What’s behind the Department of Health and Human Services’ suggested Obamacare rule changes?
By Dwyer Gunn
Yesterday, the Department of Health and Human Services proposed a number of new rules for the Affordable Care Act’s non-group health insurance exchanges. Here are the big changes HHS put forward:
- Shortening the open enrollment period. Under the new rules, open enrollment for 2018 would begin on November 1st, 2017, and run through December 15th, 2017 (it’s currently scheduled to run through January 31st, 2018).
- Beefing up the pre-enrollment verification requirements for people who enroll outside the standard enrollment window (due to qualifying events like job loss, the birth of a child, etc.).
- Allowing insurance companies to collect past-due premium payments from individuals before enrolling them in the subsequent year’s plan.
- Reducing the actuarial value of plans offered on the exchanges (which will also reduce the value of the premium subsidies families receive).
- Allowing states to determine whether insurance plans provide access to a sufficiently broad network of care providers.
These changes are all designed to stabilize the individual health insurance markets, which have been jittery in the face of Republican promises to repeal the Affordable Care Act. The first three proposals are aimed at improving the quality of the risk pool, an issue that has plagued the individual marketplaces, by making it more difficult for people to “game” the system, or wait to sign up for health insurance coverage until they’re sick.
The last two points are designed to increase profits for insurance companies, which will hopefully incentivize insurers to stick around in 2018. The HHS proposal predicts that the fourth tweak—reducing the actuarial value of exchange plans—“could reduce the value of coverage for consumers, which could lead to more consumers facing increases in out-of-pocket expenses, thus increasing their exposure to financial risks associated with high medical costs.” The proposal also goes on to suggest that, “in the longer run, providing issuers with additional flexibility could help stabilize premiums, increase issuer participation and ultimately provide some offsetting benefit to consumers.”
A few of these ideas actually mirror changes that the Obama administration suggested last year, but Democrats and consumer advocates have largely come out against the rules. Senator Ron Wyden, a Democrat from Oregon, told the New York Times that the rules send “a clear message to the American people: Patients are not a priority, and insurance companies are back in charge.”
It’s also not clear these proposals will keep insurers from fleeing in 2018 if the GOP introduces an ACA replacement plan that eliminates premium subsidies or the individual mandate. As Caroline Pearson, senior vice president at Avalere Health, told the Associated Press, “I don’t necessarily think these changes are enough to alter insurers’ decision-making about staying in the markets.”
The rules are open to public comment until March 7th, and will likely by finalized and issued by April.