Word From Washington: Latest Affordable Care Act Developments

The past week has seen a flurry of news on the ACA front. We’ve summarized some of the latest developments for you here.

• On July 10, the US Centers for Medicare and Medicaid announced it will further reduce funding for navigators. Navigators are individuals or organizations that are trained to help Americans buy insurance in the ACA exchanges. The latest cuts, coming on top of funding reductions in 2017, mean that the federal government will have slashed its support for the navigator program by 90 percent.
• CMS also announced that navigators will be encouraged to direct customers toward the cheaper, non-ACA compliant plans (short-term and association health plans) that the Administration has been promoting over the past year. These skimpier plans don’t have to meet important ACA consumer protection standards. They may, for example: omit coverage for some essential health benefits (e.g., prescription drugs); put dollar caps on benefits; not cap patient out-of-pocket obligations; and/or deny coverage or charge higher premiums to people with pre-existing conditions. Patient groups, provider associations, and health policy analysts are concerned that promoting the wider use of non-ACA compliant plans will lead to customer confusion, underinsurance, destabilized markets for comprehensive insurance, and more.

You can read the CMS notice here. HFA is joining with other patient groups to oppose this CMS action.

• On July 7, CMS announced that it would suspend “risk adjustment” payments owed to certain health insurers under the ACA for 2017-18. The risk adjustment program redistributes funds from insurers with a healthier and cheaper customer base to insurers who ended up covering sicker and costlier enrollees. These transfers (amounting to $10.4 billion for 2017) are intended to stabilize insurance markets and reduce incentives for insurers to cherry-pick healthy customers. AHIP, the insurance trade association, criticized the CMS decision. AHIP said the government’s suspension of risk adjustment payments will create market uncertainty, increase premiums, and reduce coverage options. The decision hits especially hard since it was announced just as insurers are deciding whether to participate in the ACA exchanges for 2019 and what rates to charge. You can read more about CMS’s suspension of risk adjustment payments here. HFA joined with other patient groups in urging CMS to reconsider its suspension of risk adjustment payments. You can read the press release here.
• Litigants who are challenging the constitutionality of the ACA (see Word from Washington update of June 11, 2018) filed a new brief on July 5. The plaintiffs continue to ask the court to invalidate the ACA in its entirety. In their latest brief, however, the plaintiffs ask that if the court grants the more limited injunction requested by the US Department of Justice – throwing out “only” the ACA’s pre-existing condition protections, along with the individual mandate – then that ruling should apply only in the plaintiffs’ states. Incredible as it may seem, 20 state attorneys general are asking the court to strip patient protections from consumers in their own states. You can read more about the latest court filing here. HFA will continue to update you about this litigation.