As Republicans in Congress look to repeal and replace the ACA, they’re considering a return to high-risk pools like one in Wisconsin, which some considered a national model. The “Health Insurance Risk-Sharing Plan” — which ran from 1979 to 2014, when the federal health law’s exchanges started — was funded through premiums, insurance company assessments and reduced payments to providers. “Pooling the high-risk individuals together and managing their needs separately was a huge factor in the state’s success in offering a competitive insurance market,” J.P. Wieske, the state’s deputy insurance commissioner, told the House Energy and Commerce Committee this month.
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The new administration should issue two new rules for the 2018 enrollment season:
- It should let online brokers complete enrollments for people who qualify for subsidies. No need to redirect these applicants to HealthCare.gov.
- It should stop imposing user fees to prop up its unnecessary website and finance ad campaigns.
These two changes would set loose an army of insurance carriers, traditional brokers and private online exchanges, all competing to enroll people in subsidized coverage.
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Following an Obama administration order, the IRS had been set to require taxpayers to indicate on line 61 on their form 1040s whether they had maintained health coverage in 2016 or paid the penalty. The IRS would have rejected returns if taxpayers failed to report their coverage status. But the IRS announced this week it would not reject returns that failed to check the appropriate ObamaCare boxes—an early indication of the administration’s efforts to provide relief from ACA mandates.
“This year, the IRS put in place system changes [initiated by the Obama administration] that would reject tax returns during processing in instances where the taxpayer didn’t provide…information [attesting that the taxpayer had health insurance].
“The recent executive order [issued on day one of the Trump administration] directed federal agencies to exercise authority and discretion available to them to reduce potential burden. Consistent with that, the IRS has decided to make changes that would continue to allow electronic and paper returns to be accepted for processing in instances where a taxpayer doesn’t indicate their coverage status.”
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The conceit that the five major commercial health insurers will consolidate to three seems to be dissolving, as four of those insurers called off a pair of mega-mergers on Tuesday. After 18 months of courtship among the Big Five starting in 2015, the outgoing Obama Justice Department’s antitrust division sued to block the $34 billion Aetna- Humana tie-up as well as Anthem’s $48 billion acquisition of Cigna. Federal judges blocked both transactions earlier this year. Anthem had planned to appeal but on Tuesday Cigna pulled the plug after Aetna and Humana did the same.
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A major insurer on Wednesday reported a huge drop in the number of Obamacare customers it has.
Humana reported in its latest fourth quarter 2016 earnings Wednesday that total enrollment in the individual market, which includes Obamacare’s exchanges, declined by 69 percent in January 2017 compared to the month before.
The company said on Dec. 31 it had about 450,800 in the individual market, which includes Obamacare’s marketplaces. However, in January 2017 membership dropped by 69 percent to 204,000.
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As Republicans consider paring back the Affordable Care Act’s federal mandates, they face a difficult question: What does health insurance need to cover?
The 2010 health law created a new set of federal requirements for plans sold to individuals and small businesses, including a list of 10 benefits, among them prescription drugs, mental-health services and laboratory tests. It also mandated that plans cover preventive services such as vaccinations at no cost to enrollees.
The rules, along with other minimum standards set by the law, were meant to ensure that consumers had strong protections and weren’t surprised by unexpected gaps or limits in their coverage. But that also contributed to making individual insurance more expensive in many cases.
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Everywhere you turn, health markets are nearing collapse. It’s an unfortunate and catastrophic reality of too much federal intervention in our health care. From soaring deductibles and skyrocketing premiums to fleeing insurers, it’s no wonder patients are paying more out of pocket each year under the so-called “Affordable Care Act.”
Today, the Energy and Commerce Committee’s Health Subcommittee will examine four legislative solutions to help deliver relief. Together, the bills will play an important role in being among the first bricks placed in the rebuilding of our health care system. Collectively, they will give patients relief from the law’s soaring costs, tighten enrollment gaps, and protect taxpayers.
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Part of why Obamacare is so unpopular is that it is neglects the typical American.
Obamacare is bad for the typical—or median—American for a variety of reasons, including: its unprecedented individual mandate; its inept manner of dealing with preexisting conditions, which has sent premiums soaring (by 40% over the past two years); its roughly $2 trillion price-tag (over a decade); and its consolidation and centralization of power and money at the expense of Americans’ liberty and their wallets. Rather than offering overdue tax breaks to everyone who buys his or her own health insurance, Obamacare instead gives direct subsidies to insurance companies (falsely labeled as “tax credits”) on behalf of the select few.
As Republicans deliberate over an alternative to Obamacare, this provides a huge opening. A more consumer-friendly system will go a long way towards reducing costs for all and bringing down overall health care spending.
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Insurers are generally confident they could manage the transition away from Obamacare and into a new replacement plan, according to a survey from the Urban Institute.
The group interviewed executives at 13 insurance companies participating in the individual market in 28 states to ask them how they would respond in various repeal scenarios proposed by the new administration. While all insurers said that uncertainty regarding the future of Obamacare is bad for business and for the stability of the individual market, they were confident they could manage policy changes. They also expressed optimism about a replacement plan that offered continuous coverage, which many Republican plans include.
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One of the stated aims of the Affordable Care Act was to increase competition among health insurance companies. That goal has not been realized, and by several different measures the ACA’s exchanges offer less competition and choice in 2017 than ever before. Now in the fourth year of operation, the exchanges continue to be far less competitive than the individual health insurance market was before the ACA’s implementation. Moreover, insurer participation in the law’s government-run exchanges has declined over the past two years and is now at the lowest level yet. This lack of insurer participation leaves exchange customers in 70 percent of U.S. counties with no insurer choice, or a choice between merely two insurers.
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