Insurers claim they are losing money in the health insurance marketplace under the Affordable Care Act because some high-cost patients receive charitable help to pay their premiums, threatening the risk pool.
As the Obama administration considers changing rules about third-party payments, its focus needs to be on the patients.
The CMS has called for public comments, which are due Sept. 22. Undoubtedly, the insurance industry will pressure the CMS to halt third-party payments altogether. Insurers have been angling for this since 2014, when they tried, unsuccessfully, to reject payments to exchange plans assisting HIV/AIDS patients. It took a CMS rule to stop them.
The CMS is concerned that some providers may have inappropriately steered patients toward higher-reimbursement exchange plans instead of Medicare or Medicaid. If true, this must stop. The not-for-profit American Kidney Fund runs America's oldest and largest federally approved charitable premium-assistance program, helping low-income people with end-stage renal disease. Today we help about 6,400 ESRD patients nationwide to access exchange plans—a small fraction of our overall grant population, and a minuscule percentage of total marketplace enrollment. We will work with the CMS to ensure abuse of our program cannot occur.
The feds can strengthen the system with safeguards, but must avoid unintended devastating consequences for people who depend on charities. The agency has the opportunity to protect an entire class of low-income people with serious illnesses who depend on charitable assistance. Thoughtful action will ensure that people enrolling in the exchanges do so purely because it's the best plan for them—and if they need charitable help to afford the premiums, they can receive it.
It's true that the marketplace needs more healthy people. Thoughtful analysts have proposed measures to strengthen risk pools and make the exchanges more attractive for insurers. Prohibiting charitable assistance, and thereby excluding low-income people with serious chronic conditions, should not be one of those measures.
Some insurers are canceling the policies of charitable grant recipients, while others seek regulatory or legal intervention to foreclose third-party payments. Some insurers are sending threatening letters to people who receive grants. They are trying to leave the most vulnerable among us—those with serious illnesses—behind. It's redlining with another name.
Consider ESRD patients. Three times weekly for four hours, dialysis cleanses their body of toxins—a physically taxing, time-consuming process that leaves most patients unable to work. With diminished income, many cannot afford insurance for the care that keeps them alive. AKF's program has been a safety net for them for two decades.
By law, Medicare-eligible ESRD patients may opt for marketplace plans, so long as they haven't actually enrolled in Medicare. Yet some observers insist these patients should all be on Medicare. But Medicare is not always the best option, and patients deserve the choice. Medicare covers 80% of medical services, so Medigap—which comes with a price tag—is essential. The AKF has long provided grants for Medigap; in fact, most of our grants are for Medicare and Medigap premiums. But in about half the states, insurers don't offer Medigap to people under 65. Some patients select exchange plans for better coverage.
We have proposed guardrails to federal officials to protect both patients and insurance risk pools, while still allowing not-for-profits to help people in need. HHS should require that not-for-profits help people only on the basis of financial need; provide assistance for the full policy year; help people regardless of where they are treated; and offer premium assistance not only for exchange plans, but also for Medicare, Medigap, Medicaid, COBRA, employer group health and other commercial products, so patients have the full choice. HHS should draw from safeguards in its many advisory opinions on not-for-profit premium assistance, and promulgate a regulation that aligns with its longstanding thinking.
Because of the ACA, healthcare is more accessible to chronically ill patients. Insurers should halt their misdirected efforts to deny coverage, and state and federal regulators should give no quarter to actions that could harm patients. As the debate continues, we need to put the health of patients, not the wealth of insurers, first.