Higher premiums, fewer choices, less time could confront consumers shopping for insurance, analysts say

Health.com
July 21, 2017

THURSDAY, July 20, 2017 (HealthDay News) -- The Republican Party's quest to undo the Affordable Care Act -- either by replacing it, repealing it or letting it fail -- is creating enormous uncertainty for millions of Americans who buy their own health insurance.

Senate Republicans huddled again Wednesday night to discuss a path forward on health care after several doomed attempts to move bills to overhaul the Affordable Care Act, often called Obamacare.

Aiming to finally resolve the issue, Senate Majority Leader Mitch McConnell (R-Ky.) said he'll force a vote on proposed legislation early next week.

Meanwhile, the nonpartisan Congressional Budget Office estimated Thursday that the latest Republican health care bill would leave an additional 22 million Americans without insurance by 2026.

Also Thursday, Politico reported that the Trump administration has ended two contracts to help people sign up for Obamacare coverage in states where HealthCare.gov -- the federally run insurance marketplace -- operates.

That move comes ahead of the upcoming sign-up period for 2018 coverage.

Depending on how it all shakes out, buyers of Obamacare health plans could face sharply higher premiums and fewer health plan options in 2018, analysts said. In some markets, buyers might be left with only one health plan option, or none at all.

There also will be a shorter window for enrolling in coverage than in previous years. Open enrollment kicks off Nov. 1 and wraps up Dec. 15. Prior-year sign-up periods spilled into the new year.

The big unknown is whether the Trump administration will continue making billions of dollars in "cost-sharing reduction" (CSR) payments to health insurers, said Cori Uccello, a senior health fellow at the American Academy of Actuaries.

These payments, totaling $7 billion in 2016, compensate insurers for offering health plans that feature lower co-pays and deductibles for lower-income Americans.

Health insurers must offer these low-cost-sharing plans to people earning between 100 percent and 250 percent of the federal poverty level. That's roughly $12,000 to $30,000 for an individual and about $24,000 to $60,750 for a family of four, according to The Commonwealth Fund.

The payments were at the center of a lawsuit filed by House Republicans against the Obama administration in 2014. A federal judge ruled in the GOP's favor, but the Obama administration appealed. With the change in administrations, the payments have continued but their fate remains uncertain.

It's up to the Trump administration whether or not to drop the appeal, analysts said.

"At any moment, the administration could pull the rug out from insurers," said Ashley Blackburn, a senior policy analyst with the consumer advocacy group Community Catalyst in Boston.

"It's really causing this extreme uncertainty, which breeds the instability in the marketplaces," she said.

The Kaiser Family Foundation has estimated that insurers would need to raise "silver plan" premiums by 19 percent, on average, to compensate for the loss.

Numerous health plans have stated publicly that they would seriously consider pulling out of the insurance market if those payments disappeared, said Chris Sloan, a senior manager at Avalere Health, a Washington, D.C.-based consulting firm.

It's also unclear whether the Trump administration will enforce the so-called individual mandate. That's the Obamacare provision requiring people to maintain health insurance or pay a fine.

Earlier this year, the Internal Revenue Service indicated that it wouldn't automatically reject tax returns omitting health insurance status. Technically, though, the provision remains intact and undoing it could drive up premiums, too, analysts said.

Right now it's in "wishy-washy territory," Sloan said.

More than ever, it's important for Affordable Care Act consumers to keep up to date on health plan shifts in their local markets, Blackburn said.

More information

Here's more on the Affordable Care Act.

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