The Trump administration issued a proposal that it said will stabilize Obamacare's health insurance markets on Wednesday, tightening when people can sign up for coverage and giving health insurers more flexibility.
The U.S. Department of Health and Human Services proposed a new regulation even as President Donald Trump seeks to repeal the law. In the meantime, the health department lead by his new secretary, Tom Price, is trying to placate health insurers that are considering dropping out of the program's government-run markets, threatening to leave people without options in a growing number of states.
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The rule would cut in half the time when people can sign up for coverage under the Affordable Care Act, to about a month and a half. It would also curtail so-called special enrollment periods that allow people to sign up for coverage outside the regular window. Insurers have said that those sort of exceptions let people game the system, and only sign up after they get sick.
"This proposal will take steps to stabilize the Marketplace, provide more flexibility to states and insurers, and give patients access to more coverage options," said Patrick Conway, Acting Administrator of the Centers for Medicare & Medicaid Services. "They will help protect Americans enrolled in the individual and small group health insurance markets while future reforms are being debated."
GOP conundrum
Obamacare presents a conundrum for Republicans, who control the White House and both chambers of Congress. They campaigned on repealing the Affordable Care Act, but now find themselves responsible for managing it as they debate how, or if, they should replace it. At town halls held in their home districts, some Republican lawmakers faced questions and protests from citizens demanding to know their plan.
Meanwhile insurers have been pulling out of the government-run exchanges in an increasing number of states. The latest announcement came Tuesday from Humana Inc., which plans to quit Obamacare entirely for next year.
Humana's decision leaves 70,000 Tennesseans forced with finding new health coverage for next year, including 40,000 residents in Knoxville without no option on the exchange at all, according to Senate health committee Chairman Lamar Alexander, a Republican from the state. Alexander renewed his call to move forward on a rescue plan to help Americans "trapped in the failing Obamacare exchanges" before they run out of options.
Facing blowback from their constituents, Republican moderates have said they want to see a replacement policy before voting for repeal. More conservative members want to move ahead before they lose momentum.
'Stabilize markets'
Another provision in the Trump administration rule is targeted at people who enroll in Obamacare coverage, then stop paying. In those cases, health insurers could apply new payments from a customer to past debts on those unpaid premiums. The administration said such a rule was "important as a means of encouraging individuals to maintain continuous coverage throughout the year and prevent gaming." Another regulation would give health insurers more flexibility to change the value of the coverage they provide, in order to keep up-front premiums stable from year-to-year.
"These changes help protect taxpayers and stabilize markets," Representative Greg Walden, the Oregon Republican who leads the House Energy and Commerce Committee, said in a statement with Representative Michael Burgess, a Texas Republican.
Health insurer Aetna Inc. Chief Executive Officer Mark Bertolini, who's been saying for months that the ACA's markets were deteriorating and causing losses, called the proposed regulation "good initial steps." His company, which already retreated from some markets for this year, is considering whether to reduce its presence further.
"It is in a death spiral," Bertolini said in a video interview with the Wall Street Journal that aired Wednesday on the newspaper's website.
Anthem Inc. and the Blue Cross Blue Shield Association, a lobbying organization that represents a large group of health insurers, also welcomed the Trump administration rule.
"These proposals would help stabilize the current individual market and are a good start toward improving the functioning of the marketplace, so that any longer-term reforms can begin on a better footing," said Alissa Fox, the BCBS Association's senior vice president of policy and representation.
Premium increases
The regulation issued Wednesday is a proposed rule, meaning that the Department of Health and Human Services will get feedback on the measure before finalizing it. Many of the provisions won't go into effect until 2018, and could be moot if Republicans have replaced the law, or parts of it, with something else by then.
Related: 10 worst states for ACA premiums
In the meantime, the rules are meant prevent a repeat of this year, when premiums climbed about 25 percent on average and some insurers quit markets, limiting options for consumers.
The goal "is to give insurers and their actuaries a better sense of how to price their plans and thus avoid the massive premiums increases we've seen," Ed Haislmaier, who worked on the ACA on Trump's transition team and has long studied the health law at The Heritage Foundation, said in an interview before the proposal was released.
Trump has said he's committed to repealing the law. One of Trump's first acts in office was to sign an executive order declaring he'll seek a "prompt repeal" of the health law, and ordering his agencies to minimize its burdens.
Lawmakers have also proposed legislative changes designed to make the ACA profitable for insurers. They include widening the difference between what insurers can charge older and younger customers and tightening the rules for buying coverage outside the normal enrollment period.
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