The exclusion of measures to stabilize the health insurance marketplace from the omnibus spending package passed last week by the US Congress has revived concerns about sharp premium increases next year in both the individual and group health insurance markets.
A bipartisan plan had been in the works to add such measures to the spending bill, including four years of funding for the cost-sharing reduction (CSR) subsidies prescribed in the Affordable Care Act, billions of dollars in reinsurance funding to help insurance plans cover high-cost patients, and a provision opening up low-cost, catastrophic insurance plans to buyers over 30, Vox health care analyst Sarah Kliff explained last week. Negotiations broke down, however, after Democrats balked at Republicans’ insistence on including these limited-coverage plans in the legislation and reintroducing a ban on providing reinsurance funds to any insurance policy that covers abortion.
As a result, Jeri Clausing reports at Employee Benefit News, benefits experts and employers are now expecting premium hikes of as much as 30 percent in 2019. While the policies in question mainly concern the individual insurance market, the resulting cost issues stand to affect employer-sponsored health coverage as well:
“Destabilization increases uncompensated care, resulting in cost-shifting from healthcare providers to large employer payers,” Ilyse Schuman, senior vice president of health policy for the American Benefits Council, said earlier this month. …
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Although Republican efforts to repeal and replace the Affordable Care Act petered out last year without producing a bill, one of the key provisions of the law—the individual mandate—was effectively gutted in the Tax Cuts and Jobs Act passed by both houses of Congress in December. The tax reform package zeroed out the tax penalty imposed on Americans who fail to maintain continuous health insurance coverage throughout the year, rendering the requirement moot.
The effective repeal of the individual mandate undermines the ACA’s core principle of holding down health insurance costs by expanding the risk pool, raising fears of an upward spiral in premiums as healthy individuals exit the individual insurance market. In the wake of the mandate’s rollback, however, several states are considering imposing their own requirements that residents obtain health insurance, Lisa Nagele-Piazza reports at SHRM:
Massachusetts has already had an individual mandate in effect since 2007. “Massachusetts largely served as the model for the ACA,” explained Jeffrey Herman, an attorney with Greensfelder, Hemker & Gale in St. Louis.
More states may follow suit. Maryland lawmakers recently introduced a bill that would impose penalties on the uninsured in the state. And an individual mandate is also being informally advocated for or considered by state legislators or representatives of insurance exchanges in a number of other states, including California, Connecticut, Minnesota, Rhode Island and Vermont, Herman said.
Adam Solander, an attorney with Epstein Becker & Green in Washington, DC, tells Nagele-Piazza that he expects many states, particularly “blue states” with Democratic legislatures, to explore individual coverage mandates in the coming year.