Yesterday morning, the President signed an executive order instructing
several federal agencies to consider actions which will further undermine the
ACA.
As I said to the Press Herald yesterday (Trump’s
executive order could alter Maine insurance market) :
“As of the signing of the
executive order, absolutely nothing changes,” said Mitchell Stein, an
independent insurance industry expert. “It only instructs agencies to look at
making changes, but any changes would require standard rule-making, which is a
lengthy process. It’s likely nothing would happen for the 2018 calendar year.”
The wildcard, Stein said, is how
individual insurance companies – most of which are already plagued with
uncertainty – react to another layer of uncertainty.
“There certainly is potential to
undercut the individual market,” he said.
To reiterate, the changes “suggested” have the capacity to
cause a lot of damage, but nothing will happen immediately. Here’s a good
summary from the NY Times: What
Did Trump’s Health Care Executive Order Do?
I went to sleep with those calming thoughts but woke up to
more chaos. Apparently when told the
order would not have an immediate impact, the Administration said, “hold my
beer” and announced that they would cease making the cost-sharing reduction (CSR)
subsidy payments to insurers.
This action has been expected for some time. Many states, including Maine, have accounted
for this possibility in their 2018 rates.
Please keep the following in mind:
1) The payments will still be made to individuals; the
insurers have a legal obligation to provide the subsidies.
2) Here in Maine, the individual plans have built a lack of
subsidy payments into their rate for 2018.
That means the market won't collapse.
3) If you purchase an individual plan, this has implications
for how to make your 2018 choice (remember, open enrollment starts 11/1):
- If you receive a premium subsidy, you are protected - that is because the premium subsidy is based on the benchmark silver plan (whose rates account for the lack of CSR payment)
- If you receive a premium subsidy and a CSR purchase the silver plan just as you would have last year (you must purchase silver to receive the CSR
- If you receive a premium subsidy but no CSR, consider a Bronze or Gold based on your circumstances (your premium subsidy will go further for these plans because they don’t have the CSR surcharge built in)
- If you do not receive a premium subsidy and want to purchase a silver plan, consider purchasing off the marketplace – those plan premiums do not have the CSR surcharge built in
- Bottom line, be an active shopper for 2018
The act of stopping these payments is not only vindictive; it
is foolish. The premium subsidy payments
will go up more than if the CSR subsidy payments were made (The
Effects of Ending the Affordable Care Act’s Cost-Sharing Reduction Payments),
plus the insurers will sue the government for the payments.
You can read more of the gory details in this
excellent post by a health policy attorney: Cutting
off the cost-sharing payments.
The bottom line this morning is more chaos and confusion. None of these actions will reduce costs or
improve benefits, but wasn’t that the goal?
