WASHINGTON — With Republicans unable to scrap Obamacare, several lawmakers huddled last week with a new purpose: fix a law that, depending on the perspective, either had some mendable flaws or was irrevocably broken.
A group of more than 40 bipartisan House members — they call themselves the Problem Solvers Caucus — vowed to create a stability fund that states could use to reduce premiums and limit insurer losses; change the mandate that employers provide coverage only to companies with 500 or more employees, as opposed to the current 50-employee requirement; and repeal the medical device tax, among other provisions.
And in the Senate last Tuesday, Senate Health Committee Chairman Lamar Alexander, R–Tenn., and ranking Democrat Patty Murray of Washington, announced they were scheduling hearings beginning the week of Sept. 4 on how to stabilize and strengthen the individual health insurance market.
Sen. Rob Portman, R–Ohio, applauded the latter effort, saying “going back through regular order might be a successful way to deal with it — nobody can be happy with the status quo, with the rates going up dramatically.”
“This is what we wanted all along,” said Sen. Sherrod Brown, D–Ohio, of the Alexander-Murray announcement. He said Murray and Alexander “want to make sure the subsidies continue, want to make sure and stabilize the insurance markets and bring more young healthy people into the insurance pools.”
Gov. John Kasich, who has long urged a bipartisan effort, called the planned hearings “another strong step in the right direction.”
With plans for a dramatic overhaul of the 2010 law officially known as the Affordable Care Act set aside for now, the consensus seems to be forming around stabilizing marketplaces where individuals without employer-sponsored health coverage or tax-funded insurance like Medicaid can buy coverage from insurers.
“Even if you disagree with the Affordable Care Act, you don’t want to destabilize markets,” said Loren Anthes, a fellow with the Center for Community Solutions, a nonpartisan think tank based in Cleveland.
The key, he and others say, is maintaining tax-funded payments to insurance companies to reimburse them for waiving deductibles and co-pays to the poorest consumers as required under the law.
Eliminating the $7 billion in annual payments, as President Donald Trump is threatening to do, likely would cause insurance companies to increase premiums for all consumers to make up for the loss or leave the market entirely. The Kaiser Family Foundation projected premiums would jump 19 percent.
If Trump follows through, it would “send shock waves through the insurance market” and shift costs to consumers, warned Andy Slavitt, a former Obama health–care official. “They should work together to make the law better.”
Tom Miller, a resident scholar at the conservative American Enterprise Institute, said that Trump’s threats are just that — threats.
Avoiding a worst fix
“Trump is basically close to saying, ‘you take one more step and I’ll blow up everything,’” he said. “It’s not a valid threat. It’s just a very empty bluff, because what would you do next? You don’t get any political mileage out of making everyone’s life worse.”
Should Trump not make the payment, insurers still would be required to offer lower deductibles to low-income patients; they just wouldn’t get paid for it, said Larry Levitt, senior vice president of the Henry J. Kaiser Family Foundation. To break even, he said, they likely would raise premiums or exit the market altogether. Abandoning the subsidies, he said, “could put enormous pressure on Congress to figure out what to do to stabilize the market in the face of this uncertainty.”
Levitt disputes the idea that the marketplaces are “imploding,” as Trump suggests, but he does admit that the markets are fragile, particularly in rural areas. In Ohio, the Department of Insurance announced last week that it had found an insurer for 19 of the 20 counties that had been left without a carrier when Anthem Blue Cross Blue Shield and Premier Health announced they would exit the market in 2018.
“All signs point to (the market) stabilizing in most of the country,” Levitt said.
But, he said, problems remain. Many rural counties have only one insurance company in the exchange, offering limited choice.
And beyond that, insurers have submitted their initial rates to state regulators for 2018, and in some cases, the increases are steep — in large part because of the uncertainty around with the debate in Congress.
In Ohio, initial filings with the Department of Insurance from insurance companies show rate increases of 20 percent or higher — assuming federal subsidies stay in place — although state officials reviewing those plans caution that rates likely will change before they are finalized in September.
Stabilizing insurance costs
Kasich and a bipartisan group of governors have recommended that Congress focus on controlling costs and stabilizing the private health insurance market to ensure access to affordable health care.
“This isn’t a partisan issue,” said Colorado Gov. John Hickenlooper, a Democrat. “We know we need to make improvements, we need to control costs but we don’t want to roll back coverage or weaken markets.”
Greg Moody, director of Kasich’s Office of Health Transformation, said the administration is encouraged by the bipartisan “effort to stabilize the health insurance market. It’s an approach that the governor has long advocated, and one consistent with the message from our coalition of Republican and Democrat governors. Ohio has been a leader in health care reform, and we stand ready to share our experience and expertise with Congress and the administration.”
Anthes said Congress also could seek consensus on ways to reduce rising costs of health care and prescription drugs if they avoid “getting into the political quagmire of coverage.” Costs also can be reduced with programs to expand preventative care to keep people healthy, care coordination, and home-care services that allow people to stay out of expensive institutional care.
Can massive overhaul work?
Amy Rohling McGee, executive director of the Health Policy Institute of Ohio, said increases in health care spending are unsustainable and at some point “we need to get to the real issues of spending and health outcomes.”
“The fundamental problem is health care is too expensive. If we make coverage more affordable, the (individual) mandate becomes less of an issue,” said Mario Molina, former head of Molina Healthcare. “People want to buy insurance if its available and affordable.”
Though Trump wants Congress to continue to work on a repeal-and-replace effort, and Senate Majority Leader Mitch McConnell backs such a move, Levitt, like Miller, doubts that Congress will have much of an appetite for massive overhaul. More modest efforts, like Alexander’s and Murray’s attempt to stabilize the market, are far more likely.
“There is tremendous health-care fatigue in Congress,” Levitt said. “I think it’s hard to imagine a high profile effort to deal with health care at this point.”
The problem isn’t just disagreements between Democrats and Republicans, Miller said.
“If you put all the Republicans in a phone booth, they couldn’t agree on what number to call,” he said.