State insurance commissioners have a message for Congress and the Trump administration: fund the cost-sharing reduction payments so the Affordable Care Act exchanges can be stabilized.
Several members of the National Association of Insurance Commissioners, on Wednesday testified before the Senate Committee on Health, Education, Labor and Pensions, urging Congress to fully fund CSR payments to health insurers and "provide sufficient and sustained stability funding in response to market uncertainty."
"The CSR funding issue is the single most critical issue that you can address to help stabilize insurance markets for 2018 and potentially bring down costs," Julie Mix McPeak, NAIC President-Elect and Tennessee Insurance Commissioner, said in prepared remarks. "And to be clear, this issue is not an 'insurer bailout.' CSR funding ensures that some of our most vulnerable consumers receive assistance for copays and deductibles that are required to be paid under federal law."
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Tennessee has continued to see carriers "flee" the ACA marketplace, largely due to the "tremendous uncertainty" surrounding the 2018 plan year, as well as substantial losses the insurers incurred in recent years, McPeak said. Indeed, Humana and TRH Health Insurance Co. have said they would not write ACA-compliant plans on or off the exchange in 2018.
Moreover, exchange participants in the state will face "substantial" rate hikes, with Blue Cross Blue Shield Tennessee and Cigna filing rate increases averaging 21 percent and 42 percent, respectively, for the 2018 plan year, she said. BCBST reported that 14 percent of its rate increase is due to CSR uncertainty, while Cigna reported the amount at 14.1 percent.
"Should the federal government refuse to find CSRs, premium rates will increase at rates that are otherwise unnecessary based on medical trend, inflation and other cost considerations," McPeak told the Senate Committee members. "On the other hand, should the federal government agree to fund CSRs, and CMS works with the states, we could see proposed increases for 2018 be reduced by substantial margins."
Any reductions in the insurers' rate increases could also result in the federal government paying out less in advanced premium tax credits than it would pay should the rates that insurers have currently filed be approved, she said.
"Please act now to fully fund CSRs and provide that necessary certainty to our insurance markets," McPeak told the senators.
The hearing also included testimony from Oklahoma Insurance Commissioner John D. Doak, Washington State Insurance Commissioner Mike Kreidler, Alaska Insurance Director Lori K. Wing-Heier and former Pennsylvania Insurance Commissioner Teresa Miller.
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Katie Kuehner-Hebert
Katie Kuehner-Hebert is a freelance writer based in Running Springs, Calif. She has more than three decades of journalism experience, with particular expertise in employee benefits and other human resource topics.
