States’ efforts weakened marketplaces
WASHINGTON — As insurers exit Obamacare marketplaces across the country, critics of the Affordable Care Act have redoubled claims that the health law isn’t working.
Yet these same critics, many of them Republican politicians in red states, took steps over the last several years to undermine the 2010 law and fuel the current turmoil in their insurance markets.
Among other things, they blocked expansion of Medicaid coverage for the poor, erected barriers to enrollment and refused to move health plans into the Obamacare marketplaces, a key step to bringing in healthier consumers.
Those decisions left the marketplaces in many red states with poorer, sicker customers than they otherwise might have had.
Now, consumers are paying the price, as insurers seek major rate increases or stop selling plans altogether. Indeed, eight of the nine states where consumer choices Obamacare’s architects included provisions to bring in healthy customers most prized by insurance companies. will be most limited in 2017 have rejected Medicaid expansion and taken other steps that have weakened their marketplaces, data show.
“It’s the same basic lesson I tell my kids,” said Manatt Health managing director Joel Ario, a former insurance commissioner in Oregon and Pennsylvania. “If you put the work into something, you will get results. If you just sit on the sidelines and complain, you shouldn’t be surprised if things don’t work out.”
The marketplaces have been shaken by the closure of more than a dozen new insurance co-ops and moves by major national insurers, including UnitedHealth Group, Humana and Aetna, to scale back offerings in 2017. Many of the insurers that remain in the marketplaces are seeking doubledigit rate increases.
Nearly all cited unsustainable losses due to sicker, costlier customers than the health plans anticipated.
In nearly a third of counties nationwide, just a single insurer will offer plans next year, according to an analysis by the nonprofit Kaiser Family Foundation.
The marketplaces, which provide coverage to about 11 million Americans, were supposed to be more competitive. The law’s architects hoped insurers would be drawn in by the opportunity to sell health plans to millions of Americans. They also included provisions in the law to bring in healthy customers most prized by insurers and included federal subsidies, which help defray most consumers’ monthly premiums. Americans who don’t have coverage are subject to tax penalties.
“The assumption was that states would play an active role,” said Jon Kingsdale, who ran the Massachusetts marketplace.
Some states, including California, Connecticut and Maryland, did. State officials there and elsewhere also worked closely with insurance companies to get them into the markets so consumers would have morechoices.
California and other states that actively supported the law haven’t been immune to the current market turmoil. But even with some market exits, consumers in more than half of California counties can choose from at least three insurers when select- ing health plans next year.
There are many fewer options in states whose leaders have spent years opposing the law.
These include Alabama, Alaska, Florida, Mississippi, Missouri, North Carolina, Oklahoma and Tennessee, all of which will have only one insurer in most counties next year, according to the Kaiser analysis.
Building viable insurance marketplaces in some of these states always figured to be challenging. But many of these states made it even more difficult.
Several are among the more than a dozen that imposed additional regulations on people who were supposed to help consumers enroll in health plans.
Proponents of these regulations argued they were trying to protect consumers. “Our biggest fear, of course, is identity theft,” Florida Attorney Gen. Pam Bondi told Fox News in 2013.
But consumer advocates, patients groups and others saw the rules as a tactic to weaken the law. Missouri’s regulations were so restrictive that they were thrown out by a federal judge, who concluded state leaders were trying to undermine the marketplace.
Insurance regulators in morethanthreedozenstates, facing a backlash from consumers, also refused to move customers with health plans that predated the health law into the marketplaces.
And 19 states are still rejecting federal aid to expand their Medicaid programs to poor, childless adults.
This has been particularly problematic for those states’ marketplaces, research suggests, as many poor — and probably sick — residents who couldn’t get Medicaid have gone into the marketplaces.
Obama administration officials are now working to adjust marketplace rules for 2018 in an effort to bring in more younger, healthier customers.
And last week, Health and Human Services Secretary Sylvia Burwell explained that the new rules should make the marketplaces more attractive for insurers.