Trump threats to in­sur­ers may boost pre­mi­ums

Pittsburgh Post-Gazette - - Health & science - By Alan Fram

WASH­ING­TON — Aver­age pre­mi­ums for in­di­vid­u­ally pur­chased health in­sur­ance will grow around 15 per­cent next year, largely be­cause of mar­ket­place ner­vous­ness over whether Pres­i­dent Don­ald Trump will block fed­eral sub­si­dies to in­sur­ers, Congress’ non­par­ti­san fis­cal an­a­lyst pro­jected Thurs­day.

The Con­gres­sional Bud­get Of­fice es­ti­mate comes as Trump has re­peat­edly threat­ened to halt the pay­ments in his drive to dis­mem­ber Pres­i­dent Barack Obama’s health care law.

The agency said 2018 pre­mi­ums will grow “largely be­cause of short-term mar­ket un­cer­tainty — in par­tic­u­lar, in­sur­ers’ un­cer­tainty about whether fed­eral fund­ing for cer­tain sub­si­dies that are cur­rently avail­able will con­tinue to be pro­vided.”

It also at­trib­uted the pro­jected in­crease to grow­ing num­bers of peo­ple liv­ing in re­gions where only one in­surer sells poli­cies, there­fore fac­ing less com­pe­ti­tion.

Obama’s law re­quires in­sur­ers to re­duce out-of­pocket costs like de­ductibles for lower-earn­ing cus­tomers, and man­dates that the gov­ern­ment re­im­burse the com­pa­nies. It costs the gov­ern­ment about $7 bil­lion an­nu­ally.

A fed­eral court has ruled Congress didn’t au­tho­rize the ex­pen­di­tures, but the sub­si­dies have un­til now con­tin­ued.

White House spokesman Ninio Fe­talvo ac­cused the bud­get of­fice of is­su­ing analy­ses that “have been off base for years.”

Fe­talvo said while the ad­min­is­tra­tion con­sid­ers whether to con­tinue the pay­ments, “real re­form which low­ers costs and ex­pands choices will only come from re­peal­ing and re­plac­ing Oba­macare.”

The bud­get agency has a ster­ling rep­u­ta­tion with most ob­jec­tive, out­side fis­cal ex­perts. The GOP ef­fort to erase Obama’s law failed in the Se­nate in July, and a re­newed ef­fort by some Repub­li­can se­na­tors to scut­tle the law is con­sid­ered un­likely to suc­ceed.

Con­tin­u­ing the fed­eral sub­si­dies “re­mains es­sen­tial to the sta­bil­ity of the in­di­vid­ual mar­ket,” said Kris­tine Grow, a spokes­woman for Amer­ica’s Health In­sur­ance Plans, that in­dus­try’s largest trade group.

The bud­get of­fice and in­sur­ance in­dus­try had pre­vi­ously pro­jected that 2018 pre­mi­ums would grow an aver­age 20 per­cent if Trump ac­tu­ally halts the sub­si­dies.

Sens. La­mar Alexan­der, R-Tenn., and Patty Mur­ray, D-Wash., have been try­ing to craft an agree­ment con­tin­u­ing the pay­ments for at least a year. In ex­change, Alexan­der wants Democrats to make it easier for states to re­lax the Obama law’s cov­er­age re­quire­ments, which Democrats are re­sist­ing.

The re­port said it ex­pects the 10 mil­lion Amer­i­cans buy­ing cov­er­age on gov­ern­ment-op­er­ated in­sur­ance ex­changes this year to grow to 11 mil­lion in 2018.

But it said that in­crease would be con­strained by ris­ing pre­mi­ums plus steps the Trump ad­min­is­tra­tion has taken, such as cut­ting out­reach pro­grams that pub­li­cize the ex­changes and re­duc­ing the pre­vi­ous 90-day en­roll­ment pe­riod to 45 days.

Of the 10 mil­lion peo­ple buy­ing cov­er­age on in­sur­ance ex­changes, 8 mil­lion qual­ify for fed­eral pre­mium sub­si­dies. Those sub­si­dies rise au­to­mat­i­cally with pre­mi­ums, so those cus­tomers would largely be pro­tected as pre­mi­ums grow.

But 2 mil­lion peo­ple buy­ing cov­er­age on ex­changes who don’t get those sub­si­dies, and 6 mil­lion oth­ers buy­ing in­di­vid­ual poli­cies on their own out­side the mar­ket­places, would not be shielded from grow­ing pre­mi­ums.

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