Category: Implementation

On June 21, 2017, health insurers have to decide whether they will sell coverage on the Obamacare marketplaces. “It will give us the first indication of what the ballpark rate increases are, what counties have insurers and which ones don’t,” says Robert Laszewski, an industry consultant who works with insurers that sell on the marketplace. “Insurers will have to make a statement.” The number of insurers selling on the marketplace fell significantly this year. There are 960 counties on Healthcare.gov that had just one health insurer selling coverage in 2017. That was a big increase from the 180 counties in the same situation in 2016.

Secretary of Health and Human Services Tom Price came into office last month ready to lead the charge on repealing ObamaCare. Now, that effort has run into a brick wall, leaving him to oversee a law he fiercely opposes.

President Trump last week predicted that ObamaCare “soon will explode,” stirring speculation that the administration could seek to undermine the law.

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President Donald Trump and GOP lawmakers, seeking to regroup following the collapse of the effort to repeal the Affordable Care Act, have an option for gutting the health law relatively quickly: They could halt billions in payments insurers get under the law.

House Republicans were already challenging those payments in court as invalid. Their lawsuit to stop the payments, which they call illegal, was suspended as Republicans pushed to replace the ACA, but it could now resume—or the Trump administration could decline to contest it and simply drop the payments. Mr. Trump could unilaterally end the payments regardless of the lawsuit.

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Another insurer sued the U.S. government to recoup unpaid payments under the ACA’s risk-corridor program, but it’s looking less and less likely that the feds will ever pay up.

Sanford Health Plan, the insurance arm of Sioux Falls, S.D.-based Sanford Health, sued the federal government, demanding it pay nearly $9 million in overdue risk-corridor payments for 2014 and 2015. The CMS so far has paid Sanford Health Plan just 15.1% of the amount it owes, according to the complaint filed last week in the U.S. Court of Federal Claims.

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Given by a drop-off in enrollment after President Trump took office, total sign-ups for Obamacare health plans fell this year for the first time, a new report released by the Trump administration Wednesday indicates.

A total of 12.2 million Americans enrolled in a plan through one of the healthcare law’s marketplaces during the 2017 open enrollment period, according to the report, which provides a final tally of this year’s signups.

The 2017 final figure, which updates a preliminary report released last month, was down from 12.7 million in 2016.

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Anthem Inc. and other U.S. health insurers complained to the White House for more than a year that they were losing money on people who waited to sign up for Obamacare coverage until they were sick.

They pleaded with the Obama administration to stem their losses by tightening up on the enrollment rules. When their pleas went unmet, UnitedHealth Group Inc, Humana Inc, and Aetna Inc pulled out of most of the government subsidized health insurance market.

But now that the new Trump administration and Republican lawmakers control the future of healthcare, the industry is getting a new hearing.

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Republicans are getting battered at town halls on ObamaCare, with constituents—or least protestors—yelling about the benefits they’ll lose if the entitlement is repealed. But maybe the better measure of public sentiment is the choices that the people who are subject to ObamaCare have made in practice. Consider the remarkable persistence of health insurance plans that aren’t in compliance with the ACA’s rules and mandates. These “grandfathered” and “grandmothered” plans aren’t obligated to meet ObamaCare’s very high “essential benefits” floor, nor are they required to obey price controls that limit how much premiums can differ based on pre-existing medical conditions. These regulatory differences have thus set up an instructive market test about the need for ObamaCare’s mandates. 8.1 million people chose to remain in their existing plans instead of purchase ACA coverage.
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The United States Court of Federal Claims just ruled that the federal government failed explicitly to appropriate money for an ACA program known as “Risk Corridors” to stabilize the ACA exchanges, and therefore sent the United States an $8 billion bill to make these payments to insurers. It is unlikely that this decision will result in much money actually being sent to insurers or in many insurers returning to the ACA markets. Many of the insurers owed money have already gone out of business. Others have, quite literally, written off any chance of recovering any of this money. Insurers are instead likely to see the money as a bit of a windfall that will not affect business decisions one way or the other as to whether and how to remain in the ACA marketplace.

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Molina Healthcare’s stock tumbled after hours Wednesday after the health insurer posted a fourth-quarter loss that was attributed to parts of Obamacare — a big problem for one of the health insurers that has had success in the program.

However, the company didn’t lose money because it had sicker-than-expected enrollees. In fact, medical costs for its Obamacare enrollees were $120 million lower than Molina thought. Instead, Molina got slammed because it had healthier members and had to pay $325 million into an Obamacare program called risk adjustment, which pools money from insurers in a given state and redistributes it to those who had higher-cost enrollees.

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While Republicans continue to grapple with plans to repeal and replace Obamacare and stabilize health insurance rates, Humana is the first major insurer to say it is dropping out of the individual market for 2018.

“Based on our initial analysis of data associated with the company’s health-care exchange membership following the 2017 open enrollment period, we continue to see further signs of an unbalanced risk pool,” said Humana CEO Bruce Broussard, on a conference call with analysts Tuesday. “Therefore, the company has decided that it cannot continue to offer this coverage for 2018.”

In the wake of the news, President Donald Trump tweeted that the insurer’s decision was another example of the failure of the Affordable Care Act, and he reiterated his plan to “repeal, replace & save healthcare for ALL Americans.”

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