Throughout 2017, the Trump Administration and Republicans have been pushing the idea that the Affordable Care Act is “imploding” or “collapsing under its own weight.” Among the most damning evidence they’ve pointed to is “bare counties” – areas where no health carrier filed ACA-compliant marketplace health plans for 2018. But while that was a looming problem earlier in the summer, it has been resolved nationwide, for the time being.
Some carriers are leaving, but others are filling the gaps
When rates and plans were initially filed for 2018, there were 82 counties across the country (out of 3,142 total) where no insurers intended to offer coverage. But insurance regulators in the affected states have worked tirelessly to convince insurers to fill in the bare spots, and the last one — Paulding County, Ohio — was filled as of August 24. Insurers can still back out for a few more weeks, as contracts with HealthCare.gov don’t have to be signed until September 27. But for the time being, every area of the country has exchange plans filed for 2018.
But the previously “bare” counties in Tennessee, Washington, Kansas, Missouri, Ohio, Indiana, Wisconsin, Nevada, and Virginia now have insurers slated to offer coverage. In some cases, more than one insurer stepped up to fill in bare counties.
Here’s the current status of carrier exits – and entries:
Which carriers are leaving the exchanges
Here’s a summary of which insurers are leaving, and where, as of mid-August:
Anthem is exiting the exchanges in Indiana, Maine, Nevada, Ohio, and Wisconsin, and scaling back their exchange coverage area in California, Georgia, Missouri, and Virginia. (Anthem had previously said that they would exit Virginia entirely, but refiled plans to offer coverage in part of the state for 2018; they offer statewide coverage in Virginia in 2017).
CeltiCare is exiting the exchange in Massachusetts (but a July enrollment report indicates that CeltiCare has zero percent of the MA exchange’s QHP and small group enrollees, and only 1 percent of the ConnectorCare enrollees).
CareSource is expanding their coverage area in Ohio and Indiana.
Centene (which includes Buckeye Health Plan, Silver Summit, Coordinated Care Corporation, Ambetter, and Celtic) is expanding their coverage area in Florida, Georgia, Indiana, Ohio, Texas, and Washington, and joining the exchanges in Nevada, Missouri and Kansas. In doing so, they have filed plans in numerous counties that would otherwise have had no insurers for 2018.
Medical Mutual is expanding their coverage area in Ohio.
Montana Health CO-OP froze their enrollment in December 2016, but they have reopened enrollment in the summer of 2017, and will once again offer coverage in Montana during open enrollment.
University of Utah Health Plans is expanding to a statewide coverage area in Utah’s exchange for 2018.
What does it all mean for consumers?
First of all, we’re not saying that there’s nothing to worry about. Carriers are nervous, and some are exiting the exchanges. And although virtually all counties have at least one insurer lined up to offer plans in the exchange for 2018, there will be more areas of the country with only one insurer offering coverage.
According to CMS, nearly 28 percent of exchange enrollees will have access to just one insurer in the exchange for 2018. (It’s worth noting, however, that the map CMS has been updating all summer does not account for all of the filings that insurers have submitted. As an example, the map still shows all of Alabama with just one insurer for 2018, despite the fact that the Birmingham area will have two.)
But regardless of how many insurers will offer coverage in your area, it’s certainly nerve wracking if you currently have coverage with one of the exiting insurers, and are facing an involuntary plan change for 2018.
So what does all of this mean for consumers, as we head into the fifth open enrollment period?
What happens if your carrier exits?
Insurers that are exiting the exchange generally have to provide enrollees with at least 90 to 180 days notice, depending on whether the exit is from just the exchange, or the entire individual market (on and off-exchange).
The exchange also sends out communications to enrollees each fall regarding coverage for the upcoming year. So if your insurer is leaving the exchange, you will be notified by the exchange and by your insurer, well in advance of open enrollment. If the exchange is planning to map you to a new plan, they will communicate that to you as well.
Mapping people to new coverage when their previous insurer exits the exchange is a procedure that HealthCare.gov implemented for 2017 (and some state-run exchanges have adopted similar protocol), in an effort to ensure that people don’t find themselves uninsured on January 1. In previous years, that was the result if an insurer left the exchange and the enrollee didn’t return to the exchange during open enrollment to actively pick a new plan.
HealthCare.gov’s mapping protocol means that most enrollees will still have coverage on January 1. But open enrollment is your opportunity to pick your own plan instead of just accepting the replacement plan that’s selected for you by the exchange. However, consumers need to be aware that open enrollment will end much earlier this year than it has in the past. In nearly every state, it will run from November 1, 2017 to December 15, 2017, although there are some state-run exchanges that have announced extensions.
So in the rural areas of the country where there will be just one insurer offering exchange plans, it’s important to understand that the ACA has built-in safeguards to protect consumers. Insurers in those areas cannot simply raise prices due to the lack of competition, nor can they offer coverage with overly skimpy provider networks.
Although there are currently no areas of the country without plans filed for 2018, there is also no solution in place yet to address that situation if it does arise. But insurance regulators and insurers have thus far done an admirable job of solving the problem in the 82 counties that were facing the prospect of having no exchange plans available in 2018.
If you feel you haven’t quite gotten your fill of health policy for the week, head on over to xpostfactoid for the latest edition of Health Wonk Review. Host Andrew Sprung has dedicated this edition to the individual who continues to suck the air out of every room: President Trump.
It’s a quick read, but loaded with, as always, with something for everyone, with – in Andrew’s own words –
“snapshots of a country that continues to trail its peers in population health measures; an opioid vendor looking to short-circuit potential tobacco industry-level liability; an individual market for health insurance offering unaffordable plans to many of the unsubsidized, and freakish bargains to some of the subsidized; and, for a little futuristic relief, a human resources tech vendor that may chain healthcare data to a block, where it shall remain unaltered forever and ever.”
It’s great stuff. Our thanks to Andrew for graciously including our recent post – timely reading for folks who may be wondering just how long they can go without insurance before they’d face the ACA’s individual mandate.
And all of this comes after Republican lawmakers and governors spent the previous seven years sabotaging the ACA, and concurrently with Republican lawmakers’ protracted efforts to repeal the ACA in 2017.
But while the Trump Administration has been working to thwart the ACA, quite a few states have been taking action to shore up their individual markets and protect access to health care. Let’s take a look at what they’re doing:
But nine state-run exchanges have decided to go with a longer open enrollment period this year, and transition to the shorter open enrollment as scheduled in the fall of 2018. Enrollment will begin on November 1 in all of them, but will end on the following dates:
Connecticut: December 22 (for coverage effective January 1)
Rhode Island: December 31 (for coverage effective January 1)
In those states, people have extra time to enroll. Data from previous open enrollment periods indicates that the people who enroll on the later end of the window tend to be younger and healthier than those who enroll at the start of the window. This makes sense, as sick people are not likely to procrastinate when it comes to securing health insurance coverage.
So the longer open enrollment periods in those nine states are an effort to ensure that enrollment assistance isn’t stretched too thin, that as many people as possible can enroll, and that the individual market risk pool will be as stable and healthy as possible.
Adding the cost of CSR to Silver plans
Premiums for 2018 are going to be significantly higher than they would have been if cost-sharing reduction (CSR) funding had been committed early in 2017. And after months of dithering on the issue, the Trump Administration announced three weeks before the start of open enrollment that funding for cost-sharing reductions would end immediately.
But regulators in many states had already anticipated that move, and had taken action to protect the majority of their individual market enrollees from the fallout.
In general, states that directed insurers to add the cost of CSR to Silver plans have protected most consumers from the impact of the elimination of federal funding for CSR. Many states, including California, Pennsylvania, and Florida, have taken that strategy even further, by ensuring that there are off-exchange-only Silver plans that won’t include the cost of CSR in their premiums.
In short, states had the option to take action to ensure that most consumers would be unharmed by the CSR funding cut. Many did so by late summer, and others made last-minute changes to rates after the Trump Administration clarified that CSR funding would not continue.
A perceived weakening of the individual mandate is destabilizing to insurance markets. But reinsurance is an effective means of stabilizing the individual market, and can provide a counterbalance to the Trump Administration’s efforts to undermine the ACA.
Nationwide, there are about 16.5 million people in the ACA-compliant individual market. But since each state’s individual market is separate from all the others, most of them have fairly low total populations. So it doesn’t take very many high claims to destabilize a state’s individual market, since the premium increases necessary to cover claims can result in coverage becoming unaffordable for healthy, unsubsidized enrollees, who then leave the market, further exacerbating the problem.
The ACA included a reinsurance program, but it was temporary and only lasted through 2016. So some states have set out to create their own reinsurance programs, using 1332 waivers so that they can fund reinsurance with the federal money that would have otherwise been spent on larger premium subsidies. The result is fairly minimal state spending and unchanged federal spending, but lower premiums that result in more people being able to afford coverage.
Alaska established a reinsurance program for 2017 with state funds, and received approval in July for five years of federal funding to keep it going. As a result, average premiums in Alaska are declining by more than 20 percent in 2018, despite the fact that the cost of CSR has to be added to the premiums.
Minnesota established a reinsurance program to take effect in 2018, and received approval for federal funding in September. However, Minnesota’s reinsurance funding approval came with a funding cut for MinnesotaCare, the state’s Basic Health Program. The state accepted the money for the reinsurance program, and is continuing to negotiate on the MinnesotaCare funding.
Oregon also established a reinsurance program, and their request for federal funding was approved in October 2017. The state credited the new reinsurance program with keeping rate hikes for 2018 in the single-digit range, but after the Trump Administration cut off CSR funding, the Oregon Division of Financial Regulation announced that Silver plan rates would have to increase by an additional 7.1 percent to cover the cost of CSR. However, rates for 2018 would have been 6 percentage points higher without the new reinsurance program.
Iowa also submitted a 1332 waiver proposal that would have created a reinsurance program along with a variety of other changes to revamp the individual health insurance system in the state and reduce premiums. Some of the provisions were controversial, and it was unclear whether HHS would approve the waiver — they had not done so as of late October. At that point, however, Iowa withdrew their waiver proposal.
Oklahoma also tried to establish a reinsurance program, and calculated that rates for 2018 would have been 34 percent lower than 2017 rates. But they were relying on federal funding and the waiver approval process didn’t happen quickly enough for the program to be implemented by the time rates for 2018 had to be finalized, so Oklahoma also withdrew their waiver proposal. The state may try again in the future, and has far-reaching plans to overhaul their individual market using 1332 waivers.
Codifying contraceptive coverage
In October, the Trump Administration announced newregulations — effective immediately — that grant employers wide-ranging access to exemptions from the ACA’s requirement that health plans cover all FDA-approved contraceptives for women.
Throughout 2017, Republican lawmakers have tried to modify the ACA provision that requires all individual and small-group major medical plans to cover the essential health benefits. To varying degrees, they want to allow the sale of less robust coverage again, and put the onus on the consumer to choose well.
One of the ACA’s essential health benefits is preventive care, which includes full coverage for at least one form of every FDA-approved female contraceptive method. This requirement remains in force, as none of the 2017 legislative efforts to repeal or change the ACA have been successful. The Trump Administration implemented regulations in October 2017 that broaden the ability for employers and universities to obtain exemptions from the requirement that their health plans cover contraceptives, and Republican lawmakers have tried repeatedly to advance legislation that would allow individual market plans to be sold without contraceptive coverage.
But more than half the states have some sort of regulations in place that require contraceptive coverage, in some cases without a copay. Here are some examples of the steps states have taken to enhance and protect access to contraception, regardless of federal actions:
For nearly two decades, Hawaii has required state-regulated, employer-sponsored plans to cover contraceptives. And in 2017, the state implemented a new law that allows pharmacists to prescribe and dispense 12 months of birth control.
Oregon passed a law in 2017 (effective in 2019) that requires all state-regulated plans to cover contraceptives at no cost (including vasectomies, which are not required to be covered under the ACA), and also to cover abortions.
Nevada enacted a law in 2017 that requires Nevada Medicaid and all state-regulated plans to cover birth control with no copay, and authorizes pharmacists to dispense up to 12 months of birth control at a time.
New York’s Governor, Andrew Cuomo, took regulatory action in 2017 to require contraceptive coverage on all state-regulated plans, along with coverage for medically-necessary abortions.
A law that took effect in 2016 in Vermont requires insurers to cover FDA-approved contraceptives (including vasectomies) with no copays, and allows women to obtain up to 12 months worth of birth control at one time.
Maryland enacted legislation in 2016 (effective in 2018) that requires coverage for FDA-approved contraceptive (including vasectomies and emergency Plan B contraception) with no copays. It also eliminates prior authorization requirements for long-acting reversible contraceptives (IUDs and implants) and lets women obtain up to six months worth of birth control at one time.
Although the battle over the ACA is likely to be protracted and messy, states have the ability to protect their residents to some extent. Consumers can and should contact their federal representatives to have conversations about health care reform, but they can also reach out to their local leaders to express opinions about strengthening consumer protections at the state level.
There’s an irony here. I’ll keep it a secret for readers who didn’t notice the title.
The public option is popular, in part, because the human experience of the ACA marketplaces is disappointing in many parts of America.
This color-coded map of the continental United States tells the basic story. It shows which party controlled the governorship November 7, 2016, and how many ACA marketplace plans were available in each county. (North Carolina flipped to Democratic control after that.) it shows the number of competing ACA marketplace plans available in each county. The counties in greatest difficulty have only one available plan.
This map yields several insights.
First, Democrats are just terrible at winning gubernatorial elections. Republicans are just killing Democrats outside the coastal liberal states. That’s a huge political consequence of the Obama era.
Second, Republicans are equally terrible at operating successful ACA exchanges. Only one big blue metropolitan area-Philadelphia, PA, was down to one plan. Basically, every other major struggling area is in a red state. Huge sections of southeastern states, Arizona, Oklahoma, and the mountain states are down to one marketplace plan.
This pattern reflects policies in many Republican states that weaken or undermine the marketplace insurance pool. Such policies include rejecting the ACA Medicaid expansion, which places the poorest and most complex consumers into the marketplace insurance pool, “grandfathering” non-ACA-compliant plans to snatch the youngest and healthiest consumers, bad-mouthing and failing to actively administer the law.
Third, big rural land areas such as rural Nevada have very limited marketplace competition.
This last point illustrates how the standard U.S. map distorts our understanding. If cattle and corn fields bought health insurance, we’d have a reasonable fear that ACA is collapsing. But that’s not the reality If we consider the experience of real human beings, the clusters of people in New York City, Los Angeles, Chicago, and Houston are vastly more important than Idaho, Montana, the Dakotas, or Wyoming. Yet these sparsely-populated states occupy vastly more physical space.
The below map may resemble what my editor Steve Anderson saw on his last bad acid trip. It’s actually the same map. Only here, counties are weighted by their populations. The big sparsely-populated Western areas with only one plan virtually disappear.
At one level, this different look suggests that ACA marketplaces are doing pretty well.
Texas – not a diseased heart. (Click for better view.)
Lobster claw? Nope that’s what health insurance competition looks like in Nevada. (Click to enlarge.)
Outside the south, the great majority of Americans live in the shaded areas that have at least two competing insurance plans. The cool maps of Texas and Nevada (at the right) indicate this pattern more clearly.
But at another level, this pattern underscores the poor performance of ACA marketplaces in rural areas. ACA marketplaces work well in densely-populated liberal areas. The marketplaces require more care and feeding to really succeed in Wyoming, Iowa, or Oklahoma. Competition among insurers and providers is pretty thin in these locales.
These areas need substantial public subsidies – as were provided in Alaska – to moderate prices and stabilize the risk pool for marketplaces to really work. It’s hard to imagine Republicans providing the same care and feeding to marketplaces that serve millions more people. It’s equally hard to imagine Republicans in deep-red states such as Alabama or South Carolina genuinely supporting ACA exchanges, when most local politicians view Barack Obama as the only pertinent political home address.
Is a public option hard to imagine? Look at Medicare.
ACA marketplaces may never work well in rural areas. Indeed some of the very same counties lack Medicare Advantage plans, and for some of the same reasons. These areas have too few people for real competition among insurers or among providers. These gaps are not a huge problem in Medicare. Why is that? Because Medicare has a powerful alternative to Medicare Advantage. It’s called traditional Medicare, but it might as well be labeled the public option. Its pricing power keeps prices reasonable. Seniors are essentially insulated from the pricing challenges of rural care.
So here’s the irony: Trump Country really needs a way to bypass the ACA marketplaces entirely. So Democrats’ favorite policy option – the public option – would be most valuable in precisely the deep-red areas that went most fervently for Republicans and for the President.
Republicans seem hellbent on sabotaging the ACA marketplaces over the course of the Trump presidency, for as long as Republicans hold a congressional majority. They might ask themselves where this policy is going.
Democrats would face a real knife fight to enact the public option in 2020 or whenever they win both the presidency and an operational congressional majority. Once enacted, I don’t think the public option would ever be repealed. Most Americans, whatever their political perspective, value this choice.
I’ll make a second counter-intuitive prediction, too. The public option will prove most popular in deepest Trump Country, where regular folk need it the most.
EDITOR’S NOTE: Thanks to the University of Chicago’s Todd Schuble for assistance with the cartograms.
When Senators McCain, Collins, and Murkowski cast their fateful votes, pretty much everyone assumed that ACA repeal had reached its politically ignominious end. The klieg lights, cable TV, and the front page shifted to hurricanes Harvey and Irma. President Trump announced he would let DACA expire. Democratic leaders Chuck Schumer and Nancy Pelosi negotiated what appeared to be a tactically brilliant three-month extension of the debt ceiling. Senator Sanders released his single payer plan. The Senate HELP committee began the process of discussing a much less ambitious, bipartisan bill. The world kind of moved on.
Only a cloud no bigger than a man’s hand was still up there, called the Cassidy-Graham bill. At first, it seemed like a bit of a joke. Arcane Senate rules impose a final deadline of September 30 to pass an ACA repeal based on a simple Republican majority vote. For weeks, no one in Washington took Cassidy-Graham very seriously.
Whoops. Did you think that the never-ending battle over Obamacare was finally … um … ending? Wrong-o. As Louise Norris hints with the theme of the latest edition of Health Wonk Review, there’s still apparently plenty of time for debate on healthcare.
There’s a little bit of that debate in this week’s edition of Health Wonk Review, but also, it’s a mixed bag: there’s a post about how the relentless attacks on Obamacare may ultimately deliver Single Payer and another post about why children’s health premiums are going up in 2018.
But there are also a whole bunch of other great posts not related to health reform at all: a look at the perils of working as a nurse; a post about possible approaches to reducing opioid abuse and a shocking article about the resurgence of hookworm.
That sound you’re hearing – if you’re hearing what I’m hearing anyway – is the diminishing sound of an elephant stampede that has suddenly lost its momentum.
It’s a much welcomed change – the end (we hope) of a turbulent, stressful episode: that being one of the most offensively partisan legislative pushes in American history. Congressional Republicans – heady with the sense of power that comes from gaining control of both houses of Congress and believing their November victory was a sign that they could drive legislation with sheer numbers – came after the Affordable Care Act in what felt to many like a stampede.
Like the crush of an elephant herd, the GOP’s attack on the ACA was a blind rage that threatened to wipe out anything in its path. And what was in its path but millions of Americans – and their ability to pay for coverage and ultimately healthcare?
Dissuading the Republicans was – well – like appealing to rogue pachyderms. No amount of pleading from Congressional Democrats could convince them to “slow their roll” (or bring Dems into the process).
Blind – and deaf – to reason
But it wasn’t Democrats alone who were unable to avert the GOP from their senseless path of destruction. Hell bent on repeal – hell bent on fulfilling a promise they’d been making for seven years – Congressional Republicans refused to listen to a steadily growing chorus of resistance from:
Healthcare groups that warned that repeal of the individual mandate would lead to a sicker group of enrollees and skyrocketing premiums.
The Congressional Budget Office, which scored of the legislation and predicted that millions – and as many as 32 million – would lose coverage.
Republicans ignored them all, believing that brute force and herd size would be enough. Early this morning, they learned they were wrong – and the message came from three brave voices within “the herd.”
Republican Senators John McCain, Lisa Murkowski and Susan Collins had already made noises about the GOP’s partisan and secretive efforts to craft an ACA replacement plan. McCain repeatedly voiced his concern about partisanship during the process. Murkowski, too, had criticized Mitch McConnell’s total control of the legislative process and his secretive approach. Collins, meanwhile, expressed a strong desire to work with both Democrats and Republicans to “fix the flaws in ACA.”
Their pleas had gone unheeded until this morning, when the three sent shockwaves through the Senate chamber by voting No on “skinny repeal,” and bringing the one-sided repeal process to a grinding halt.
Time to look outside their herd
In a speech after the vote, McConnell suggested that it was finally time to work with Democrats.McConnell was wrong. The time to begin working with Democrats was months ago – and since then, the GOP’s stampede to repeal has wasted precious time and increasingly spooked consumers and insurance carriers alike.
Republicans must now abandon their “herd mentality” and open the process to fresh ideas that will produce fixes focused on expanding coverage – not contracting it. At the same time, the GOP and President Trump should act quickly to stabilize the health insurance market and in doing so, make coverage more comprehensive and more affordable for consumers who buy 2018 plans.
For now, though, the roar of the stampede seems to be subsiding – and we eagerly anticipate the soothing sounds of bipartisanship.
The latest edition of Health Wonk Review is posted over at Health System Ed and I’ve gotta say, I appreciate the theme. (We all certainly deserve some kind of a lull – and yes, I’m talking about a lull in the repeal battle.)
In this week’s edition of Health Wonk Review: groovy cartograms and more.
And while there is a bit of a lull in the repeal battle right now, there obviously was not a shortage of health reform-themed posts for host Peggy Salvatore to sift through this week:
The posts have fun titles like “The Creation of ObamaCare’s Individual Market Mess” and “What the US Healthcare Reform Debate Did Not Address.” and Harold Pollack’s Who Really Needs the Public Option? Trump Country. (Thanks, Peggy!) There’s also a super explainer about actuarial value from Louise Norris.
There’s more, but the edition’s a quick read and – as always – loaded with great posts, so go check it out.
President Trump might unwittingly, or, for all we know, wittingly – who really has a clue what’s going on in that mind of his – hasten the day when we Americans become the next developed country with a single-payer health care system.
That’s right. For all of the years of effort expended by single-payer advocates, and for all of the urging of liberal-leaning leaders like Bernie Sanders, Donald Trump may be the person who almost single-handedly pushes our healthcare system into single-payer territory.
Repeal efforts have set the stage for single-payer.
Trump and Republicans have been giving the single-payer movement a solid push for months. In their efforts to repeal the Affordable Care Act, they’ve opened Americans’ eyes to what they stand to lose if the ACA’s consumer protections are rolled back. Mostly, they’ve put the spotlight on pre-existing conditions and reminded consumers that for decades, they’d been missing out on protections that other countries have been providing.
As a result, during the repeal battle, we’ve heard a growing rumble from consumers saying things like, “Yes. The system is a mess. Couldn’t we solve all of this by moving to single-payer?”
And now, President Trump is poised to knock us into the single-payer end zone. Frustrated by and annoyed with the Republican-controlled Senate for failing to repeal the health law last week, the president tweeted that Congress should just “let Obamacare implode, then deal.”
In truth – and he might even be aware of it by now – the president doesn’t need Congress to let it implode. He can do it all by himself, unless Congress acts in the next two weeks to keep him from doing it.
Step 1 to single-payer? Kill CSR payments.
What President Trump can do is cut off cost-sharing-reduction payments – which he has referred to in tweets, erroneously, as a “BAILOUT” to the insurance industry – that enable low- and moderate-income folks afford to actually use the policies they buy from health insurance companies.
Here’s the background: Knowing that many people who enrolled in high-deductible plans would not be able to cover their out-of-pocket expenses without financial assistance from the government, Congress authorized the executive branch of government – which Trump now controls – to provide subsidies to low- and moderate-income individuals and families so they wouldn’t have to forego needed care.
The value of those subsidies cannot be overstated. Insurance companies that want to continue offering coverage know that if the president decides to end the subsidies, they will have no choice but to hike premiums so high that many of their customers won’t be able to afford what they’re selling.
Only the sickest who have the means to buy coverage will remain. The young and healthy and less-well-off will drop out of the market and pray they’ll go another year without getting hit by a bus or stricken by some life- and bank-account-threatening disease. That will lead to the dreaded death spiral that causes insurance markets to collapse. That’s not a theory. We’ve seen it happen time and again in this country.
At the same time, insurance company executives who decided they can’t tolerate for much longer the uncertainty about what President Trump might do could simply say, “We’re outta here.”
That, folks, is what letting Obamacare implode would look like. And people – not insurance company executives or President Trump’s family or members of Congress – people you know and love, maybe even you, will die. That is what is at stake. Nothing less.
Out with Obamacare. In with single-payer?
President Trump will think he’s punishing Democrats by letting the system implode. He’ll think he’s reminding the GOP that it needs to follow his dictates – or else. But he’ll really just be adding fuel to the single-payer fire.
(It’s quite possible that deep down President Trump wants a single-payer system. Why else would he tell voters on the campaign trail last year how much folks in Canada and Scotland – where he has a fancy golf resort – like their healthcare? And then just a couple months ago he told Australian Prime Minister Malcolm Turnbull how much better the Australian system is than ours. Maybe he’s thinking, as some single-payer supporters do, that the collapse of Obamacare might be a necessary step on the way to single-payer health care in this country.)
Single-payer advocates were so upset with how special interests helped write what became Obamacare that they urged members of Congress to “kill the bill.” They felt it was so flawed, so skewed in favor of the insurance industry, drug companies, big hospitals chains, medical device manufacturers and already-rich doctors that Congress should start over and try to do better.
They had a point. Yes, Obamacare has reduced the ranks of the uninsured, but it has done far too little to control either medical inflation or the rapid growth of high-deductible plans. For-profit insurance companies like the ones I used to work for are making record profits as they are able to shift more and more of the cost of care from them to us.
And now, single-payer advocates will have even more ammunition. Public opinion polls are showing that rapidly growing numbers of us are warming up to the idea of single-payer health care. When I’ve discussed the topic with my single-payer friends, some believe Americans are finally fed up enough with Obamacare’s shortcomings and with poorly crafted replacements. They see that our some of our most vulnerable have made gains, but not enough. Not by a long shot.
I have no doubt that if President Trump follows through on his tweeted desire to see Obamacare implode – just to see what happens, regardless of the collateral damage – we will be a single-payer country sooner rather than later.
After six months of attempts by Donald Trump and Congressional Republicans to repeal the Affordable Care Act, their success in achieving a legislative victory remains uncertain. What’s not uncertain at all? That their attempts are weakening the law’s protections, decreasing coverage options, and driving up costs for consumers who desperately need affordable coverage.
That’s right. Although there have been numerous predictions that any of the Republican repeal bills floated thus far – in the House or Senate – will end up hurting consumers, the fact is that consumers are already on a path toward higher premiums and fewer available plans as they shop during the open enrollment period this fall. That’s regardless of what happens in Congress this week or next.
The good news is that Republicans – and President Trump – could act right now to reassure the health insurance industry and in doing so stabilize the individual health insurance market. Could it really be that easy, you ask?
The individual mandate has carriers spooked.
Throughout 2017, when GOP lawmakers have talked about repealing the ACA (aka, Obamacare), they’ve generally described a transition period ranging from two to four years, and have insinuated that nothing would change in terms of coverage availability in the near term. And it’s true that the bills that have been introduced thus far do tend to incorporate delayed implementation for some provisions, but notably, all of them would eliminate the ACA’s individual mandate penalty retroactively to the start of 2016.
A big part of the reason that people would drop their coverage is the circular relationship between higher premiums and lower enrollment: The CBO projects that premiums will increase by 20 percent (in addition to the amount they would otherwise increase) in 2018 if the individual mandate penalty is eliminated. Essentially, the elimination of the mandate penalty leads to lower enrollment among healthy people which leads to higher premiums, which in turn leads to even lower enrollment.
Insurers are reacting to the threat.
But again, that’s if the legislation is passed into law. Right now, the mere oft-repeated Republican desire to repeal the ACA’s individual mandate is spooking insurers during the time when premiums for 2018 coverage are being established.
And the rate justifications that insurers are filing for 2018 indicate that they are absolutely proposing rates that are higher than they would be proposing if the Trump Administration and Congress weren’t trying to undermine the ACA.
If Congressional Republicans do pass a bill that eliminates the individual mandate, premiums will clearly be significantly higher in 2018. But the uncertainty caused by the Trump Administration’s reluctance to enforce the individual mandate, and the fact that lawmakers are considering eliminating the penalty altogether, is already driving premiums higher than they would otherwise be for 2018, even if the ACA repeal efforts eventually fail.
Right now, Congress could take a lot of pressure off the carriers by simply acknowledging that they understand this: without a mandate, the risk pool is threatened, and carriers will continue to adjust rates accordingly.
Another threat: loss of cost-sharing reductions
The battle over funding for cost-sharing reductions is causing uncertainty for insurers.
House Republicans won the case in 2016, but the Obama Administration appealed, and CSR funding has continued to flow to insurers. But if the Trump Administration were to drop the appeal, that would no longer be the case.
This quick fix would soothe insurers and lower rates immediately.
Insurers say rates could still be lower.
But don’t take my word for it. Here’s what some insurers and insurance regulators have said about individual health insurance rates for 2018:
In Pennsylvania, average premiums are expected to rise just 8.8 percent in 2018 if the individual mandate is enforced and cost-sharing subsidies are funded. If neither of those things happen, average rates in the state will climb by more than 36 percent.
In Colorado, the average proposed rate increase is 27 percent. In explaining the rate proposals, Colorado’s Insurance Commissioner noted that “because of what is happening at the federal level, there is still a great deal of uncertainty in the marketplace.”
In Washington, the average proposed rate increase is more than 22 percent, but would be under 11 percent without Trump/GOP sabotage. Washington’s Insurance Commissioner explained that “the uncertainty the Trump administration and the GOP-controlled Congress has sowed for months is sabotaging the progress we’ve made. Their actions, including failing to commit to fund the cost-sharing subsidies, not enforcing the individual mandate, and continuing to push in secret the severely flawed American Health Care Act [the bill the House passed in May] are eroding confidence health insurers have in the market here and across the nation. These actions only increase premiums and decrease insurer participation.“
Blue Cross Blue Shield of North Carolina, which insures the bulk of the state’s ACA-compliant individual market, has proposed an average rate increase of 22.9 percent for 2018. But they explained in their rate filing that 14 percentage points of that is due to the assumption that the federal government won’t commit to funding CSRs.
Blue Cross Blue Shield of Tennessee has proposed an average rate increase of 21.4 percent. But virtually all of it is due to Trump/GOP sabotage. Their rate filing notes that 14 percentage points are due to concerns that CSRs won’t be funded, and 7 percentage points are due to concerns that the individual mandate won’t be strongly enforced.
Right now, the individual market is facing another round of steep rate increases for 2018, but it doesn’t have to be that way. Last year’s rate hikes seem to have been enough to get the market on fairly stable ground, but the ongoing uncertainty and sabotage at the federal level has thrown a wrench into the works, and is causing premiums to rise much more in 2018 than they otherwise would.
Insurers know who’s to blame.
Insurers do not like uncertainty. And the Trump/GOP repeal debacle is creating uncertainty in a big way.
The Trump Administration announced in July that 141 insurers had applied to offer coverage via HealthCare.gov in 2018 – down from 227 that applied last year. In their announcement, they didn’t acknowledge the role that they’re playing in causing the decrease in insurer participation. But insurers and insurance commissioners are pointing it out:
Colorado Insurance Commissioner, Marguerite Salazar explains that “insurance companies have indicated to the Division that they may be forced to reevaluate their participation in the marketplace if the lack of clarity at the federal level continues.”
In Delaware, Highmark is expected to be the only insurer offering plans in the exchange in 2018. And the Delaware Department of Insurance noted that “if the Federal Government fails to live up to its obligations under the law, insurers will likely continue to exit the Marketplace.”
Insurance giant, Anthem, currently offers exchange plans in 14 states. But they’re exiting the exchanges in Indiana, Ohio, and Wisconsin at the end of 2018. They’ve noted that this is due in part to the “uncertainty” surrounding the federal government’s approach to the ACA. Anthem has also made it clear in the remaining states that their continued participation hinges in large part on the Trump Administration’s willingness to continue to fund CSRs.
The sabotage can stop.
Congressional Republicans’ path to a legislative victory on ACA repeal is much less likely now than it seemed last November. Due to the division between moderates and conservatives within the caucus, there is a good chance that they won’t be able to enact legislation on this issue.
As this became increasingly clear in July, Trump was unequivocal in how he wanted to approach the situation. His plan is to “let Obamacare fail,” and he clarified that when this happens, he’s “not going to own it.” Incidentally, that’s not how it works when you’re President – the buck stops with you, whether you want it to or not.
Stop the PR campaign. Under Trump, the Centers for Medicare and Medicaid Services (CMS) have been directly criticizing the ACA in recentpressreleases. They are also spending money – that was allocated to advertise the ACA and promote enrollment – on a social media campaign designed to build opposition to the ACA.
Stop strangling enrollment efforts. Trump took office less than two weeks before the end of open enrollment for 2017 coverage. Almost immediately, advertising and outreach for HealthCare.gov was reduced, leading to lower enrollment in HealthCare.gov states (while state-based exchanges, which run their own marketing, saw an increase in enrollment).
There are concerns that the Trump Administration will continue to sabotage enrollment by reducing advertising and outreach throughout the upcoming enrollment period, cutting back on call center assistance, or reducing the efficiency of the HealthCare.gov website. Indeed, this is already happening, with the Trump Administration already taking steps to reduce enrollment assistance in 18 cities. In New Mexico, Christus Health Plan noted in their rate filing that part of their proposed rate increase for 2018 is due to their expectation that there will be “reduced advertising and outreach” for HealthCare.gov.
End the uncertainty. There are also universal concerns among insurers that part of Trump’s plan to “let Obamacare fail” could include dropping the House v. Price appeal, or further weakening the enforcement of the individual mandate. Either or both of these actions would result in a much less stable individual market, with higher prices and fewer insurers participating (ironically, higher prices mean that the federal government has to spend more on premium subsidies, which will still be available in the exchanges in 2018 regardless of what happens in Congress or in the White House).
Affordability and plan quality? It’s up to the GOP.
What does all of this mean for consumers who need to buy health insurance for 2018?
Open enrollment will begin as scheduled on November 1, 2018, and you’ll have 44 days to pick a plan. Regardless of what ends up happening in Congress, it appears that we’ll be facing higher premiums and fewer available plans.
Can Republicans change any of that? Yes – by taking the steps noted above. But they could also abandon their secret, partisan approach to healthcare reform. And the Trump Administration could check its not-so-secret efforts to derail the ACA.
Minus an obvious effort by the GOP, consumers who buy their own health insurance will face higher premiums and fewer options in November. And Congressional Republicans and the Trump Administration will owe them an explanation. And an apology.
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