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Market Stabilization Policies Under Review at Federal Level

March 07, 2018

Leading up to the March 23 deadline to fund the government, federal lawmakers, the Administration, and stakeholders are engaged in negotiations over a stabilization package that would steady health insurance marketplaces.

Federal lawmakers are contemplating including market stabilization policies in a government funding bill later this month.

Efforts have focused on a bipartisan proposal by U.S. Senators Lamar Alexander (R-TN) and Patty Murray (D-WA) that would extend funding for cost sharing reduction (CSR) payments, and legislation by Senators Susan Collins (R-ME) and Bill Nelson (D-FL) to provide $4.5 billion in federal reinsurance funding.

U.S. Congressman Ryan Costello (R, PA-06) has introduced leading legislation in the U.S. House—H.R. 4666, the Premium Relief Act—which would establish a Patient and State Stability Fund.

National organizations representing hospitals, providers, insurers, and employers—the American Hospital Association, Federation of American Hospitals, American Medical Association, American Academy of Family Physicians, America's Health Insurance Plans, American Benefits Council, Blue Cross Blue Shield Association, and U.S. Chamber of Commerce—sent a joint letter urging Congress to include market stabilization legislation in the upcoming government funding package.

Specifically, the letter called for action on two policies:

  • Establishing a premium reduction/reinsurance program to help cover the costs of people with significant health care needs
  • Providing multi-year funding for CSR benefits

As part of stabilization efforts, the Trump Administration has called for Congress to pursue policies that would:

  • Clarify that issuers selling short-term, limited-duration insurance may offer renewals of that coverage to individuals without those individuals going through health underwriting
  • Expand access to health savings accounts by raising contribution limits and allowing HSAs to be integrated with a broader number of plans
  • Modify age-rating requirements to allow older enrollees to be charged up to five times the cost of premiums for younger enrollees

The Administration has asserted the goal of promoting competition and bringing down costs for consumers by providing access to alternative insurance options. Many coverage advocates have raised concerns that healthier consumers will take advantage of less-costly, less-generous coverage, leaving the sicker and higher-cost patients to secure coverage through Affordable Care Act (ACA) plans; ultimately, undermining the ACA insurance marketplaces and consumer protections.

HAP joined 26 Pennsylvania health care provider groups in January in calling on Congress to pursue targeted bipartisan solutions that strengthen and stabilize the individual insurance market nationally and in Pennsylvania. Those groups cited that ‘providing greater certainty within the individual market will help support the health and financial security of hundreds of thousands of Pennsylvanians, and greater economic stability in communities across the commonwealth.”

Please contact Laura Stevens Kent, HAP’s vice president, federal advocacy, or Jeff Bechtel, HAP’s senior vice president, health economics and policy, for more information.

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