California: Health plan rates could jump if key ObamaCare payments end

Cheryl Sanders
August 5, 2017

MORE (D-Wash.) - the chairman and ranking member of the Health, Education, Labor and Pensions Committee - announced bipartisan hearings meant to craft a short-term market stabilization proposal by mid-September.

Many insurers are already asking for hefty premium hikes amid the uncertainty over the cost-sharing subsidies and the Republicans' desire to dismantle the Affordable Care Act. As I said from the beginning, let ObamaCare implode, then deal.

The order potentially helps the states in other ways.

The 2010 law set up health insurance for members of Congress and their staffs through the District of Columbia health care exchange.

The Texas insurer, CHRISTUS, said 15 percent of the 36 percent increase it is seeking is made up of covering additional costs if the government does not pay the subsidies or stops enforcing the requirement that individuals have insurance. People with insurance from other sources must still contend with soaring costs, coverage shortfalls and many inefficiencies of the American system.

"The bottom line is, providers see population health management as something they need to do and that they want to do to provide better care for patients, but they are struggling with the economics of operating in both the fee-for-service and value-based care worlds - having one foot in each canoe", Amy Flaster, MD, vice president of population health management and care management for Health Catalyst, said in a statement.

Insurers rely on the subsidies, technically cost-sharing reduction payments, to lower the deductibles and co-pays of single enrollees who earn less than $30,000 a year and families of four making roughly $61,000.

Although Trump's tweet may suggest otherwise, members of Congress and their staff get their health insurance through the Obamacare exchanges.

"A first critical step in stabilizing the individual health insurance marketplaces is to fully fund CSRs for the remainder of calendar year 2017 through 2018", the governors said in a statement. One of those Republicans is Tennessee's Lamar Alexander, Senate health committee's chairman. But that won't happen soon as the issue is off the table in the U.S. Senate for now.

"We are working closely with the Baker-Polito Administration and with the Division of Insurance and insurance carriers to explore a re-rating process for 2018, if necessary, as part of our goal to limit disruption to ConnectorCare members and our insurance market", Lefferts said.

The White House has given mixed messages on when the president would make a decision about the subsidies. In addition to the insurers' September 27 deadline, the next CSR payment is due on Aug. 21, so "if the administration intends not to make the August payment, it must announce its decision soon", wrote Timothy Jost, JD, professor of law emeritus at Washington & Lee University, in Lexington, Va., in a blog post for Health Affairs.

The Obama administration appealed to the DC Circuit.

The payments are the subject of a lawsuit brought by House Republicans over whether the health law specifically included a congressional appropriation for the money, as required under the Constitution.

This new wrinkle "will complicate any effort by the president to quickly end the subsidies", Sparer noted. Previously, Congress enjoyed a hefty subsidy courtesy of the Federal Employees Health Benefits Program. "It's not clear that the Republicans and the Democrats are trying to solve the same problem". The underlying implication was that Trump, who ran against Obamacare, would consider dropping the administration's defense of the subsidies.

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