The federal government doesn’t have to pay insurers billions of dollars under an Affordable Care Act program aimed at enticing them into the markets by helping cover their financial risks, a divided federal appeals court ruled Thursday.
In a case brought by Moda Health Plan Inc., the ruling is a blow to insurers hoping to recoup money they say they were owed under the 2010 health law.
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Federal officials will not block insurance companies from again using a workaround to cushion a steep rise in health premiums caused by President Donald Trump’s cancellation of a program established under the Affordable Care Act, Health and Human Services Secretary Alex Azar announced Wednesday.
The technique — called “silver loading” because it pushed price increases onto the silver-level plans in the ACA marketplaces — was used by many states for 2018 policies. But federal officials had hinted they might bar the practice next year.
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People with ACA plans drop their plans at a much higher rate than in the pre-Obamacare era. The average monthly attrition rate under Obamacare in 2015 (3.6%) was nearly two-thirds higher than the average monthly attrition rate in the non-group market in 2006 (2.2%). This occurred even though 86% of Obamacare enrollees were receiving subsidized coverage. We can only imagine what would have happened had enrollees borne the full cost of their premiums (as was the case in 2006). The reality is that while the non-group market was never perfect, it performed much more smoothly before the ACA than most critics ever gave it credit.
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New data from insurance company regulatory filings show that enrollment in the individual health insurance market declined significantly last year—by 10 percent, or 1.8 million people.
Over the three years prior to the implementation of Obamacare (2011 through 2013), enrollment in the individual market was basically stable—fluctuating narrowly between 11.8 million and 12 million persons. With the introduction of Obamacare, enrollment jumped to 16.5 million in 2014, peaked at 17.7 million in 2015, and then declined to 17.1 million in 2016.
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After years of losses, the U.S. health insurance industry figured out how make money from Obamacare last year, a new analysis shows.
The secret? Raising their prices.
The average cost of health insurance plans sold in the individual market climbed about 22 percent in 2017, as insurers boosted premiums well above what they spent on medical care. That left many in a profitable position for the first time since the Affordable Care Act went into effect, according to a Kaiser Family Foundation report released Thursday.
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Short-term health insurance is sometimes scoffed at as “sham insurance.” But to those who turn to it in need, this kind of insurance offers vital protection from unexpected medical costs. The Trump administration’s plan to extend how long it lasts makes sense.
Short-term plans offer temporary coverage for many of the same things standard health plans do. They don’t, however, cover things like preventive care, maternity care, or pre-existing medical conditions. Short-term plans do not meet the coverage requirements of the Affordable Care Act (ACA), but they have long offered a meaningful measure of protection to people who need to fill a gap in health insurance coverage.
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Here’s what the Department of Health and Human Services could do:
- Relax rules so companies of all sizes can take advantage of HRAs. Medium-sized and large employers want the same option of setting up HRAs for workers to buy ACA coverage, said Chris Condeluci, who worked on the ACA as a Senate GOP staff attorney.
- Now that the individual mandate has been repealed, the administration could open the door for companies “to provide funds to buy noncompliant coverage,” said Gary Claxton, a vice president at the Kaiser Family Foundation.
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The Trump administration moved on Tuesday to deliver affordable health care to millions of Americans with a proposed rule that would expand the availability of short-term, limited duration plans to one year.
The rule comes as a result of the president’s executive order calling on federal agencies to take the necessary measures to scale back Obamacare’s burdensome regulations.
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Obama Care survived a GOP repeal attempt but the law’s prognosis remains poor—higher premiums and insurer flight. Some Republicans would be happy to dump money into the exchanges and move on, so credit the Trump Administration for a proposal that puts consumer choice ahead of politics.
On Tuesday the Health and Human Services Department proposed a rule for short-term, limited duration health insurance as an alternative to the ObamaCare exchanges. Insurers would have to make clear that the plans, which could last for less than 12 months, would be liberated from the Affordable Care Act’s benefit and other mandates.
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Medicare Accountable Care Organizations (ACOs) were created by the Affordable Care Act (ACA) to improve the efficiency of the networks of hospitals and doctors that deliver services to Medicare patients and thereby lower the government’s costs. So far, however, ACOs haven’t produced any savings for the federal government. ACOs would become more efficient and innovative if they were forced to compete with the other options beneficiaries have for getting their Medicare-covered benefits.
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