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Bipartisan Efforts to Address Insurance Market Stability Begin to Take Shape

August 03, 2017

In the wake of the U.S. Senate’s failure to pass legislation to repeal and replace the Affordable Care Act (ACA), bipartisan efforts focusing on market stability are underway through the U.S. Senate Health, Education, Labor and Pensions (HELP) Committee and the U.S. House bipartisan “Problem Solvers Caucus.”  

Six members of the Pennsylvania Congressional delegation—Ryan Costello (R, PA-06), Charlie Dent (R, PA-15), Brian Fitzpatrick (R, PA-08), Pat Meehan (R, PA-07), Lloyd Smucker (R, PA-16), and GT Thompson (R, PA-05)—are members of the Problem Solvers Caucus and will continue to play a critical role as Congress pursues legislation addressing the ACA.

Senate HELP Committee Chairman Lamar Alexander (R, TN) and Ranking Member Patty Murray (D, WA) announced the committee will hold a series of hearings, beginning the first week of September, in an effort to "stabilize and strengthen" the individual health insurance markets. Chairman Alexander has indicated the committee will look to stabilize the marketplaces for 2018, and consider longer-term work to address the competitiveness of the individual insurance market.

The hearings will provide an opportunity for the Senate to hear from health policy experts and stakeholders, including state insurance commissioners, governors, insurance companies, and consumers.

While the HELP Committee works toward stabilization, Chairman Alexander has urged President Trump to continue to pay cost-sharing reduction (CSR) payments that help lower copays and deductibles for low-income Americans who earn 100 to 250 percent of the federal poverty level. If the CSRs are not maintained, it is widely expected that premiums will increase, and insurance companies may be forced to pull out of the markets.

The Trump Administration has continued payments to date, and a Federal Appeals Court ruling may help preserve the payments.

In the House, a group of more than 40 bipartisan lawmakers—the Problem Solvers Caucus—have outlined a specific proposal to “stabilize health insurance markets and provide relief to individuals, families, and small businesses.”

The Problem Solvers Caucus proposal would:

  • Bring CSR payments under the Congressional oversight and appropriations process, while also ensuring mandatory funding for those payments
  • Create a dedicated stability fund that states can use to reduce premiums and limit losses for providing coverage, particularly for those with pre-existing conditions
  • Adjust the employer mandate by raising the threshold on the requirement for employers to provide insurance under the employer mandate to businesses of 500 employees or more, and revising the definition of “full-time” to indicate that a full-time work week is at least 40 hours
  • Repeal the 2.3 percent excise tax on medical devices
  • Provide technical changes and clear guidelines to sections 1332 and 1333 of the ACA for states that want to innovate on the exchange or enter into regional compacts to improve coverage and create more options for consumers

The caucus offered potential funding sources to fully pay for the proposals, including:

  • Reducing Medicare payment for bad debt
  • Creating a bundled payment system for post-acute care in Medicare
  • Recapturing premium tax credit overpayments
  • Encouraging the use of generics in Medicare Part D
  • Expediting brand drug discounts in Part D as seniors approach the coverage gap known as the “donut hole”
  • Accelerating competitive bidding in Medicare Advantage

Congressional leadership is still under pressure to pursue avenues to repeal the ACA but recognition is building that attention must be paid to immediate market stabilization efforts.

HAP continues to prioritize ensuring that Pennsylvania’s consumers maintain access to health coverage, and is working with key Pennsylvania lawmakers to that end. Contact Laura Stevens Kent, vice president, federal advocacy, or Jeff Bechtel, senior vice president, health economics and policy, for more information. 

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