Skip to main content
Subscribe
  • Sign Up Free
  • Login
  • Subscribe
  • News
    • Current News
    • Providers
    • Insurance
    • Government
    • Finance
    • Technology
    • Safety & Quality
    • Digital Health
    • Transformation
    • ESG
    • People
    • Regional News
    • Digital Edition (Web Version)
    • Patients
    • Operations
    • Care Delivery
    • Payment
    • Midwest
    • Northeast
    • South
    • West
  • Blogs
    • AI
    • Deals
    • Layoff Tracker
    • HIMSS 2023
  • Opinion
    • Breaking Bias
    • Commentaries
    • Letters
    • From the Editor
  • Events & Awards
    • Awards
    • Conferences
    • Galas
    • Virtual Briefings
    • Webinars
    • Nominate/Eligibility
    • 100 Most Influential People
    • 50 Most Influential Clinical Executives
    • 40 Under 40
    • Best Places to Work in Healthcare
    • Excellence in Governance
    • Health Care Hall of Fame
    • Healthcare Marketing Impact Awards
    • Top Innovators
    • Diversity in Healthcare
      • - Luminaries
      • - Top 25 Diversity Leaders
      • - Leaders to Watch
    • Women in Healthcare
      • - Luminaries
      • - Top 25 Women Leaders
      • - Women to Watch
    • Digital Health Transformation Summit
    • ESG: The Implementation Imperative Summit
    • Leadership Symposium
    • Social Determinants of Health Symposium
    • Women Leaders in Healthcare Conference
    • Best Places to Work Awards Gala
    • Health Care Hall of Fame Gala
    • Top 25 Diversity Leaders Gala
    • Top 25 Women Leaders Gala
    • - Hospital of the Future
    • - Value Based Care
    • - Hospital at Home
    • - Workplace of the Future
    • - AI and Digital Health
    • - Future of Staffing
    • - Hospital of the Future (Fall)
  • Multimedia
    • Podcast - Beyond the Byline
    • Sponsored Podcast - Healthcare Insider
    • Sponsored Video Series - One on One
    • Sponsored Video Series - Checking In with Dan Peres
  • Data & Insights
    • Data & Insights Home
    • Hospital Financials
    • Staffing & Compensation
    • Quality & Safety
    • Mergers & Acquisitions
    • Data Archive
    • Resource Guide: By the Numbers
    • Surveys
    • Data Points
  • Newsletters
  • MORE+
    • Contact Us
    • Advertise
    • Media Kit
    • Jobs
    • People on the Move
    • Reprints & Licensing
MENU
Breadcrumb
  1. Home
  2. Government
April 15, 2017 12:00 AM

Insurers unhappy with White House's ACA marketplace concessions

Virgil Dickson
  • Tweet
  • Share
  • Share
  • Email
  • More
    Reprints Print

    As Congress and Republican leadership continue to wrangle over how to repeal and replace Obamacare, the individual insurance marketplace set up by the 2010 healthcare reform law is a ticking time bomb.

    The Trump administration last week took what insurers call meek steps to try and stop insurers from leaving the Affordable Care Act exchanges and the off-exchange market en masse. Insurers have been warning for months that they must know whether the government will keep paying billions in cost-sharing subsidies before they submit premium rates for next year.

    Instead HHS dropped a final rule that limits how many people can get coverage outside of open-enrollment periods and lets insurers potentially pay a lower percentage of consumers' medical costs. It also allows insurers to refuse coverage to anyone who owes money for unpaid premiums.

    But the biggest concern-long-term continuation of cost-sharing subsidies-was mentioned only in passing in the rule. In what appeared to be subtle deference to what continues to be law of the land, the rule has a nonbinding provision stating that the cost-sharing subsidies will continue and even increase in 2018. Rulemaking requires agencies to follow current law.

    The Takeaway

    As the deadline for setting next year's premium rates looms, insurers are losing patience and hope the Trump administration will do enough to stabilize the individual insurance marketplace.

    A number of major healthcare and business groups, including the U.S. Chamber of Commerce, urged Trump in a letter last week to continue the cost-sharing reduction payments. The letter warned that without the subsidies, consumers, providers, insurers and employers will suffer.

    An estimated 20 million Americans buy insurance in the individual market, and many of them could lose access to affordable plans if the cost-sharing reduction payments aren't continued and insurers either raise rates or exit the market, experts say.

    A federal district judge in a lawsuit brought by House Republicans found the federal payments for the cost-sharing reductions unconstitutional. Trump could drop the Obama administration's appeal of the ruling and halt the payments. He warned last week that he might do that if Democrats don't negotiate with him on repealing and replacing the ACA.

    Some 7 million people receive the subsidies, or 58% of those who signed up for Obamacare coverage for 2017. The payments are expected to cost $7 billion this year.

    "There is still too much instability and uncertainty in this market," Marilyn Tavenner, president of America's Health Insurance Plans, said in a written statement after the HHS market stabilization rule was released. "Health plans and the consumers they serve need to know that funding for cost-sharing reduction subsidies will continue uninterrupted." AHIP is among the organizations that signed the letter to Trump.

    The final rule reduces how much insurers pay for plan members' medical costs in the average silver plan. Right now, silver plans must cover at least 68% of costs, with the rest coming out of consumers' pockets. The rule cuts that percentage to 66%, which could lower premiums but increase out-of-pocket costs by as much as $1,000 a year.

    To offset these costs, the administration suggested increasing by $200 million to $400 million the cost-sharing subsidies provided to enrollees in 2018.

    That move shows "an inconsistency between the rule and what Trump is saying," said Topher Spiro, vice president for health policy at the liberal Center for American Progress.

    Tim Jost, an emeritus law professor at Washington and Lee University, said the rule's reference to additional cost sharing subsidies does not bind the CMS to actually make the increased payments to insurers.

    The appeal of the House Republicans' lawsuit, House v. Price, is on hold until May 22. It's not clear what the Trump administration intends to do. Congressional Republicans could appropriate the money for the cost-sharing reductions, but conservatives are likely to reject any action to shore up the ACA markets. The Trump administration is reportedly divided on the next steps to take.

    The HHS final rule included other changes that concern the insurance industry. It shortened the 2018 enrollment period from three months to six weeks, from Nov. 1 to Dec. 15.

    Kaiser Permanente said in a comment posted on March 6 that the shorter enrollment period would lower sales, which could lead to higher premiums. Experts say there's a risk it will hurt enrollment among highly coveted younger, healthier consumers, who often sign up at the last minute.​

    Letter
    to the
    Editor

    Send us a letter

    Have an opinion about this story? Click here to submit a Letter to the Editor, and we may publish it in print.

    Recommended for You
    congress prescription drugs
    PBMs, Big Pharma face off in House hearing
    Biden COVID copy_i_i.jpg
    Biden administration asks employers to help more workers who lose Medicaid
    Most Popular
    1
    Centene to lay off 2,000 workers
    2
    How health systems are battling price-gouging allegations
    3
    Senate advances bill to temporarily aid hospitals, health centers
    4
    Elevance, Blue Cross Louisiana halt $2.5B proposed deal
    5
    Tower Health to sell urgent care centers, close others
    Sponsored Content
    Modern Healthcare Alert: Sign up for this breaking news email to be kept in the loop as urgent healthcare business news unfolds.
    Get Newsletters

    Sign up for enewsletters and alerts to receive breaking news and in-depth coverage of healthcare events and trends, as they happen, right to your inbox.

    Subscribe Today
    MH Magazine Cover

    MH magazine offers content that sheds light on healthcare leaders’ complex choices and touch points—from strategy, governance, leadership development and finance to operations, clinical care, and marketing.

    Subscribe
    Connect with Us
    • LinkedIn
    • Twitter
    • Facebook
    • RSS

    Our Mission

    Modern Healthcare empowers industry leaders to succeed by providing unbiased reporting of the news, insights, analysis and data.

    Contact Us

    (877) 812-1581

    Email us

     

    Resources
    • Contact Us
    • Help Center
    • Advertise with Us
    • Ad Choices
    • Sitemap
    Editorial Dept
    • Submission Guidelines
    • Code of Ethics
    • Awards
    • About Us
    Legal
    • Terms and Conditions
    • Privacy Policy
    • Privacy Request
    Modern Healthcare
    Copyright © 1996-2023. Crain Communications, Inc. All Rights Reserved.
    • News
      • Current News
      • Providers
      • Insurance
      • Government
      • Finance
      • Technology
      • Safety & Quality
      • Digital Health
      • Transformation
        • Patients
        • Operations
        • Care Delivery
        • Payment
      • ESG
      • People
      • Regional News
        • Midwest
        • Northeast
        • South
        • West
      • Digital Edition (Web Version)
    • Blogs
      • AI
      • Deals
      • Layoff Tracker
      • HIMSS 2023
    • Opinion
      • Breaking Bias
      • Commentaries
      • Letters
      • From the Editor
    • Events & Awards
      • Awards
        • Nominate/Eligibility
        • 100 Most Influential People
        • 50 Most Influential Clinical Executives
        • 40 Under 40
        • Best Places to Work in Healthcare
        • Excellence in Governance
        • Health Care Hall of Fame
        • Healthcare Marketing Impact Awards
        • Top Innovators
        • Diversity in Healthcare
          • - Luminaries
          • - Top 25 Diversity Leaders
          • - Leaders to Watch
        • Women in Healthcare
          • - Luminaries
          • - Top 25 Women Leaders
          • - Women to Watch
      • Conferences
        • Digital Health Transformation Summit
        • ESG: The Implementation Imperative Summit
        • Leadership Symposium
        • Social Determinants of Health Symposium
        • Women Leaders in Healthcare Conference
      • Galas
        • Best Places to Work Awards Gala
        • Health Care Hall of Fame Gala
        • Top 25 Diversity Leaders Gala
        • Top 25 Women Leaders Gala
      • Virtual Briefings
        • - Hospital of the Future
        • - Value Based Care
        • - Hospital at Home
        • - Workplace of the Future
        • - AI and Digital Health
        • - Future of Staffing
        • - Hospital of the Future (Fall)
      • Webinars
    • Multimedia
      • Podcast - Beyond the Byline
      • Sponsored Podcast - Healthcare Insider
      • Sponsored Video Series - One on One
      • Sponsored Video Series - Checking In with Dan Peres
    • Data & Insights
      • Data & Insights Home
      • Hospital Financials
      • Staffing & Compensation
      • Quality & Safety
      • Mergers & Acquisitions
      • Data Archive
      • Resource Guide: By the Numbers
      • Surveys
      • Data Points
    • Newsletters
    • MORE+
      • Contact Us
      • Advertise
      • Media Kit
      • Jobs
      • People on the Move
      • Reprints & Licensing