Bipartisan Health Care Bill Could Prevent Further Increases to Insurance Rates
This week, the Maryland Insurance Administration approved additional increases to premiums for the health insurance plans offered through Maryland’s individual marketplace. CareFirst and Kaiser Permanente, the remaining health insurance providers participating in the market, were given the go ahead in August to raise rates for 2018, but the insurance companies requested additional increases due to concerns over their abilities to cover costs following the Trump administration’s decision to end payments of cost-sharing reduction (CSR) subsidies.
About 56 percent of Marylanders who are enrolled in ACA health insurance plans benefit from lower out-of-pocket expenses. Low- and moderate-income people, with incomes less than about $60,000 for a family of four, are eligible for these lower costs. Insurers use CSR payments to offset the costs of providing lower co-pays and other fees to these families. In order to keep out-of-pocket expenses in line with ACA standards in the absence of those payments, insurers have to increase premiums. The Maryland Insurance Administration has a legal obligation to ensure that premiums remain affordable but while still allowing insurers to cover costs.
A bipartisan proposal from Sens. Lamar Alexander and Patty Murray could stabilize individual insurance marketplaces and avoid further increases to premiums. The bill, which two dozen Republican and Democratic senators have co-sponsored, would:
- Establish funding for CSR subsidies for the next two years
- Make changes to waiver rules to give states additional flexibility while still upholding essential health benefits and protections for preexisting conditions
- Restore funding for individual marketplace outreach and enrollment
- Expand access to catastrophic coverage plans to individuals over 30, regardless of income level
- Authorize funding for state reinsurance programs
There are some concerns with the bill. Most importantly for Marylanders, the agreement doesn’t provide a permanent appropriation for CSR payments. The two-year appropriation it does include is only a short-term fix for the instability that President Trump’s decision to rescind payments has created. Long-term assurance that CSR payments will continue would help insurers keep their rates stable and continue operating in the individual insurance market.
After wasting so much of the year debating harmful repeal and replace efforts, Congress needs to act quickly to pass the Alexander-Murray legislation in order to have a substantial effect on premiums and market stability in 2018, as open enrollment begins within a week. However, even if it is not enacted in time to have much of an effect this year, it would still have a positive impact in 2019 and open the door to further negotiations to make adjustments to the ACA on a bipartisan basis.
Access to affordable health care is one of the building blocks that keeps our communities thriving. The Alexander-Murray agreement is an important first step in stabilizing the individual insurance market and preventing additional, unaffordable increases to premium costs. Policymakers should continue to work together to strengthen the Affordable Care Act and ensure that health insurance coverage is in reach for all Marylanders.
