The U.S. Senate Committee on Health, Education, Labor and Pensions hearings on the Affordable Care Act could lead to bipartisan legislation for Congressional approval to continue cost-sharing reduction (CSR) payments to insurance companies providing health insurance policies on government healthcare exchanges. That bipartisan support could extend greater flexibility to states in developing solutions to their healthcare challenges.
Senator Patty Murray (D-Wash.), the Ranking Member of the committee, said she believed there is enough bipartisan support to pass legislation approving continuation of the CSRs and more flexibility for states. “I am very confident there is room for common ground right here in the coming days that makes it easier for states to innovate in ways that make healthcare work better for patients and I am looking forward to continued discussion on that,” she said. “I feel optimistic that there is much more we agree on than disagree.”
Senator Lamar Alexander (R-Tenn.), the committee chair, said, “To get a result, Republicans will have to agree to something that many don’t want to agree to, additional funding through the Affordable Care Act, and Democrats will have to agree to something that some are reluctant to agree to and that’s more flexibility for states. That’s called a compromise.”
We should know this week if this new spirit of bipartisanship will lead to meaningful legislation. Sen. Alexander has said the committee’s goal is to try to reach consensus this week on an agreement that Congress can pass by the end of September. New insurance rates for 2018 are to be posted on the government’s website, healthcare.gov, by Sept. 27.
As the same time, that spirit of bipartisanship being fostered by the committee may be challenged by some Republican senators. Politico is reporting that Senate Majority Leader Mitch McConnell (R-Ky.) and his leadership team are seriously considering a vote on a bill written by Senators Lindsey Graham (R-S.C.) and Bill Cassidy (R-La.). That bill would replace the ACA’s tax subsidies with block grants for states, end the law’s individual insurance mandate, and scale back Medicaid expansion. Sen. McConnell is expected to make a decision this week on whether to bring the bill to a vote.
It was clear from testimony from governors, state insurance commissioners, health experts and insurance company officials that there was bipartisan support for continuing CSRs through at least 2019. The CSRs act as a buffer to cover losses insurers might encounter by providing lower cost plans on the exchange that offer lower deductibles, co-pays and co-insurance costs. Many health insurance agencies like UnitedHealth, Anthem and Aetna have withdrawn from some exchanges, unwilling to accept the risk associated with offering plans with no CSR approvals in place, ultimately leading to bare minimum options for counties in some states. While some agencies have managed to find some success in these markets exited by these insurance giants, there are still many counties in states across the nation who may enter 2018 with only one option in their exchanges. CSRs may encourage insurers to either stay or reenter exchanges, knowing that some of the costs may be covered through subsidies, thereby stabilizing the exchange market.
President Trump, at one point, threatened to eliminate CSR payments because a federal judge has ruled that the payments, authorized by the Obama administration, are illegal because they were not approved by Congress. However, the Congressional Budget Office (CBO) says eliminating the CSRs could increase the federal deficit by $194 billion from 2017 through 2026. The CBO reasons that insurers in some states would withdraw from the individual insurance market because of substantial uncertainty over the CSR payments. Participating insurers would be expected to raise premiums to cover their costs because individuals on the market would be required to bear the costs without any CSR payments from the government to bridge the gap. This increase in premiums would lead to more increased subsidies being paid to individuals who meet eligibility requirements under the ACA.
“Without cost sharing reductions, as pointed out by many senators, the Congressional Budget Office, The Joint Committee on Taxation and our witnesses, premiums will increase an additional 20% in 2018,” said Sen. Alexander. “So premiums go up 20%, the federal debt goes up $194 billion over 10 years to pay for the higher premiums, and 5% of the people will be leaving in bare counties after just one year.”
However, Sen. Alexander says support for CSRS will have to be accompanied by support for making it easier for states to receive a Section 1332 waiver that provides them the flexibility to pursue innovative strategies while retaining the basic protections of the ACA. This also was a topic championed by many of the witnesses at the hearings. State Innovation Waivers can be provided to states to implement innovative solutions that meet the following three protections: (1) is at least as comprehensive and affordable as would be provided absent the waiver, (2) provides coverage to a comparable number of residents of the state as would be provided coverage absent a waiver, and (3) does not increase the federal deficit. Recommendations provided to the committee included reducing the six-month review period and allowing faster review of waivers requested by states that follow similar programs being undertaken in other states.
“I simply can’t go to the Republican majority in the Senate, the Republican majority in the House and to the Republican President to extend the cost sharing payments without giving states more meaningful flexibility,” said Sen. Alexander.
“People across the country are looking to Congress for solutions on healthcare,” said Sen. Murray. “It’s a deeply personal issue and one that has been far too partisan and divisive for too long.”
“I am really pleased that we have had productive bipartisan conversations over the last two weeks.”
Will that spirit of bipartisanship ultimately hold sway over the U.S. Senate? Stay tuned!
