Stephanie Armour at the Wall Street Journal reports on the increasing willingness of Republicans to think about reinsurance:
Republicans opposed to the Affordable Care Act are showing interest in proposals to shore up the health law and lower premiums, driven partly by their concerns that any big jump in insurance costs may hurt them in the midterm elections.
State and federal GOP lawmakers are backing or considering reinsurance proposals that aim to curb premiums by offsetting insurers’ costlier claims….
Timing is important. Insurers are developing their preliminary rates right now. They submit those preliminary rates for state approval in mid-spring. Insurers then sign their final contracts with the Center for Medicare and Medicaid Services (CMS) in late September. The public use files that show actual pricing tends to be released between seven and ten days before open enrollment starts. Open Enrollment starts November 1, 2018. Midterm elections are November 6.
Republicans as the party defending more seats and holding the White House will get blame or credit for the general environment. They have a strong incentive to avoid headlines that say “Your insurance is going up 20% again”.
Right now here are the major factors of pricing changes with rough estimates of the size of the increase:
- General medical trend +7
- Repeal of the individual mandate +10
- More association and underwritten individual plans +2 to +5
- Repeal of the Health Insurance Tax -3
We’re looking at a baseline of a seventeen to twenty point increase in individual market, non-subsidized premiums. Premiums will drop as people downshift from Gold to Silver or Silver to Bronze as well as shop around if they are able to do so. But this is a good rough baseline.
A reinsurance program funded at $15 billion dollars in initial federal outlays reduces the increase to probably five to eight percent on average. That is a much better headline.
I think there is a policy deal that can be made that trades a Democratic policy win for Republican political wins. A deal that funds reinsurance, modifies 1332 guidance, shifts outreach from Healthcare.gov to states and makes Catastrophic plans funny looking Bronze plans could easily pass. Cost Sharing Reduction subsidies will not be restored to their 1/19/17 status quo. If CSR is funded, it will be in exchange for richer premium tax credits and higher phase-outs of both premium and CSR subsidies.
MomSense
My experience and that of my kid and my friends is that the subsidized premium increases were off the charts this year. We are all paying paying twice as much this year for bronze plans than the cost sharing silver plans we had last year. This includes our co-op Community Health Options.
dr. bloor
As an unsubsidized buyer, I’m ready to eat a 20% increase for a year or two if it means getting the House back. Any deal the D’s cut that even marginally increases the R’s chances of holding onto the House had better look Pretty Fucking Good. Like Ryan’s-Testicles-In-A-Jar-On-Nancy’s-Mantle good.
gvg
How uneven are the price increases? What I mean is, are the big increases in red areas or blue? The republicans especially Trump have been pretty blatant about wanting to hurt blue areas. It needs to be hurting their home turfs for us to get any relief.
? ?? Goku (aka Baka Amerikahito) ? ?
@dr. bloor:
Could Dems actually block it if they wanted to? Would the Crazy Caucus in the House vote no to a new CSR even if it meant potentially saving themselves this November?
Would blocking a CSR look bad for the Dems ahead of the mid-terms? Most importantly would lowering rate increases actually work to save R House seats?
Butch
So not because it’s the right thing to do but because they’re worried about votes. That’s heartening.
It’s a little personal; the company where I work got bought a while back and the new owners are absolutely miserable. The only thing that’s keeping me there now is the cost of private health insurance.
David Anderson
@gvg: There is some interesting research that argues Republican leaning areas have worse risk pools because local elite validation has encouraged healthier people to get out of the market which means higher premiums in GOP leaning counties.
James E. Powell
Democrats should not trade policy wins for political wins. That was the number one problem with the Obama administration, especially the first term. And look how that all worked out. Unless and until the Democrats focus as much on winning and only winning as the Republicans do, they will always be trading themselves and their supporters for crumbs and band-aids.
2liberal
healthcare related but OT for this thread: David what are your thoughts on the goings-on in Idaho with the state scofflaw approach to the ACA ?
David Anderson
@2liberal: tomorrow
Tldr crazy bananapants