WASHINGTON – The collapse of the latest Republican attempts to bury the Affordable Care Act has turned attention to whether President Donald Trump’s administration will shore up the nation’s health care system he wants to get rid of.
The president has levers he can pull to either help sustain the law known as Obamacare or undermine it, health care experts said.
They said among steps he could take to stabilize the current health system are:
• Continue funding subsidy payments to insurance companies.
• Enforce the mandate that most Americans have health care.
• Promote enrollment in the annual sign-up period that begins in November.
Insurers say that without those assurances, premiums will skyrocket next year, and more companies will stop selling subsidized insurance in state exchanges.
“All eyes in the insurance industry will now be on what Trump administration officials say and tweet,” said Larry Levitt, senior vice president at the Kaiser Family Foundation.
In Pennsylvania, for instance, Insurance Commissioner Teresa Miller said she fears insurers will raise rates by 25 percent or more if the administration doesn’t sustain Obamacare’s subsidies and coverage mandates.
There’s reason to doubt Trump will do so, given his tweet after the GOP Senate plan to revamp the law lost Friday on a razor-thin vote of 49-51: “3 Republicans and 48 Democrats let the American people down. As I said from the beginning, let ObamaCare implode, then deal. Watch!”
“That’s exactly what I’m afraid of,” Miller said in an interview.
She said failure of the Senate to do nothing occurred at a critical time for insurance companies that must finalize rates for next year by Aug. 16. Unless the current law is stabilized, she added, insurers will hedge their bets by building uncertainty into their pricing.
Insurance companies and their industry groups have been struggling under Obamacare, in part because their costs have risen sharply from fewer than expected enrollment by individuals despite the federal mandates.
The American Health Insurance Plans, an industry group, wrote to the federal Centers for Medicare and Medicaid Services two weeks ago asking for a commitment to enforce the insurance coverage requirement.
Not enforcing it, they said, would result in more younger and healthier people dropping their coverage, forcing insurance costs to those who rely on the system, including the lower-income sick and disabled, through the roof.
The insurance group also asked for a commitment to continue paying federal subsidies to insurers to lower copayments and deductibles. Without the subsidies, it said, people will drop their insurance due to the higher out-of-pocket expenses.
Congressional failure to repeal or revamp Obamacare means individuals are still required to buy insurance or pay a fine. Republicans, including Trump, oppose the idea of the government mandate, causing health care experts to worry the president will simply not enforce it.
Earlier this year, the Internal Revenue Service took a step in that direction, saying it will no longer subject people to fines for not having insurance if they indicate such on their tax returns.
Miller said the five insurance companies selling subsidized insurance in Pennsylvania requested an 8.8 percent rate increase next year. But she also said they estimated they would ask for much higher rates if they believe the administration won’t strictly enforce Obamacare’s requirements.
Cynthia Cox is a Kaiser insurance expert who has been tracking proposed rates around the country. She said insurers in Virginia and New Mexico built in increases of up to 20 percent, assuming lax enforcement of the law. She added they could roll back the rates if the administration quickly pledges to enforce it.
Steep rate increases would only mean more pain for those who’ve had to pay rapidly-rising premiums under Obamacare because younger, healthier people have not offset the cost of coverage to sicker and older individuals in need of medical care.
More than 12 million lower-income people who make no more than four times the national poverty rate — or about $80,000 for a family of three – now receive federal subsidies to help pay for their insurance.
They are insulated from rate increases under the law’s provision that says they pay no more than 10 percent of their income on premiums. The subsidies cover the difference.
But another 10 million middle-income Americans not covered by that provision have been hit with double-digit increases and could see their rates shoot up even higher unless the health care system is stabilized.
Miller said Pennsylvania insurers estimate their rates will climb on average 23 percent if they are not guaranteed payment of the federal subsidies.
The same is true in other states. Blue Cross and Blue Shield of Georgia, for example, is seeking a 40 percent increase next year – and that’s based on the assumption cost-sharing subsidies continue, said spokeswoman Debbie Diamond. The company hasn’t said how high the increase could be without the subsidy.
The Trump administration hasn’t said if it will continue the federal subsidy payments to insurers. Nino Fetalva, assistant White House press secretary, said in an email, “We are still considering our options.
Sen. Bob Casey, D-Pa., Friday pressed the administration to enforce the insurance coverage mandates and fund the subsidies. He said in a statement the Trump administration “has a basic obligation to make sure our health care system works well and I will hold them accountable for doing just that.”
Republican Sen. Lamar Alexander of Tennessee plans to hold hearings on short-term fixes to rising premiums, enrollment and other Obamacare issues. He is the chairman of the Senate Health, Education, Labor and Pensions Committee.
The Senate’s failure to pass the GOP health care bill, said Alexander, “leaves an urgent problem that I am committed to addressing.”
No date has been set for the hearings. And the prospects for bipartisan agreement are uncertain, with Democrats and Republicans deeply divided over the ways and means of fixing the health care system that accounts for nearly one-sixth of the nation’s economy.