States’ ef­forts weak­ened mar­ket­places

Baltimore Sun - - NATION & WORLD - By Noam N. Levey

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.

JOE RAEDLE/GETTY 2015

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