Friday, 21 September, 2018

The Health Insurers Squawk

Another challenge for Obamacare — and a bigger bill for taxpayers Maryland insurers say Trump Administration to cut health payments destabilizes market
Gustavo Carr | 14 July, 2018, 02:53

More than a dozen co-ops have failed since the ACA's implementation, and most have blamed the risk adjustment program.

The excuse Seema Verma, the administrator of the Centers for Medicare and Medicaid Services, is giving is that they believe the navigators don't sign up as many people as private entities like insurance brokers.

Florida Blue, an insurer that enrolls among the largest number of Obamacare consumers nationwide, said it won't miss the help from the federally funded grass-roots helpers.

CMS stopped the payments after a federal court found the formula used to calculate them flawed earlier this year.

The administration argued in its announcement that its hands were tied by conflicting court rulings in New Mexico and MA.

Health insurers warned that the action could drive up premium costs and create marketplace uncertainty.

The ambiguity involved in the conflicting New Mexico and MA rulings may mean the suspension of payments will indeed be temporary.

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Sen. Ron Wyden of OR, the ranking Democrat on the Senate Finance Committee, said in a statement that urging navigators to promote non-ACA plans amounts to "federally funded fraud: paying groups to sell unsuspecting Americans on junk plans that allow insurance companies to deny care on a whim and charge whatever they want is nothing but a scam".

Nonetheless, the timing is problematic. The fund would be separate from the federal risk adjustment payments and could allow the insurers to reduce their requested rate increases by as much as 30 percent. The insurers have requested average rate increases for 2019 that range from 18.5 percent to 91.4 percent, depending on the type of plan.

What is usually referred to as risk adjustment payments, aims to protect insurance companies from making hefty losses during their service delivery to the people. "It's just choosing not to exercise them", he said.

Obamacare surges on, with the public continuing to approve of it and health insurers coming back to the markets after sitting a year ago out. "As a result of this litigation, billions of dollars in risk adjustment payments and collections are now on hold". Block grants to the states would be based on ACA subsidies and the cost of Medicaid expansion "as of a fixed date", i.e., frozen, putting "federal spending on real budget", according to the plan. "Costs for taxpayers will rise as the federal government spends more on premium subsidies", said a statement from America's Health Insurance Plans, a health insurance industry trade group.

Even if the risk-adjustment payments are merely delayed, not canceled, insurers will likely incur unanticipated expenses related to the delay in cash flow, which could prompt premium hikes, he says. Tuesday's announcement and details in an accompanying grant notice were the first information the CMS has provided this year. The counselors, known as navigators, help consumers find an affordable health plan on the ACA exchanges.

Over the past year, the White House has issued a number of executive orders and undertaken administrative actions to undercut the program popularly known as Obamacare.

Navigators applying for the federal money will now be asked how they educate customers on new alternatives to the ACA that were put in place by the Trump administration. So-called association health plans do not need to follow the rules for policies sold under the ACA, which means they do not need to provide coverage for services deemed "essential" by the ACA.