CBO Report: The Effects of Terminating Payments for Cost-Sharing Reductions

The Congressional Budget Office released its analysis of the impact that eliminating the Cost-Sharing Reduction subsidies, which provide federal support for low and middle-income consumers to purchase health insurance through the exchanges, would have on the marketplace.

In short:

  • Premiums for Silver health plans would rise an estimated 20% in 2018 and 25% by 2020. Insurance plans would need to raise their premiums to offset the lost funding.
  • Federal deficits would increase by $6 billion in 2018, $21 billion in 2020, and $26 billion in 2026, for an overall increase in the federal deficit of $194 billion.

  • Initially, some carriers would exit the market, or choose not to enter. This would leave about 5% of people in areas of the country in which insurers would not participate in the exchange market in 2018, but insurers would participate in nearly all areas by 2020. 

Tim Jost, at Health Affairs, takes a look at the impact terminating the CSRs would have on the federal deficit and examines some potential problem areas in the CBO analysis and methodology., and The Center for Budget Policy and Priorities claims, "Severe Harm If Trump Halts Health Cost-Sharing Payments."

In Maryland, carriers have already submitted rate requests for 2018 which are among the highest in the nation at 50% or more. We expect more news on the rates for 2018 to be announced later next week. Stay tuned!

Shoring Up the ACA Marketplaces

With the President on vacation and Congress in recess, shoring up the ACA marketplaces is becoming a game of chicken between insurers and the Trump Administration. 

Drew Altman of the Kaiser Family Foundation puts the ACA stability "crisis" in perspective by looking at how many people will be affected by the rising premiums. Kaiser also released a report this week which found that mixed signals from President Trump have created uncertainty "far outside the norm" and led insurers to seek higher premium increases for 2018 than would otherwise have been the case.

Meanwhile, Politico reported last week that Maryland Insurance Commissioner, Al Redmer, Jr., is considering allowing insurers to file revised rates, assuming the cost-sharing subsidies disappear. Our state is already facing some of the highest premium spikes in the country, with CareFirst seeking to raise rates by more than 50%. Just yesterday, CMS announced that it would extend the filing deadline for health insurance carriers by 3 weeks to Sept. 5th. This will give insurers uncertain about the future of the marketplaces more time to make decisions about pricing their plans and may calm the markets.

The Health Insurance Tax (HIT) returns in 2018 and will result in higher premiums, totaling $22 billion for more than 100 million Americans - impacting those who receive insurance through Medicare Advantage and Part D or their employer. Congress still has time to act to prevent the return of this tax

And finally, last Wednesday, a bipartisan coalition of health policy leaders called on Congress to strengthen the existing healthcare law with a 5-point proposal to help Americans gain access and stay covered.

What Needs to Be Fixed in Obamacare?

Consumer Health First Executive Director, Jeananne Sciabarra, weighs in, along with other national experts on what it may take to fix Obamacare in the short run. 

“If insurers know their coverage of expensive patients is backed up, then they can keep rates lower for all,” added Jeananne Sciabarra, executive director of Consumer Health First.

Sciabarra suggested the maximum income to qualify for subsidies be raised so more consumers could participate.

“Middle-income people are really getting squeezed out,” she said.

Click here to read the whole article.

Maryland must take steps to protect health consumers

In a Letter to the Editor in today's Baltimore Sun, Consumer Health First Executive Director, Jeananne Sciabarra writes:

"It’s encouraging to see members of Congress launch bipartisan efforts to bolster the Affordable Care Act and shore up the individual health insurance markets (“GOP shows signs of reaching out to Democrats on health care,” Aug. 1). Congress should work with the Trump administration to ensure that the individual mandate is enforced and that the federal government makes critically important cost-sharing payments that make coverage affordable for many Americans.

We received good news recently with a court ruling that allows Maryland, under the leadership of Attorney General Brian E. Frosh, and other states to intervene in the lawsuit over these payments. Maryland needs to act quickly to protect health care consumers from rising prices and declining competition. We again urge Insurance Commissioner Al Redmer to reject the outrageously high rate increases sought by CareFirst and those filed in response by Kaiser Permanente. Such increases will further destabilize the market by pushing out younger and healthier consumers.

There are hopeful signs around the country of insurance rates stabilizing and insurers moving in to serve people in areas that had few or no insurers for 2018, thanks to state leaders taking an active role in making their markets function well. We know that our state leaders will likewise do all they can to ensure a strong market and affordable rates for Maryland’s consumers."

This Is What Democracy Looks Like

As we rub the sleep out of our eyes this morning, we can hardly believe what transpired overnight. When the 3rd ACA repeal bill of the week - the "skinny repeal" - was brought up for a vote at 1:40 a.m., three Republican Senators joined all 48 Democrats in opposing it. In his speech after the vote, Majority Leader McConnell said he wanted to hear Democrats' ideas for improving the health care system - let's hope he meant it.

But the real credit for this victory goes to YOU! With your calls, letters, and emails, by sharing your stories and attending rallies, protests and Town Halls all over Maryland and the nation, YOU DID IT.

It can't be said enough. THANK YOU. We are grateful to you for your support, participation, advocacy, and passion. And we are extremely grateful to our leaders in Congress: Senators Chris Van Hollen and Ben Cardin, and the Representatives who stood with us with passion and determination as we fought this attack on our nation's healthcare system: Steny Hoyer, Anthony Brown, Elijah Cummings, Jamie Raskin, John Delaney, John Sarbanes and Dutch Ruppersberger. We are also grateful to Governor Larry Hogan for joining with other governors to speak out against repeal. 

We're going to enjoy our weekend, and hope that you do, too - you earned it! But while we have won this battle, we have not won the war. President Trump immediately took to Twitter to remind us that he has the power to "Let Obamacare implode... Watch!"

So we'll be back at it on Monday with renewed purpose, as we seek a bipartisan environment of cooperation and compromise to reach a common goal: healthcare for all.