Insurers confront big ObamaCare decision

Insurers are nearing the deadline for deciding whether to propose massive rate hikes or leave the ObamaCare markets altogether in the face of immense uncertainty over the future of the law.

The federal deadline for insurers to file rate proposals with the federal government is June 21. Many insurers had been hoping that the Trump administration would say for certain whether it would continue to pay cost-sharing reduction (CSR) subsidies for covering low-income enrollees.

{mosads}No such assurances from the administration appear to be coming, leaving insurers with a difficult choice.

Next week’s filings will give the most comprehensive look yet at what the ObamaCare markets could look like next year. It’s not clear whether the Trump administration will make the requests public, though sometimes individual states will release the information for their insurers.

Still, early filings already show several insurers requesting double-digit rate increases. Some have already announced they won’t participate in the law’s marketplaces next year, leaving an unprecedented 47 counties with no options on the exchanges for 2018.

“We’ve seen so far pretty high premium increases in a number of states. Some of that seems to be because of uncertainty insurers are facing over CSR payments and individual mandate enforcement,” said Cynthia Cox, an insurance expert with the Kaiser Family Foundation.

“If we do get information on premiums, I would expect to see some of those premiums quite high.”

 Filings could also show what counties could be “bare” next year, in addition to the 47 already accounted for.

In Delaware, Highmark on Wednesday requested a 34 percent increase for marketplace plans for 2018. That request was made under the assumption that the insurer payments would not continue and that ObamaCare’s individual mandate to have insurance would not be enforced.

Anthem’s announcement last week that it would pull out of Ohio will leave 18 counties with no provider next year, unless another insurer steps in.

Insurers all over the country have followed a similar pattern.

In Washington state, two counties are slated to have no insurers on the exchanges next year, something that Washington Insurance Commissioner Mike Kreidler partially blamed on the Trump administration.

“No. 1, by far, is what’s happening at the federal level with CSRs not being funded in a multiyear fashion so there’s predictability, and you have an administration that’s already indicating they’re not going to enforce the individual mandate,” Kreidler said.

Kreidler said his office has partnered with insurers to send two letters to the Trump administration and Congress “trying to get their attention.”

They received a response, he said, but “it wasn’t that helpful.”

“The message we’ve been getting is we think [ObamaCare is] going to be repealed, therefore making a real investment in stabilizing the Affordable Care Act [ACA] doesn’t seem like a prudent action at this time,” Kreidler said.

He said he’s working with insurers to stabilize the market in Washington, which could involve a reinsurance program that reimburses insurers for taking on high-cost enrollees.

Some Republican leaders have also called on Congress or the Trump administration to act quickly to stabilize the markets and calm insurers.

House Ways and Means Committee Chairman Kevin Brady (R-Texas) said he’s working with leadership and the administration on a way to stabilize the markets and argues that the CSRs should be funded.

“I think Congress should legally and temporally fund those payments so we can lower those premiums during the transition,” Brady told reporters this week, adding that there has been no decision yet on the “vehicle for doing this.”

“Insurers have told us that not having these payments are significantly increasing the proposed 2018 premiums. When these cost-sharing reduction payments are made, patients should expect to see their premiums significantly reduced and so on.”

On the other side of the Capitol, some GOP senators have also pushed for a short-term fix for ObamaCare.

“I’ve been out there by myself saying I think we should act quickly and stabilize the markets,” Sen. Ron Johnson (R-Wis.) told The Hill this week.

“Insurance companies have to start making decisions right now. We’re starting to see them making decisions about potentially pulling out of different states. … We have governing authority, so we should do something to try to stabilize those, do things we may not necessarily support, but we have to stabilize the markets.”

It’s not clear what action, if any, the administration plans to take on ObamaCare.

Seema Verma, the administrator of the Centers for Medicare and Medicaid Services (CMS), said for the first time this week that the administration will work to address the issues with bare counties.

 “CMS continues to work with state departments of insurance and issuers to address bare counties, exploring all options available under current law to provide Americans with access to coverage,” Verma said in a statement.

Asked for more information, a senior CMS official said the agency is “committed to continuing to maintain an open dialogue with governor’s offices and state insurance departments to provide as much flexibility as possible on timelines and other burdens as a result of the ACA that have made it difficult for carriers to participate.”

Verma said the CMS has provided guidance to help states obtain waivers to create high-risk pools or reinsurance programs to “incentivize carrier participation.”

Iowa, which is in danger of having no insurers on its exchange next year, is seeking one of those waivers, asking the federal government for permission to change ObamaCare’s tax credits and to set up a reinsurance program.

Meanwhile, insurers have another federal deadline in August to submit final changes to their plans, meaning they can still raise rates or drop out of the exchanges after this month.

That also means Congress and the administration still have time to try to stabilize the markets in some way, though their options are limited, according to Cox.

“It is hard to make any changes to the rules for next year. It’s possible, but insurers would have to go back to the drawing board, redesign plans and premiums and come with a new proposal. So the clock is ticking,” she said.