Nazis and white supremacists. Charlottesville. Immigration policy and DACA. Climate change. In the context of these issues, there’s been much discussion of late about moral and ethical principles and American values.
There is, of course, no moral equivalency between white supremacists and those who oppose and protest them. People who advocate white supremacy are just plain wrong, on moral grounds.
And the Trump administration is clearly pursuing a path on immigration policy and climate change that is contrary to the ethical standards and values of the vast majority of Americans. I would add to this list the expansion of health insurance coverage. If anything is clear after this summer’s failed attempt by Republicans to repeal the ACA it’s that almost all Americans now support universal coverage.
And, more to the point, people see this increasingly in moral terms. They get it. It took many years—decades—to get to this point. But this summer’s debate clarified what our values are as a nation on access to health care via the structure of insurance, private and public.
So, thank you Republicans for triggering the debate. It was painful but illuminating. Your plans to go backwards on our nation’s slow but steady expansion of coverage failed. In the end, 70 to 80 percent of adults—including tens of million of Republican voters—rejected your plans to upend the ACA completely, and thereby erode the coverage expansions at its core. We can only hope that’s an end to such efforts. But it appears that some Republicans in Congress are still not fully getting the message. They are choosing to ignore their own voters and the moral issue at hand, and to pursue a partisan path that is grounded in bad policy and a willful denial of basic insurance principles and the benefits of the ACA to date—imperfect as it is.
I speak of the renewed debate in the Senate last week, and continuing this week, around fixes to the ACA ahead of this fall’s open enrollment. There is dissonance once again in Republican ranks that could disrupt, delay or scuttle entirely an emerging bipartisan effort to stabilize the ACA marketplaces, which cover 10 million people.
The effort is being led by Lamar Alexander (R-Tenn) and Patty Murray (D-Wash), chair and ranking member, respectively, of the Senate Health, Education, Labor and Pensions (HELP) Committee. They have buy-in on the Committee, in principle, towards a deal to fund the payments insurers get under Obamacare—called cost sharing reduction, or CSR, payments. These payments (about $8 billion in total this year) compensate insurers for lowering/subsidizing deductibles and co-payments for low-income exchange enrollees. About 75 percent of exchange enrollees benefit from CSR relief. (Deductibles in the exchanges are higher than employer-based coverage, averaging above $2,000 for individual coverage and $3,500 for family coverage.)
Importantly, without CSR payments, premiums will increase by larger amounts. Insurers have been very clear about this and in testimony before the HELP committee last week, insurance commissioners from 4 states all but begged for continued CSR payments to keep a lid on premium hikes of 20, 30 or even 40 percent for 2018 (on top of an average 22 percent nationwide in 2017).
In addition, the Committee is considering creating a reinsurance program to help insurers pay for high-cost care. Such a program operated for three years (2014-15-16) as a provision of the ACA but expired in 2017. Reinsurance also helps constrain premium increases.
A deal could also include a Republican goal: easing the path for states to apply for waivers from the federal government to experiment with health insurance expansions, as well as more flexibility for states to bend ACA rules. Murray and other Democrats have said they are willing to consider more state flexibility as long as it does not undermine coverage.
Hard right Republicans, however, are beginning to make disruptive noises, as they so often do. Leading the charge is Orrin Hatch, chairman of the Senate Finance Committee. In an op-ed in the Washington Post on Friday Sept. 8, Hatch called reinsurance and the CSR payments “insurer bailouts” and said he could not support them.
This is an example of willful ignorance. Not only is reinsurance a tried-and-true insurance mechanism, used across the industry, but it’s a tool frequently used in health insurance. Employers who self-fund their employee health benefits buy it. And the federal government back-stops the Medicare Part D plans with reinsurance for high expense claims. In addition, the federal government subsidies the Medicare Advantage program in a way that’s analogous to the CSR payments—not to mention the fact that the government subsidies employer-based health insurance to the tune of almost $300 billion a year in deferred taxes.
Hatch has also signaled that he would not attach any ACA fix measures to the reauthorization of the Children’s Health Insurance Program (CHIP), a must-pass piece of legislation by the end of this month.
Along with Hatch, Senate leader Mitch McConnell could derail the bipartisan train on ACA fixes—possibly out of spite.
And then there’s Trump and HHS Secretary Price. Trump has played politics with the CSR payments for months, threatening to stop paying them as leverage to get Democrats to the bargaining table on an ACA replacement. In fact, Trump last week agreed to a path preferred by Democrats on the debt ceiling, and signaled he may work with them on other legislation.
But that could change at any moment, of course; the Trump administration revealed antipathy to the ACA and mercurial, ever-shifting, chaotic modus operandi again last week when it further reduced funding for the navigator programs that assist people in enrolling in the exchanges. And, in a series of tweets, he piled on his previous criticism of McConnell and Paul Ryan for their failure to pass an ACA repeal & replace bill.
Indeed, whether Trump would agree to sign a bill with any form of ACA fix attached is unknown. He has not yet tipped his hand on that. And it’s very likely one reason Hatch doesn’t want to attach any ACA fix to the CHIP bill is that Trump would have a hard time vetoing that.
All of this is a on a very tight schedule if its to be relevant to premiums for 2018. HHS and state insurance commissioners must lock in exchange premiums by the end of this month—or at the latest the first week of October—to prepare for the start of open enrollment on Nov. 1.
It’s time for Republicans to realize that their attempt to undo the ACA was and remains quixotic. More importantly, their clumsy efforts were morally bankrupt and out of step with progress towards the goal of universal coverage that’s now firmly embraced by the public.
