate.”

But what if, during these strange legislative times, the skinny repeal were passed by the Senate and then became law? States’ experiences with insurance market reforms and rollbacks highlight the possible trouble spots.

Considering The Parallels

By the late 1990s, states such as Washington, Kentucky and Massachusetts felt a backlash from the coverage requirement rules they previously put on the individual market. When some of the rules were repealed, “things went badly,” said Mark Hall, director of the health law and policy program at Wake Forest University.

Premiums rose and insurers fled, leaving consumers who buy their own coverage, because they don’t get it through their jobs, with fewer choices and higher prices.

That’s because — like the Senate plan — the states generally kept popular parts of their laws, including protections for people with preexisting conditions. At the same time, they didn’t include mandates that consumers carry coverage.

That goes to a basic concept about any kind insurance: People who don’t file claims in any given year subsidize those who do. Also, those healthy people are less likely to sign up, insurers said, leaving them with only the more costly policyholders.

Bottomline: Insurers end up “less willing to participate in the market,” said Hall.

It’s not an exact comparison, though, he added, because the current federal health law offers something most states did not: significant subsidies to help some people buy coverage, which could blunt the effect of not having a mandate.

During the debate that led to passage of the federal ACA, insurers flat-out said the plan would fail without an individual mandate. On Wednesday, the Blue Cross Blue Shield Association weighed in again, saying that if there is no longer a coverage requirement, there should be “strong incentives for people to obtain health insurance and keep it year-round.”

About 6.5 million Americans reported owing penalties for not having coverage in 2015.

Polls consistently show, though, that the individual mandate is unpopular with the public. Indeed, when asked about nine provisions in the ACA, registered voters in a recent Politico/Morning Consult poll said they want the Senate to keep eight, rejecting only the individual mandate.

Even though the mandate’s penalty is often criticized as not strong enough, removing it would still affect the individual market.

“Insurers would react conservatively and increase rates substantially to cover their risk,” said insurance industry consultant Robert Laszewski.

That’s what happened after Washington state lawmakers rolled back rules in 1995 legislation. Insurers requested significant rate increases, which were then rejected by the state’s insurance commissioner. By 1998, the state’s largest insurer — Premera Blue Cross — said it was losing so much money that it would stop selling new individual policies, “precipitating a sense of crisis,” according to a study published in 2000 in the Journal of Health Politics, Policy and Law.

“When one pulled out, the others followed,” said current Washington Insurance Commissioner Mike Kreidler, who was then a regional director in the federal department of Health and Human Services.

The state’s individual market was volatile and difficult for years after. Insurers did come back, but won a concession: For a time, the insurance commissioner lost the power to reject rate increases. Kreidler, first elected in 2000, won the authority back.

Predicting the effect of removing the individual mandate is difficult, although he expects the impact would be modest, at least initially. Subsidies that help people purchase insurance coverage — if they remain as they are under current law — could help blunt the impact. But if those subsidies are reduced — or other changes are made that further drive healthy people out of the market — the impact could be greater.

“Few markets can go bad on you as fast as a health insurance market,” said Kreidler.

As for employers, dropping the requirement that those with 50 or more workers offer health insurance or face a financial penalty could mean some workers would lose coverage, but their jobs might be more secure, said Joe Antos, at the American Enterprise Institute.

That’s because the requirement meant that some smaller firms didn’t hire people or give workers more than 30 hours a week — the minimum needed under the ACA to be considered a full-time worker who qualified for health insurance.

The individual mandate, he added, may not be as much of a factor in getting people to enroll in coverage as some think because the Trump administration has indicated it might not enforce it anyway — and the penalty amount is far less than most people would have to pay for health insurance.

However, the individual market could be roiled by other factors, Antos said.

“The real impact would come if feds stopped promoting enrollment and did other things to make the exchanges [— the state and federal markets through which insurance is offered —] work more poorly.”

What Trump can do to cripple ObamaCare

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What Trump can do to cripple ObamaCare

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If Congress isn’t able to repeal ObamaCare, it’s likely that the Trump administration will follow through on the president’s vow to let the law fail.

President Trump regularly asserts that ObamaCare is dead or dying, and the administration has already taken steps to undermine the law while congressional Republicans struggle to enact healthcare legislation.

The administration has broad authority over the implementation of ObamaCare, giving officials the power to limit the law’s effectiveness even without congressional involvement.

Here are four ways Trump could cripple the law.

Stop the cost-sharing subsidies.

The biggest thing the Trump administration can do to hurt ObamaCare would be to stop making key subsidy payments to insurers, known as cost-sharing reductions (CSR).

Should the subsidies stop, the insurance markets would likely be thrown into chaos, which could bolster claims from Senate Republicans and the White House that ObamaCare is failing.

Trump has publicly waffled on whether he will continue the payments. At times he’s threatened to withhold them, let the ObamaCare markets collapse and then blame Democrats. At other times, he’s acknowledged the political risks and said the payments would continue.

“We pay hundreds of millions of dollars a month in subsidy that the courts don’t even want us to pay,” Trump said during a lunch with Republican senators Wednesday. “And when those payments stop, it stops immediately. It doesn’t take two years, three years, one year — it stops immediately.”

The White House made the payments for July, but has not made a commitment beyond this month. Insurers have called the payments critical, saying that without them, they would have to massively increase premiums for 2018 or exit the individual market.

Many insurers blamed uncertainty surrounding the payments for proposed double-digit rate increases for 2018.

Stop enforcing the individual mandate.

ObamaCare requires everyone in the country to have health insurance, or pay a penalty. Trump can’t unilaterally abolish the mandate, but he can instruct the IRS to stop enforcing it.

Trump hinted at such a move on the first day he took office, issuing a vaguely worded executive order instructing federal agencies to waive or defer any part of ObamaCare that imposed a “fiscal burden” on states.

But despite the threats, the mandate is still the law and people are still supposed to pay a penalty for lacking coverage.

Insurers are worried that if the Trump administration eases up on the mandate or creates more exemptions to it, it would create a “death spiral” in the ObamaCare markets.

The mandate helps bring in healthy enrollees to balance out the sick ones, with the goal of preventing premiums from spiking. If the healthy people don’t buy insurance, only the sickest will, and premiums will skyrocket.

The mixed signals from the administration about the mandate are spooking insurers. They don’t know what to plan for, and that’s showing in their filings.

“With open enrollment for 2018 only three months away, our members and all Americans need the certainty and security of knowing coverage will be available and affordable for them,” the BlueCross BlueShield Association said in a statement.

Pennsylvania’s five insurers, for example, filed premium increase requests averaging nearly 9 percent. But that increase could be hiked up to 36 percent without the individual mandate and the cost-sharing reduction payments.

Stop advertising and outreach.

The Obama administration used each open enrollment period to heavily promote exchange signups. Administration officials would appear in ads online and on TV.

The Trump administration has taken the opposite approach.

Shortly after Trump took office, the Department of Health and Human Services said it withdrew about $5 million of advertising that was intended to encourage people to sign up for insurance through ObamaCare.

HHS has also shortened the annual open enrollment period from three months to six weeks, and the agency churns out anti-ObamaCare charts, studies and graphics on a regular basis.

HHS Secretary Tom Price has also been producing swaths of ads showcasing “victims” of ObamaCare to promote the law’s repeal.

According to an AP report, the administration recently cancelled contracts with two companies that helped facilitate ObamaCare signups in 18 cities.

Advocates worry that without outreach from the government, Americans who need insurance won’t know they can sign up. Lower signups generally mean higher prices, which has been one of the most consistent Republican critiques of the law.

There’s also no indication that the administration is doing anything to convince insurers to stay in any of the “bare” counties across the country without an ObamaCare plan to buy.

The Centers for Medicare and Medicaid Services under Obama played an active role in enticing insurers back into the markets, but the Trump administration has taken a more hands-off approach.

Use administrative flexibility.

HHS Secretary Tom Price has enormous flexibility within the law to redefine some of its parameters. The powers given to the HHS secretary were meant to help implement ObamaCare, but Price has indicated he’ll use them to dismantle the law.

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

Congressional Republicans have urged Price to use every regulatory lever possible.

“There are a lot of things that can be done with regulations, that people don’t see happening on a daily basis,” Sen. John Barrasso (R-Wyo.) told The Hill recently.

For example, Price could change the rules requiring how much insurers would have to cover under the category of essential benefits. While the administration can’t repeal the requirement completely, they can change the definition.

Many congressional Republicans would like to either eliminate the essential health benefit requirement, or at the very least, let states and insurers opt out, so long as they also offer plans that comply with the rules.

If ObamaCare repeal fails in Congress, Republicans will be looking for Price to do the next best thing.

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.”

The BCRA is dead, but don’t take your eye off Capitol Hill

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http://www.healthcaredive.com/news/the-bcra-is-dead-but-dont-take-your-eye-off-capitol-hill/447356/

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The healthcare industry may have dodged a bullet, but this week’s legislative stumbles for the GOP don’t mean healthcare is off the table for Congress. Here’s what to watch.

The bulk of the Affordable Care Act (ACA) has survived the latest Republican efforts to repeal it, as Senate leaders were forced to admit Tuesday their best chance to fulfill years of campaign promises to gut the law has floundered.

The Senate plan to replace the ACA sank Tuesday night when the total number of Republicans opposing the bill rose to four. Republican Senate Leader Mitch McConnell immediately pivoted to an effort to repeal the ACAwithout a replacement plan. Only hours later, however, that plan also became unrealistic, as moderate Republicans said such a move would be too risky and they would not vote for it.

Industry groups were happy with the news. Scores of policy experts and healthcare professionals had railed against both the Senate and House bills to replace the ACA. Congressional Budget Office estimates found they would take away health insurance coverage for more than 20 million people. Both proposals also drastically cut Medicaid and eliminated protections for people with pre-existing conditions.

Millions more uninsured would have caused a hefty increase in uncompensated care costs for hospitals. The Commonwealth Fund estimated both replacement bills would have meant nearly a million healthcare jobs lost by 2026.

The industry may have dodged a bullet, but this week’s legislative stumbles for the GOP don’t mean healthcare will be off the table in Congress. Here’s what to watch.

Stabilizing the individual market

The most immediate concern for payers with ACA repeal out of the picture is cost-sharing reduction (CSR) payments and the stabilization of the individual market. McConnell has said legislation to help shore up the market would be needed if the Senate’s Better Care and Reconciliation Act (BCRA) failed. But at least one lawmaker — Senate Majority Whip John Cornyn — said Tuesday he would “not be part of any bailout of insurance companies.”

President Donald Trump said Tuesday that Republicans should “let Obamacare fail” and pin the blame on Democrats. This would likely mean withholding CSRs, a position Trump has repeatedly advocated.

CSRs are meant to help insurers pay for beneficiaries with more care needs and therefore higher costs. They help payers keep a balanced risk pool. Congress and the White House have so far refused to commit to the payments for next year, and insurance companies pulling out of the ACA exchange markets have cited that inaction as a major reason for withdrawal.

The Trump administration still has to decide whether to continue defending a lawsuit against the White House from House Republicans claiming the Obama administration was paying the CSRs without proper appropriation. Payers are hoping Republicans agree to commit to future CSRs with a clearly above-board fund.

Republicans who balk at the CSRs may try to push their own ideas for how to stabilize the market. They have previously proposed changing the age band to allow insurers to charge older people more and tightening requirements for special enrollment periods. The BCRA included $112 billion to help payers stabilize the market, but that funding lasted only two years and assumed the other numerous changes the BCRA called for would go into effect.

Payers would much prefer a commitment to funding CSRs with a clearly above-board fund. That would certainly help steady the ACA marketplaces, but Republican rhetoric about the markets’ “death spiral” is overblown. The CBO has said the individual market would remain stable in most areas under current law, and a Kaiser Family Foundation report showed that payers are regaining profitability in the market while stability is increasing.

Executive actions

The White House will likely be making its own plans in case efforts in Congress fall through.

Trump has said very little about healthcare policy during his time in office. Other than a few tweets, Trump didn’t participate in vote-wrangling for the ACA replacement bills and didn’t make much use of his bully pulpit.

He held a celebratory press conference in the Rose Garden when the House passed its ACA replacement bill and also supported the BCRA. When the Senate bill failed, he immediately called for a repeal without replacement, but the administration didn’t elaborate on when a replacement might come or what it would look like.

Trump has already issued one major executive order on healthcare. Immediately after taking office, he told federal agencies to “exercise all authority and discretion available to them to waive, defer, grant exemptions from, or delay any provision or requirement that of the Act that would impose a fiscal burden on any state or a cost, fee, tax, penalty, or regulatory burden on individuals, families, healthcare providers, health insurers, purchasers of health insurance, or makers of medical devices, products, or medication.”

The IRS under Trump is still technically enforcing the individual mandate, although it also accepted tax returns that don’t indicate whether the filer has health insurance. With the failure to replace the ACA in Congress, Trump could push for complete abandonment of the requirement. Without the mandate, healthy people who don’t need much care would be less likely to get coverage and risk pools would become more unstable.

HHS has already indicated it will allow more state waivers under the ACA, letting states dictate what benefits are required and how people qualify for Medicaid. Conservative states have started planning waiver applications with aspects like a requirement that Medicaid beneficiaries have a job.

The administration could also weaken the ACA by refusing to publicize it. Immediately after Trump took office, the government scaled back advertising for the ACA open enrollment period. This led to fewer signups in the typically busy final days of enrollment. Without a push for young and healthy people to enroll, risk pools could again get off balance.

It hasn’t meant much yet, but with repeal off the table for now, the administration could push for more use of the order. Executive action could be tricky, however, as HHS remains understaffed.

Bipartisan options

Although Republicans and Democrats are far apart on nearly every aspect of healthcare reform, they could find that working together is their only chance of getting anything passed.

One jumping off point could be the bill put forward earlier this year by two of the more moderate Senate Republicans. It would repeal the individual and federal mandates as well as essential health benefits, but keep some aspects of the ACA, like a ban on coverage caps. It would also allow states to implement their own alternative plans, possibly with federal assistance.

Giving more control to state governments — a tactic embraced by HHS Secretary Tom Price — appeals to the left in some ways, but Democrats and patient advocates will oppose any weakening of protections for people with pre-existing and chronic conditions. Republican plans that throw out coverage mandates cannot guarantee such protections because they can easily create unbalanced risk pools.

One initiative that has nearly universal support is MACRA, as well as the movement toward value-based care in general. As providers deal with implementing MACRA payment model changes, Congress may be asked to make some tweaks or delays.

It’s unlikely any major healthcare changes in the near future will be bipartisan, but lawmakers willing to reach across the aisle could try to tackle some smaller issues.

CHIP reauthorization

Another chance to pass healthcare legislation will come at the end of September when the Children’s Health Insurance Program (CHIP) is set to expire. Lawmakers want to ensure the program continues, but may also see it as a possible vehicle for other bills. Republicans have already delayed hearings on renewing CHIP as they’ve debated how to move forward on healthcare changes.

This could be the route for a bill to stabilize the individual market. Republicans and Democrats may try to use this opportunity to push through other changes, but any delay that threatens the continuation of CHIP will be heavily criticized.

The massive Senate GOP shift on pre-existing conditions

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https://www.axios.com/the-massive-senate-gop-shift-on-pre-existing-conditions-2458798705.html

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Over the past several weeks, senior GOP aides have repeatedly said that if the Senate bill touches pre-existing conditions in any way, it will lose around a third of the caucus. Today, a provision that could cause sick people to pay much higher premiums than they currently do has not caused any Republicans to say they’ll vote against the GOP health bill.

  • When Senate GOP leaders first presented their plan to the caucus in a PowerPoint presentation, it explicitly said that pre-existing conditions wouldn’t be touched, aides say.
  • As recently as two weeks ago, aides said members were surprised and angry to learn that Sen. Ted Cruz’s Consumer Freedom Option would allow plans that didn’t include the Affordable Care Act’s pre-existing conditions protections. (They could only be sold by insurers that also offered plans with the protections.)
  • Sen. Bob Corker: “I think people understand that’s got to be protected, and people understand what happened when the House dealt with it and opened it up, and it’s just not something that senators are wishing to do.”
  • Sen. Shelley Moore Capito over recess: “I think that reopens an issue that I can’t support, that it would make it too difficult for people with pre-existing conditions to get coverage.”
  • Sen. Chuck Grassley last week: “There’s a real feeling that that’s subterfuge to get around pre-existing conditions.”

Now, that resistance is “melting away,” as one Senate Republican aide put it today. “No one wants to be bad guy.”

Indeed, almost seven hours after the revised bill — including the Cruz provision — had been released, no Republican senator had threatened to vote against the bill unless the provision is removed. In fact, Republicans had surprisingly little to say about it.

What the Consumer Freedom Option does: 

  • It allows insurers that offer ACA-compliant plans to also sell plans that do not comply with ACA regulations, including the law’s essential health benefits and its pre-existing conditions protections.
  • Advocates of the bill say that while this could sort sick and healthy people into two different marketplaces, causing premiums to skyrocket for sick people, they’ll be insulated from these costs by premium subsidies and the bill’s stabilization fund.
  • Members “don’t realize we are basically creating single payer for sick people,” the GOP aide told me, saying that Republicans’ support is growing because people with pre-existing conditions can still get exchange plans.
  • The problem: “If there were hearings, everyone would have a lot more information about Cruz. Right now, Cruz is the only seller of the amendment and he’s the only one with information about the amendment,” said one well-connected GOP lobbyist, who said Cruz’s sales pitch seems to be convincing members to support his idea.
What insurers and experts are saying: 
  • America’s Health Insurance Plans: “Patients with pre-existing conditions … would potentially lose access to comprehensive coverage and/or have plans that were far more expensive.”
  • Scott Serota, president and CEO of the Blue Cross Blue Shield Association: “The ‘Consumer Freedom Option’ is unworkable as it would undermine pre-existing condition protections, increase premiums and destabilize the market.”
  • Kaiser Family Foundation: 1.5 million people with pre-existing conditions could have higher premiums under the Cruz amendment.
Yes, but: The conservative groups love it, as it addresses the ACA regulations that weren’t fully addressed in the previous version of the bill. They believe those regulations are driving up the cost of insurance. Stripping the provision could lose these groups’ support.

And Michael Cannon of the libertarian Cato Institute says the provision “would make access to healthcare more secure for patients who develop expensive conditions” — because it would free insurers to introduce a wider variety of health plans and make them less likely to leave the markets.

 

AHIP: Cruz proposal would destabilize the ACA exchanges

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http://www.fiercehealthcare.com/aca/ahip-cruz-proposal-would-destabilize-individual-marketplaces?utm_medium=nl&utm_source=internal&mrkid=959610&mkt_tok=eyJpIjoiT1RFeFl6QTBOalV4WlRsayIsInQiOiJ2ZkV5eXJiTVp5ZGZQYk5NRlozSzYwdEdoVTduQW1SMDkyVVdqR0lPbXVGMDNJUjJEN0U3b2dDcmp1NlNncSthUStTeFordHNGcVwvMFRtNnFGXC9mczBpa3NDU0NkZHBSa003NkQ4bjVcL3krTkZ1R2ZNb3R4MGtWYWo3UVwvcjkwZVIifQ%3D%3D

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The health insurance industry’s largest trade group is warning that a proposed amendment to the Senate’s healthcare bill could not only destabilize the individual marketplaces, but also harm patients with pre-existing conditions.

The amendment, introduced by Sen. Ted Cruz, R-Texas, would allow insurers to sell health plans that aren’t compliant with the Affordable Care Act’s rules in any given state as long as they sell at least one ACA-compliant plan on that state’s exchange.

Cruz and the amendment’s other supporters in the Senate said the concept would allow insurers to offer a wider variety of coverage options and help lower premiums. Senate Majority Leader even reportedly went so far as to ask the Congressional Budget Office to score the proposal.

But the idea also has plenty of critics, including America’s Health Insurance Plans (AHIP).

In a document (PDF) posted on its website, the trade group said that allowing health insurance products to be governed by different rules would effectively “fracture and segment insurance markets into separate risk pools and create an un-level playing field that would lead to widespread adverse selection and unstable health insurance markets.”

The trade group pointed out that part of the exchanges’ current woes stemmed from the Obama administration’s transitional policy, which allowed individuals to renew their non-ACA-compliant plans. In states that opted to adopt this policy, actuaries estimated that exchange market premiums were an average of 10% higher.

Cruz’s amendment, which would essentially make that transitional policy permanent, “would create even greater instability,” AHIP said.

The fact that the proposal would require insurers to also offer an ACA-compliant plan, the group said, is not enough to protect consumers with pre-existing conditions or higher-than-average healthcare costs. The ACA’s consumer protection provisions, such as guaranteed issue and community rating, AHIP notes, “only work if there is broad participation to assure stable markets and affordable premiums,” which wouldn’t be the case under Cruz’s proposal.

In fact, a newly released analysis from the Kaiser Family Foundation estimated that the amendment could result in 1.5 million people with pre-existing conditions facing higher premiums.

Finally, it’s simply not practical to maintain a single risk pool if all health plans don’t have to provide coverage for the same benefits, AHIP stated, adding that the Cruz amendment also would make programs like risk adjustment “unworkable.”

Obamacare 101: Is there a smaller fix for the Affordable Care Act?

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http://www.latimes.com/politics/la-na-pol-obamacare-101-marketplace-fixes-20170712-story.html?utm_campaign=KHN%3A%20First%20Edition&utm_source=hs_email&utm_medium=email&utm_content=54139610&_hsenc=p2ANqtz-_oK9ym4MAYbgjGTqJrtwWnYS7JczHHbl_O85RanUGaeiUnTcx9hvcqv7rFbgtEigUowQiiD8dTN5J0Reyhnc3D456E0Q&_hsmi=54139610

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With Senate Republicans struggling to find votes for sweeping legislation to roll back the Affordable Care Act, several GOP lawmakers have raised the prospect of a more limited bill — passed with help from Democrats — to stabilize health insurance markets around the country.

That may be heresy for conservative Republicans who’ve spent seven years demanding the full repeal of Obamacare, as the law is often called.

But most patient advocates, physician groups, hospitals and even many health insurers say more-targeted fixes to insurance marketplaces make more sense than the kind of far-reaching overhaul of government health programs that Republicans have been discussing.

Why do a more limited Obamacare ‘fix’?

For one thing, it would be politically easier. More-targeted legislation also wouldn’t threaten insurance protections for tens of millions of Americans.

The political debate over the 2010 healthcare law has focused for years on what has been happening to insurance marketplaces like HealthCare.gov, which were created by the law for Americans who don’t get health insurance through work.

For a variety of reasons, the marketplaces’ first several years have been rocky.

Insurers in many states struggled to figure out how much to charge for their plans and then raised premiums substantially when customers turned out to be sicker than they expected.

And as uncertainty over the future of the markets has intensified since President Trump’s election last year, several leading national insurers have decided to stop selling plans in some states, leaving consumers in some places with few if any health plans to choose from. Trump has called Obamacare a “disaster” and “dead.”

But the marketplaces — where about 10 million Americans currently get coverage — represent a very small fraction of the U.S. healthcare system.

By contrast, more than 70 million Americans rely on Medicaid and the related Children’s Health Insurance Plan, the government safety net plans for the poor.

Altering Medicaid, as proposed under the GOP plan, would be far more disruptive. And, as congressional Republicans are learning, it is much more controversial.

But isn’t Medicaid a big problem, too?

Many conservatives have long argued the federal government can’t afford to provide so much healthcare assistance to the poor.

But Medicaid has become a vital lifeline for tens of millions of Americans. Medicaid provides assistance to more than one in three U.S. children, protects millions of Americans with disabilities and is the largest funder of nursing home care for elderly Americans, in large part because Medicare does not cover nursing homes.

Obamacare’s Medicaid expansion, which made coverage available to working-age adults in many states, is credited with driving down the nation’s uninsured rate to the lowest levels ever recorded.

And a growing body of evidence shows it is improving low-income Americans’ access to needed medical care, reducing financial strains on families and improving health.

That is why Medicaid has been fiercely defended by patient groups, doctors, nurses, educators and even some Republican governors.

What would it take to stabilize insurance markets?

Probably not that much, actually.

There is widespread agreement that the federal government must first continue funding assistance through Obamacare to low-income consumers to help offset their co-pays and deductibles.

This aid — known as cost-sharing reduction, or CSR, payments – was included in the original law.

But the payments have become a political football as Republicans argued the aid can’t be provided without an appropriation by Congress. And Trump administration officials keep threatening to cut off the payments.

Many insurers say that would be devastating, forcing them to raise premiums by double digits.

Congress could simply put an end to that uncertainty by voting to appropriate the CSR money.

Secondly, most insurance industry officials and independent experts say the federal government must create a better system to protect insurers from big losses if they are hit with very costly patients.

Such reinsurance systems are used in other insurance marketplaces such as the Medicare Part D prescription drug program and are seen as critical to stabilizing markets.

Thirdly, current and former marketplace officials say, the federal government should aggressively market and advertise to get younger, healthier people to buy health plans on the marketplaces.

This strategy has helped Covered California, that state’s marketplace, which has not been beset by some of the problems in other markets.

Finally, many experts say, federal officials likely will have to come up with additional incentives to convince health insurers to offer plans in remote, rural areas.

Some Republicans have suggested that consumers in these areas could be allowed to buy health plans that don’t meet standards set out in the current law.

Would these steps cost more money?

Yes.

But both the House and Senate GOP bills to roll back Obamacare included billions of dollars to stabilize markets over the next several years.

So could Congress put that aid in a smaller healthcare bill?

That’s still unclear.

Many congressional Republicans are reluctant to spend any more money on healthcare aid, especially for a law that most have sworn to repeal.

But polls indicate that Americans now hold congressional Republicans and the Trump administration responsible for the fate of the nation’s healthcare system, including the insurance marketplaces.

That suggests that there could be a political price to pay for the GOP if the markets are not stabilized.

At the same time, Senate Democrats have signaled a willingness to work with Republicans on marketplaces fixes if GOP lawmakers agree to drop their repeal campaign.

But major hurdles remain, including demands from many GOP lawmakers that at least some of Obamacare’s provisions be repealed, such as the highly unpopular mandate requiring Americans to have health insurance.

Rather than stabilizing markets, however, eliminating the insurance requirement could lead to even more turmoil, experts say.

Low-Cost Health Insurance Limits Access to Top Cancer Doctors

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https://www.bloomberg.com/news/articles/2017-07-05/low-cost-health-insurance-limits-access-to-top-cancer-doctors

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The nation’s top cancer doctors are more likely to be excluded from low-cost health insurance plans offered on the nation’s individual market, potentially crimping access to the highest-quality care for Americans when they need it most, a new study found.

The individual exchanges, opened in 2014 as part of the Affordable Care Act, often include lower-cost policies that limit the number of physicians available to members as a way to cut costs. Those “narrow networks” are becoming more prevalent in Obamacare, as insurers seek ways to offer cheaper coverage, according to McKinsey & Co. The study was published in the Journal of Clinical Oncology and examined data from 2014.

The study offers a sense of the tradeoffs Americans face when buying health-care coverage on their own: Plans with lower premiums often get costs down by limiting choices of doctors and hospitals, asking patients to pay more out of pocket, or some combination of the two. It’s an issue patients are increasingly facing in insurance provided by employers, too, and one they’d likely continue to deal with under Republican plans to replace Obamacare. The current GOP proposals offer less financial help for people to buy coverage and could shift more people into lower-cost plans.

For the study, researchers from the University of Pennsylvania analyzed data on 23,442 oncologists in the U.S., evaluating how often doctors affiliated with National Cancer Institute-designated centers were covered by lower-cost insurance plans. The University of Pennsylvania is an NCI-designated cancer center.

Oncologists working at the U.S.’s 69 NCI facilities in the U.S., which offer access to scientific research and are known for their handling of complex cases, were twice as likely to be excluded from plans with the narrowest networks, according to the study.

“Most common cancers can be treated well anywhere,” said Justin Bekelman, associate professor of radiation oncology, medical ethics and health policy at the University of Pennsylvania, and one of the researchers. “But there are many patients with rare or uncommon tumors who need access to the most advanced clinical trials, and that access is often only at these NCI cancer centers. On the individual market, when people are spending their own hard-earned dollars, they can chose to have access or not. But right now they are choosing in a blind way.”

Network Questions

The Obama administration had been working to make it easier for people to figure out whether individual doctors and drugs were covered by their Obamacare plans by looking up such information online. It’s harder for consumers to determine the comprehensiveness of an insurance plan’s network, however, and so far there’s only been a limited effort to require plans to disclose the overall size of their networks.

Regulating insurers’ networks is largely left up to the states. The Trump administration has said it will defer to states rather than conduct its own reviews, for the most part.

“Certainly there are real issues with consumers trying to understand what kind of network they’re getting,” said Justin Giovanelli, an associate research professor at Georgetown University’s Center on Health Insurance Reforms who wasn’t involved in the study. “What you want is to have more information so you can make good choices about it.”

Health plans have procedures that let patients who need specialized care get to the appropriate doctors, according to a statement from the industry group America’s Health Insurance Plans. The group noted that the study dealt with coverage for individual physicians, not for the facilities themselves.

“Patient access to an oncologist affiliated with an NCI-designated or NCCN cancer center is separate from patient access to treatment at these centers,” Kristine Grow, an AHIP spokeswoman, said in the statement. “Community oncologists who are part of the plan’s network can recommend patients to these centers based on patient needs.”

Higher Costs

According to the researchers, doctors at NCI-designated cancer centers, such as Memorial Sloan-Kettering in New York, Dana-Farber in Boston, MD Anderson in Houston and the University of Pennsylvania, may be excluded from the narrow networks because of their cost. Because of the doctors’ status, the centers may be more able to negotiate higher reimbursement rates for their services. They may also attract more complicated, and thus costly, patients. Excluding them could help insurers control expenses at the price of limiting access to high-quality, specialized care, the researchers said.

“In an ideal world, narrow networks could be a great tool for insurers to steer patients toward these higher quality providers, to ensure that overall costs are actually lower,” said lead researcher Laura Yasaitis, from the department of health economics at the University of Pennsylvania. “It looks like in the data we looked at that prices may be the more prominent motivator for insurers.”

The Penn researchers analyzed 248 insurance networks across the U.S. operating in areas with NCI-designated centers. They found that one in every three significantly limited the number of oncologists in their insurance plans. Of all the cancer doctors who were part of those narrow networks, 17 percent worked at NCI centers. Of all the doctors who were excluded from those plans, 35 percent participated at NCI centers.

The discrepancy wasn’t seen in broader insurance networks. In those plans, 34 percent of included oncologists were affiliated with NCI centers, compared with 29 percent of those cancer doctors who were excluded, according to the study.

Numbers of uninsured changes little from House version of healthcare bill, CBO score estimates

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The number of uninsured by 2026 would increase by 22 million, 1 million less than what was estimated under the House bill.

Under the new Senate bill, the number of people who would be uninsured by 2026 would increase by 22 million as compared to the number under the current Affordable Care Act and 1 million less than what was estimated under the House bill’s American Health Care Act, according to a score of the bill released Monday afternoon by the Congressional Budget Office and the staff of the Joint Committee on Taxation.

By 2026, an estimated 49 million people would be uninsured, compared with 28 million who would lack insurance that year under the current Affordable Care Act, the CBO said.

In 2018, 15 million more people would be uninsured under this legislation than under current law–primarily because the penalty for individuals and employers for not having insurance would be eliminated.

In later years, other changes in the legislation–lower spending on Medicaid and substantially smaller average subsidies for coverage in the nongroup market–would also lead to increases in the number of people without health insurance, the CBO said.

By 2026, among people under age 65, enrollment in Medicaid would fall by about 16 percent.

Senate Majority Leader Mitch McConnell reportedly wants a vote prior to the July 4 recess but it’s unknown whether he’ll have the votes necessary among his own party members.

Democrats were quick to denounce the bill because of the CBO findings.

“Today’s CBO score has pulled back the curtain of Senate Republicans’ healthcare bill: it’s about giving huge tax cuts to millionaires and billionaires and dismantling important middle class programs like Medicaid and Medicare, all in the name of ‘health care reform,’ said Ways and Means Committee Ranking Member Richard Neal, a Democrat from Massachusetts.

Providers also find little to like in a bill that takes away coverage in both the individual market and through Medicaid.

“The Senate’s Better Care Reconciliation Act would be as damaging to the country as its deeply unpopular House counterpart, the American Health Care Act,” said Bruce Siegel, MD, president and CEO America’s Essential Hospitals.

The score reflects a last-minute amendment by McConnell to stabilize the insurance market through a continuous coverage provision giving a penalty for a lapse in insurance.

The Senate’s Better Care Reconciliation Act of 2017 is the Senate’s answer to H.R. 1628 put forward by House Majority Leader Paul Ryan in May.

The CBO forecasts stability for the nongroup market in most areas of the country under the new bill, including in states that obtain waivers for coverage of essential benefits.

This is because there would be substantial federal funding to directly reduce premiums available through 2021. Premium tax credits would continue to provide insulation from changes in premiums through 2021 and in later years, the CBO said.

Lower premiums will help attract enough relatively healthy people for the market in most areas of the country.

That stability would continue even when cost-sharing reduction payments to insurers are eliminated starting in 2020, a move payers have said would drive up the price of premiums.

A small fraction of the population resides in areas in which — because of this legislation — no insurers would participate in the nongroup market or insurance would be offered only with very high premiums.

Insurance covering certain services would become more expensive–in some cases, extremely expensive–in some areas because the scope of coverage for essential health benefits would be narrowed through waivers affecting close to half the population, CBO and JCT said.

The CBO and JCT estimate that enacting this legislation would reduce the federal deficit over the 2017-2026 period by $321 billion. This is $202 billion more than the estimated net savings for the version of H.R. 1628 that was passed by the House.

The largest savings would come from reductions in Medicaid. Spending on the program would decline by 26 percent in 2026 compared with what CBO projects under current law.

Spending would be reduced because of the elimination of federal spending for Medicaid expansion under the ACA’s subsidies for nongroup health insurance.

Those savings would be partially offset by the effects of other changes to the ACA’s provisions dealing with insurance coverage including additional spending designed to reduce premiums and a reduction in revenues from repealing penalties on employers who do not offer insurance and on people who do not purchase insurance.

The largest increases in deficits would come from repealing or modifying tax provisions in the ACA that are not directly related to health insurance coverage, including repealing a surtax on net investment income and repealing annual fees imposed on health insurers, the CBO said.

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.