Healing Health Insurance

Short Term Rx:

Fortunately, while the House passed their version of Health Care Reform, the Senate did not pass any Reform bill. Which leads us to the current environment of how the process should work. The GOP approach to working in secrecy without input from stakeholders such as insurance commissioners, state governors, insurance companies among others led to flawed bills. The good news is that Senator Alexander said on (9/8/17) that he hopes to release a bipartisan health care bill within 10 days or so

The primary issue is the uncertainty of whether Trump and/or Congress will continue to approve the payment of the cost-sharing subsidies to insurers which result in lower premiums. And, in a letter to Senator Alexander and Senator Murray from the American Medical Association, America’s Health Insurance Plans, American Hospital Association, U.S. Chamber of Commerce among others, it is requested that the cost-sharing subsidies be guaranteed for two years. And state insurance commissioner have identified this as the single, most critical issue as NAIC to Trump, Congress: Fund CSRs.

Insurance commissioners who have varying degrees of oversight over health insurance companies including the authority to approve, reject or modify coverage rates will be central to keeping the health insurance markets stable. The reality is that State insurance commissioners (are) under pressure in health-care drama. 

On Wednesday, five insurance commissioners testified to the Senate H.E.L.P. committee with multiple recommendations including Oklahoma Insurance Commission John Doak to Senate Panel: Audit the ACA Navigators, make use of existing ACA Rule waiver program earlier, keep existing ACA subsidy programs in place until and unless new market rules replace the current ACA rules, recognize that changing an insurance plan takes time, consider letting individuals team up to buy health coverage, remember that each state has its own problems, invest in advertising for the individual major medical open enrollment period for 2018 and to be open minded about navigators. Basically, the bottom line, is that changes need to be made slowly and carefully because as Insurance Commissioners Say Help Offered By Congress Is Not Enough To Save Market.

State Governors who play a major role in the implementation of health insurance are also getting involved and will be testifying before congress this week as Republicans flirt with 'B' word on health care: Bipartisanship. Eight state Governors Propose Health Insurance Market Stabilization Plan in a letter to Congress that would control premiums and improve competition in the federal and state health insurance exchanges. 

Another move by the Trump administration was shortening the open enrollment period in half from last year’s three month open enrollment period. This year’s open enrollment period will be from November 1 to December 15, 2017. Having a shorter open enrollment period is a positive move, however if consumers don’t know that the enrollment period has changed, it will lead to lower enrollment. Longer term a shorter enrollment period is a key to stabilizing the health insurance market. So, California, Other States To Extend Obamacare Sign-Up Beyond Federal Limit. In the shorter term, Andy Slavitt, who ran the Centers for Medicare and Medicaid Services under former President Obama, says a 90% cut in ad spending means a "dramatic cut" to ACA enrollment next year — “which means a worsening risk pool, higher government outlays, less competition, and higher premiums paid by American families."

Are the kids alright?

In the midst of the greater health insurance discussion, the issue of renewing the Children’s Health Insurance Plan (CHIP) needs addressing as this federal programs providing health coverage to over 9 million children needs to be renewed by Congress by September 30, 2017. With all of the pressing concerns, Congress’ Tight Timetable Complicates Renewal Of Children’s Health Plan. 

Long Term Rx:

While there are many issues to fix in the health insurance industry, the bottom line is that to some degree insurance companies pass on the claims paid and add on their expenses and profits. While this an oversimplification, insurance premiums are a reflection of the cost of insuring a risk. And when you have insurance that covers a risk whose costs rise, premiums will rise. It’s simple math, if insurance companies pay out more, they will charge more in premiums.  

According to Tennessee Insurance Julie McPeak who is also the President of the NAIC, here are three other issues that need to be addressed as soon as possible:

1. Establishment of a reinsurance or high-risk pool program to help relieve insurers of the costs of the sickest patients.
2. Modify state waivers, the ACA’s Section 1332 waivers as those have to be approved by state legislators who may not be in session when approval is needed. 
3. The long term overall sustainability of the ACA should be reviewed by Congress.

According to a map recently released by CMS, 1,476 counties consisting of roughly 2.6 million ACA participants would have access to only one insurance company next year. Bloomberg is tracking insurance company participation on their website: Failing or Doing Fine? How Obamacare’s Marketplaces Are Shaping Up for 2018.

Deductibles are rising much faster than premiums, as is the number of Americans covered by employer-based health plans that carry high deductibles, according to a new analysis funded by the Robert Wood Johnson Foundation. The average deductible to cover one person was $1,696, 10% higher than the year before.

Even in retirement, health care is one of the largest costs. Fidelity investments has just released a study showing that Health Care Costs for Retirees Rise to an Estimated $275,000 Fidelity Analysis Shows. 

Affordability and rising health care costs should really be the main issue. If a move was made to standardized (legitimate pricing), it is estimated that health care costs could be trimmed by 1/3. The bottom line is that there are no actual set prices for medical services. The price you pay depends on if you are paying cash out of pocket or what insurance you have. In any other business, this would be considered predatory pricing. It is impossible to move forward unless health care costs are transparent and based on actual costs. For example, U.S. hospitals charge private insurers more than 50 percent over Medicare rates.

The most recent official U.S. projection by the Centers for Medicare & Medicaid Services projects that total national health costs will continue to be driven by rapid growth in medical pricing: Throughout the 2016-25 projection period, growth in national health expenditures is driven by projected faster growth in medical prices.

A single-payer health insurance plan is not the answer either. As outlined in A Health Insurance Roadmap, there must be a public and private partnership such as exists with Medicare through Medicare Advantage and Medicare Supplement plans. As a start, Senator Debbie Stabenow has introduced the Medicare at 55 Act which would be a step in this direction and the bill has seven sponsors. The bill would allow an individual between the ages of 55 & 65 to buy into Medicare and receive the same benefits and protections as an individual enrolled under Medicare Parts A, B and D. Keep in mind that Medicare enrollees pay premiums for Parts B & D, so the government’s cost is for Part A. Medicare Part A is free for most Americans already. Medicare Part A is mostly free for most Americans already due to the Emergency Medical Treatment and Labor Act of 1995. Medicare Part A covers emergency health care services (hospitalization)/

The guests who overstay their welcome:

And because moving on is hard to do, Republican Senators Cassidy (LA), Graham (SC) and Heller (NV) are still pushing their proposal for ACA repeal. Like all of the proposed Senate GOP plans, it creates more issues than it solves. What’s different is is that it would end premium tax credits, cost-sharing reduction payments, and enhanced Medicaid expansion funding by 2020, and replace with block grants, which could be used to provide coverage, stabilize markets, reduce cost-sharing, and provide wraparound coverage for persons in the expansion group. The Kaiser Family Foundation has it’s usual informative Summary of Graham-Cassidy-Heller Amendment.

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