Gary S
Gary S's JournalCenter for American Progress says Republican risk pools short by $200 Billion
An analysis done by the Center for American Progress found that the high-risk pools in the GOP bill are underfunded by at least $200 billion over 10 years, even with $130 billion included in their planning. Their plan for covering pre-existing conditions is doomed to failure. If you or someone you know has a pre-existing condition, you've got to help stop this horrible Republican plan.
Source:
House Health Care Plan Is Not Enough to Keep High-Risk Pools Afloat
https://www.americanprogress.org/issues/healthcare/news/2017/05/02/431698/house-health-care-plan-not-enough-keep-high-risk-pools-afloat/
The Republicans would not fund the ACA Risk Pools for $3 billion, so now they need $130 Billion
The Affordable Care Act included a premium stabilization provision ("risk corridors" 1) that was designed to help cap insurance companies' risk in this uncertain environment. If claims paid by an insurer exceed a certain level, the provision would kick in and the insurance company would get help covering its loss. When insurance companies submitted their bills under the Affordable Care Act’s risk corridor provision, the Republican controlled congress funded only $362 million of the $2.87 billion requested by insurers in 2014 2.
This single act of betrayal by the Republican controlled House (whereby the risk coverage that had been assured when they set their premiums was not paid) made it inevitable that ACA rates would rise, and that some insurers would withdraw their plans. Insurers had to increase their rates to cover the risk that the ACA said Congress would cover.
Republican betrayal continued in 2015 and 2106, such that the limited risk pool funds available in 2015 and 2016 were still being used to pay off 2014 obligations, and the U.S. Department of Health and Human Services notified insurers that they should anticipate no payments for the 2015 risk corridors 3.
So, Republicans paid only a portion of the risk payments in 2014, and none in later years. They told insurance companies to stop expecting payments in 2015 and 2016.
Fast forward to 2017. A lot more Republicans now understand the risk associated with health insurance benefits (especially existing conditions and no lifetime maximums), and now they are set to provide $130 Billion to cover their own risk pool over the next 10 years. 4
People don’t seem to know that the Affordable Care Act actually had the risk corridor mechanism (still does), and that had the Republican controlled House funded what the law called for, we would most certainly have had lower premiums and more choices under the Affordable Care Act in 2015 and beyond.
The Republican controlled House caused the ACA rate increases, and the withdrawal of insurers, by their refusal to make the ACA Risk Corridor payments. They didn't care about the people, or the insurance companies. All they wanted was for "Obamacare" to fail.
1 Public Law 111-148 Patient Protection and Affordable Care Act, Section 1342 . Establishment of risk corridors for plans in individual and small group markets"
2 www.law360.com “ACA Risk Corridor Funding Falls Short, Litigation Ensues”, Law360, New York (June 9, 2016, 10:57 AM EDT)
3 Health and Human Services Memo “Risk Corridor Payments for 2015”, September 9, 2016. https://www.cms.gov/CCIIO/Programs-and-Initiatives/Premium-Stabilization-Programs/Downloads/Risk-Corridors-for-2015-FINAL.PDF
4 www.cnn.com “Here's a list of what you need to know about health care", Phil Mattingly Profile
By Phil Mattingly, CNN May 1, 2017
The Affordable Care Act is still at risk if Trump or the House move to stop CSR Payments...
The Affordable Care Act uses "Cost Sharing Reduction" payments to help make certain policies more affordable. A detailed explanation of the payments is here...
http://obamacarefacts.com/insurance-exchange/cost-sharing-reduction-subsidies-csr/
Simply put, Cost Sharing Reduction Subsidies lower the amount people have to pay out-of-pocket for deductibles, coinsurance, and copayments. To benefit, enrollees must participate in a Qualified Health Plan, and have enrolled through the Marketplace. These payments are absolutely essential to help keep the cost of plans down.
About 6 million enrollees (including 28,000 Native Americans) currently benefit from these subsidies. 1
What's the status of CSR payments? In November 2014, House Republicans filed suit to block CSR payments. A ruling was made against the payments, but the judge allowed the payments to continue pending appeal. In November, 2016, the House Republicans filed a motion to delay their own lawsuit while they try to figure out their alternative healthcare plan. 2
If the Trump administration and the House Republicans decide to pursue this lawsuit and stop CSR payments, the impact on the Affordable Care Act (and its enrollees) would be devastating. Under the Affordable Care Act, insurers would have to continue to provide the subsidies, and if not reimbursed would result in additional costs to them of about $7 billion this year and $130 billion over the next ten years. 2
Marilyn Tavenner, president of America’s Health Insurance Plans, predicts just that if the Trump administration doesn't provide greater assurances of future subsidies: “I think we would lose more insurance companies...and insurers would hike prices by perhaps 20 percent."3
So there we have it... the next way that our President and the Republicans can cripple our health care system.
1 http://www.tribalselfgov.org/wp-content/uploads/2017/01/TSGAC-Status-of-CSR-Payments-2017-1-6a.pdf
2 http://healthaffairs.org/blog/2016/05/12/judge-blocks-reimbursement-of-insurers-for-aca-cost-sharing-reduction-payments
3 https://www.washingtonpost.com/national/health-science/health-insurers-warn-of-wider-defections-from-aca-marketplaces-for-2018/2017/02/01/c507ec78-e807-11e6-bf6f-301b6b443624_story.html?utm_term=.1877761feb85
President Trump took another step to cripple the ACA on January 20...
President Trump took another step to cripple the Affordable Care Act on January 20 when he issued an order to halt $5 million in advertising, and outreach activities in the final days of the 2017 enrollment period. 1 The Washington Post reported that staffers at Health and Human Services protested because history had shown the advertising was necessary to prompt younger, healthier people to enroll, with the final deadline traditionally having been the second biggest enrollment day of the cycle. 2 Last year, nearly 700,000 people selected plans a week before the final deadline. 3
Former HealthCare.gov CEO Kevin Counihan predicted that the move could depress enrollments of the most needed customers by several hundred thousand. "It's counterproductive...To be frank, I think it's fairly transparent...I think the intention is to suppress enrollment...This has a material impact on enrollment." 4
Ben Wakana, a former senior spokesman at HSS, had this to say...“It’s outrageous. It’s irresponsible... They are deliberately undermining open enrollment to try to get a lower enrollment number.” 1
It simply amazes me that our President would take this step to sabotage the American healthcare system. Of course he is entitled to dislike the Affordable Care Act and want to replace it. But to purposely take steps that will reduce enrollment of the youngest, healthiest people that are needed to balance the overall risk pool is shameful. It is inevitable that this single action will help raise premiums in 2018, and help push insurers to withdraw plans in 2018 and beyond.
In fact... Marilyn Tavenner, president of America’s Health Insurance Plans, predicts just that if the Trump administration doesn't provide greater assurances of future subsidies: “I think we would lose more insurance companies...and insurers would hike prices by perhaps 20 percent." 5
Whether they like it or not, the Trump administration and his fellow Republicans now own the responsibility for our healthcare system, and steps that decrease enrollment and cripple the current plans prove they care more about politics than building a viable system of care.
1 https://www.bloomberg.com/news/articles/2017-01-27/trump-administration-pulls-some-obamacare-ads-as-deadline-nears
2 https://www.washingtonpost.com/national/health-science/white-house-stops-ads-outreach-for-last-days-of-aca-enrollment/2017/01/26/a2f92682-e420-11e6-ba11-63c4b4fb5a63_story.html?postshare=2881485490750551&tid=ss_tw-bottom&utm_term=.a7962deeec5d
3 http://money.cnn.com/2017/01/27/news/economy/obamacare-ads-trump/
4 http://www.cnbc.com/2017/01/27/ex-healthcaregov-ceo-trump-killed-obamacare-ads-to-suppress-enrollment.html
5 https://www.washingtonpost.com/national/health-science/health-insurers-warn-of-wider-defections-from-aca-marketplaces-for-2018/2017/02/01/c507ec78-e807-11e6-bf6f-301b6b443624_story.html?utm_term=.1877761feb85
The Republicans only had to do 1 thing to cripple the Affordable Care Act, and they did it...
Much is being said about the increasing premiums and the reduction in choices under the Affordable Care Act. By far the greatest cause of these problems was the betrayal of the insurance companies by the U.S. House of Representatives.
Providing health insurance for a large group of individuals without having had prior experience with that group is very risky, especially when preexisting conditions are allowed and lifetime maximums are removed. The Affordable Care Act included a premium stabilization provision ("risk corridors" 1) that was designed to help cap insurance companies' risk in this uncertain environment. If claims paid by an insurer exceed a certain level, the provision would kick in and the insurance company would get help covering its loss. This provision was/is so important that House Speaker Paul Ryan's “A Better Way Healthcare Initiative” replacement plan includes "risk pools" to protect insurers 2, and he's willing to put aside $25 billion over 10 years to fund it 2,3. Secretary of Health and Human Services Tom Price’s plan provides $3 billion for similar risk pools over 3 years.4
So it would seem everyone is in agreement that some type of risk pool or risk cap is necessary to help insurers deal with the unpredictable nature of individual health insurance policies.
What happened? Why did premiums go up? Why did insurers pull out? When insurance companies submitted their bills under the Affordable Care Act’s risk corridor provision, the Republican controlled congress funded only $362 million (or 12.6 percent) of the $2.87 billion requested by insurers in 2014 5. This single act of betrayal by the House (whereby the risk coverage that had been assured when they set their premiums was not paid) made it inevitable that rates would rise and that some insurers would withdraw their plans. Insurers had to increase their rates to cover the risk that the ACA said Congress would cover.
Congressional betrayal continued in 2015 and 2106, such that the limited funds available in 2015 and 2016 were still being used to pay off 2014 obligations, and the U.S. Department of Health and Human Services notified insurers that they should anticipate no payments for the 2015 risk corridors 6.
The U.S. House of Representatives betrayed ALL of us when they knowingly withheld risk corridor payments necessary for the Affordable Care Act to work. They knew that their action would raise premiums, and reduce choice. I write this in the sincere hope that Republicans and Democrats will work together to make our healthcare system work.
SOURCES
1 Public Law 111-148 Patient Protection and Affordable Care Act, Section 1342 . Establishment of risk corridors for plans in individual and small group markets"
2 www.politico.com Concerns rise in New York over Republican proposal for high-risk pools, Dan Goldberg, 01/18/17 05:28 AM EST, and http://www.forbes.com/sites/realspin/2017/01/28/will-paul-ryans-obamacare-replacement-work-for-people-with-pre-existing-conditions/#7282c650c3a6
3 abetterway.speaker.gov “High Risk Pools”, Page 21
4 www.healthmarkets.com “Tom Price’s Healthcare Proposal: 7 Changes You Need to Know About” Item 2, “Provide Funding for Risk Pools”
5 www.law360.com “ACA Risk Corridor Funding Falls Short, Litigation Ensues”, Law360, New York (June 9, 2016, 10:57 AM EDT)
6 Health and Human Services Memo “Risk Corridor Payments for 2015”, September 9, 2016. https://www.cms.gov/CCIIO/Programs-and-Initiatives/Premium-Stabilization-Programs/Downloads/Risk-Corridors-for-2015-FINAL.PDF
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