For 2017, unsubsidized enrollees on the Minnesota individual market faced massive rate hikes averaging 57%. It was so bad that the only way they could convince some carriers to participate in the market was to allow most of them to put a cap on how many people they'd enroll (with the balance being shunted over to Blue Plus, the HMO division of BCBSMN). This resulted in a massive initial surge of enrollment, as it was on a first-come, first-serve basis...but also left off-exchange and unsubsidized exchange enrollees high and dry.
In response, the state scrambled to pull together a $300 million package to help supplement premiums for those folks...knocking a flat 25% off of their premiums for 2017. This helped ease the problem in the short term, but the larger issue still loomed going forward.
It feels almost silly for me to spend so much time crunching the average 2018 rate hike numbers at this point. Between the (supposedly failed?) GOP repeal effort and Donald Trump's ongoing sabotage efforts--including what could be him officially pulling the plug on CSR reimbursements as early as sometime today--it's probably a bit of a futile effort. Besides, a dozen other wonks/analyses have already confirmed what the Kaiser Family Foundation projected months ago and which I've been proving on a state-by-state basis for months now: The CSR threat is causing average rate hikes of around 20 points on average, and the threats to individual mandate enforcement are tacking on another 4-5 points on top of that, beyond the ~10 points which rates would normally be increasing on average.
Roughly 9.1 million of the exchange enrollees receive APTC subsidies; around 6.1 million also receive CSR subsidies.
That leaves roughly 3 million receiving APTC but not CSR and 6.9 million not receiving either (1.6 million on exchange, 5.3 million off exchange)
Based on these ratios, here's a scenario for you:
Let's suppose you run an insurance company currently offering a Bronze, Silver, Gold and Platinum individual market plan both on and off the ACA exchange. You currently (2017) have a total individual market enrollment of exactly 16,000 people, broken out as follows (the on exchange breakout is based on actual OE4 enrollment data; the off exchange breakout is unknown, but Andrew Sprung thinks it's roughly a 40/40/20 Bronze/Silver/Gold split, which sounds about right to me).
Those were Democratic Senate Minority Leader Chuck Schumer's words tonight in response to Republican Senate Majority Leader Mitch McConnell's claims that those on the left were "celebrating" the defeat of his Godawful "Skinny Repeal" bill late Thursday night. And that's a perfect description of how I feel, for several reasons:
1. This wasn't so much a case of an "Actively Positive" thing happening (as was the case with, say, the Obergefell v. Hodges Supreme Court decision) as it was stopping a negative thing (as was the case with the King v. Burwell SCOTUS decision, which actually was announced the very same day as Obergefell). That is to say, it's not that a good piece of legislation passed, it's that a bad piece of legislation was blocked. This isn't to minimize the importance of what just happened tonight (not just in terms of healthcare policy, but also the state of our democratic process, legislative norms and of course the ramifications for the rest of this ongoing nightmare we call the Trump Administration), but it does tend to dampen my emotional response a bit.
2. As I keep stressing: There are real problems with the ACA as it currently stands, and some of them require more than simple "tweaks" as some ACA defenders are prone towards describing them. All of these problems are definitely fixable, but most of those solutions still won't be easy to push through. Furthermore, these issues are exacerbated by two other problems:
3. THE CLOCK IS TICKING for 2018: The final carrier rate filing deadline is rapidly approaching; the carriers need to make their final decisions about how much to charge next year soon...assuming they decide to stick around the individual market next year at all, which isn't a guaranteed thing, especially due to...
4. THE TRUMP SABOTAGE FACTOR will now almost certainly go into overdrive. I'm about 90% certain that Trump will indeed pull the plug on Cost Sharing Reduction reimbursement payments staring next month (August), which could still devastate the indy market almost instantly. Of course, Congressional Republicans could resolve the CSR issue in about 5 minutes with a simple, 87-word bill which would receive unanimous consent from every Democrat in both the House and Senate as long as it was either standalone or not attached to some other poison pill piece of legislation.
For that matter, while the individual mandate repeal died with the "Skinny Repeal" bill failing, House Republicans have also started pushing through a different bill which would prevent the IRS from enforcing the individual mandate anyway, causing the exact same problems. And even if that doesn't happen, HHS Sec. Tom Price could simply start issuing hundreds of thousands of highly-questionable "hardship exemptions" letting pretty much everyone off the hook for the mandate penalty anyway...which, once again, would amount to the same fallout.
(yes, I know she actually says "bumpy night"...I'll update the title this evening if need be...)
OK...here's where things stood as of last night...
UPDATE 7/27/17 12:00pm: OK, here's the latest (at least, as of around noon, anyway):
Apparently, in order to win over a few more votes and squeeze the bill in under the "budget savings" wire, they're now planning on scrapping repeal of the medical device tax and delaying repeal of the employer mandate (but still repealing it eventually). They're also going to throw in defunding Planned Parenthood even though that was previously scrapped by the Senate parlimentarian.
Finally, they're apparently bringing back theEssential Health Benefit State Waiver provision, which would, once again, blow a massive hole in the "Guaranteed Issue and Community Rating" rules.
UPDATE: Hey, who's that up there? Why it's the guy who Republicans wanted to become President just 5 years ago, explaining why, if you're going to guarantee solid health insurance policies to everyone regardless of their medical history and without discriminating on price, you have to include some sort of incentive for them to do so: A carrot and a stick. The tax credits and out of pocket maximums are the carrot. The individual mandate and open enrollment period are the stick.
(sigh) I debated whether to even write a post about the last-minute "Skinny Repeal" plan slapped together by Mitch McConnell yesterday morning for a couple of reasons: First, because even if it passes, the sole purpose of "Skinny Repeal" is to get past the 50-vote Senate threshold...at which point it would be scrapped and replaced with whatever Godawful pile of garbage McConnell comes up with via reconciliation afterwards anyway.
Second, and more to the point, they're supposed to be voting on "Skinny Repeal" within the next few hours, so it's possible that it could be a moot point before anyone even reads this.
OK. Here we go. First, just as a refresher: Here's what the Individual Market was supposed to look like under the Affordable Care Act:
Here's what it actually looks like for a variety of reasons, including both legitimate glitches in the ACA itself as well as a whole lot of flat-out sabotage by the GOP over the past 7 years. While there are plenty of other issues which need to be addressed, the most obvious ones are that the tax credits need to be beefed up and applied to enrollees over the 400% FPL threshold, and the mandate penalty should really be increased. In short, two legs of the stool need to be lengthened...to continue the metaphor, we need a couple of shims. Around $12 billion per year or so should do the trick on the tax credit side. As it happens, one of the few useful parts of most of the GOP plans is that they do include a good $120 billion or so in "reinsurance/stabilization" funding over 10 years...which, in practice, would amount to about the same thing. The key is that this funding would have to be added to the existing ACA funding, not replacing it, which is what these plans do instead:
NOTE: The original focus of this diary was on the deliberate sabotage by the Trump Administration/HHS Dept. under Tom Price of the individual insurance market in general and HealthCare.Gov in particular, but the screen shot mentioned in passing in the diary below is actually far more important and disturbing the more I think about it than I had originally thought.
As noted below, it's an anonymous note sent to me on Thursday. Since it was sent I’ve confirmed the identity of the sender. This doesn’t prove that their specific claim is true, but there’s absolutely no reason I can think of for this person to risk their job and reputation by lying about this issue, and it matches everything else in the diary.
Several professional journalists have since contacted me and I’ve gotten them in touch with the sender. Stay tuned, this could be a big deal.
(sigh) I'm not really sure what the point of even writing about this is since it doesn't include the Cruz-Lee amendment which is supposedly the only thing keeping the ultra-conservative wing of the GOP Senate on board with BCRAP in the first place, but whatever:
CBO and the staff of the Joint Committee on Taxation (JCT) have prepared an estimate of the direct spending and revenue effects of the version of H.R. 1628, the Better Care Reconciliation Act, posted today on the Senate Budget Committee’s website.
By the agencies’ estimates, this legislation would lower the federal budget deficit by reducing spending for Medicaid and subsidies for nongroup health insurance. Those effects would be partially offset by the effects of provisions not directly related to health insurance coverage (mainly reductions in taxes), the repeal of penalties on employers that do not offer insurance and on people who do not purchase insurance, and spending to reduce premiums and for other purposes.
“The idea that you can repeal the Affordable Care Act with a two- or three-year transition period and not create market chaos is a total fantasy,” said Sabrina Corlette, a professor at the Health Policy Institute of Georgetown University. “Insurers need to know the rules of the road in order to develop plans and set premiums.”
But actually, he thought as he re-adjusted the Ministry of Plenty’s figures, it was not even forgery. It was merely the substitution of one piece of nonsense for another. Most of the material that you were dealing with had no connexion with anything in the real world, not even the kind of connexion that is contained in a direct lie. Statistics were just as much a fantasy in their original version as in their rectified version. A great deal of the time you were expected to make them up out of your head.
Thanks to Emily Gee and the Center for American Progress for this:
This isn't a full/official New Jersey rate hike update, as it only refers to one carrier, and rounds things off a bit, but in the video above, if you watch from around 37:30 to 41:00, you'll hear New Jersey Congressman Frank Pallone talk about the negative impact that the CSR reimbursement threat/uncertainty/sabotage effect is having on Horizon Blue Cross Blue Shield...and since Horizon BCBS happens to hold something like 70% of the New Jersey individual market share (which is confirmed by Pallone in the video), the statewide weighted average rate hike will end up being largely determined by theirs.
The most relevant part:
"So Horizon, which is something like 70% of our market in New Jersey, filed like a 24% increase. And I asked the president (of Horizon) "why are you filing with a 24% increase?" I can't imagine that health insurance costs have gone up that much. And he said "Oh, they haven't, Congressman." I said, "well, what is this?"
Health and Human Services Secretary Tom Price on Sunday made a bold and questionable prediction about the Senate GOP bill to repeal and replace Obamacare: He argued that the legislation could actually provide health insurance to more individuals than the Affordable Care Act, a claim undermined by the Congressional Budget Office’s analysis of the bill.
Price made the comment while discussing how the Senate bill closes a gap that existed in certain states that chose not to expand Medicaid under Obamacare. In those states, there is a section of the population that does not qualify for traditional Medicaid, but makes too little to qualify for subsidies on the exchanges since Obamacare intended to cover it through Medicaid expansion. The Senate bill closes this gap, and Price used that provision to argue that more people would be covered under the new legislation.