House GOP mounts a quiet push for reinsurance and CSRs

In a move that is sparking insurers' hopes, House Republican leaders are quietly pushing a bill that would fund cost-sharing reduction payments and a reinsurance pool.

Rep. Ryan Costello (R-Pa.) of the Energy and Commerce Committee said committee leadership wants to mark up his market stabilization bill—introduced last month—so it can potentially be attached to the omnibus spending package expected in February.

Both Costello and insurance lobbyists close to talks say carriers are thrilled at this first strong signal House Republicans might pass cost-sharing reduction payments and reinsurance.

The stakes on whether CSRs might pass are higher for unsubsidized enrollees in the exchanges and the government than for insurers' bottom lines, as Molina's CEO Joseph Zubretsky pointed out at the J.P. Morgan Healthcare Conference in San Francisco this week.

If CSRs don't come back, Zubretsky said, "it's really not a significant issue for us because all you have to do is know whether you should load it into your pricing or not."

This isn't to say the insurance industry still doesn't hold a keen interest in seeing them pass.

"I'd like to see it because it's better public policy and will save money for the government," Centene CEO Michael Neidorff told Modern Healthcare at the J.P. Morgan Healthcare Conference.

Oscar CEO Mario Schlosser pointed to the spikes in premiums in the 2018 individual market premiums that resulted from CSR defunding and said Washington lawmakers should "have an interest in putting in a stable regulatory regime."

The Costello bill, co-sponsored as of Thursday by the fourth-highest House Republican, Rep. Cathy McMorris Rodgers of Washington, would fund CSRs for 2017, 2019 and 2020.

Funding for 2017 is key because the CMS could potentially collect any overpayments made in 2017 before President Donald Trump abruptly halted the funding of CSRs. Carriers used this money to cover the cost-sharing for their enrollees through the rest of the year, and they have been eying potential litigation if Congress doesn't act to make sure they get the contracted payments.

The reinsurance portion of the bill would appropriate $30 billion over three years for state high-risk pools—another idea insurers are excited about.

Despite the momentum and growing certainty these measures can pass, the politics are sticky. Democrats pointedly walked back their previously insistent calls for CSRs once Republicans eliminated the individual mandate penalty in their tax bill.

House conservatives are recalcitrant in their opposition to what they call a "bailout" for insurance companies—although they are less worried about reinsurance.

While attaching the measure to an omnibus may just push it safely through the political minefield, House GOP leadership would need to walk a tenuous line in trying to bring Democrats on board or appeasing enough of their caucus conservatives to avoid a showdown.

The upper chamber is dealing with its own politics around stabilization as Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) renew talks on the deal they negotiated in September.

Sen. Susan Collins (R-Maine) and Alexander secured a commitment from Senate Majority Leader Mitch McConnell (R-Ky.) to include CSRs and reinsurance in the last spending package of 2017, but as lawmakers barreled toward the budget deadline the two Republicans agreed the measures could wait until 2018.

Sen. Bill Nelson (D-Fla.), who co-sponsored Collins' reinsurance bill, told Modern Healthcare on Thursday that he hopes to hear early next week whether a stabilization package will move in February.

But now Murray wants to assess what the individual market may look like without the mandate with an eye on potentially tweaking the deal.

Murray and Alexander continue negotiations and are hoping to make a February goal, one Senate aide with knowledge of the talks said, "but they are working on their own plan, so it's not a given."

Shelby Livingston contributed to this report.