Focus on fixing insurance exchange

The problems with the insurance exchange in Iowa are fixable — and not a good excuse to fund tax cuts to the wealthy by forcing tens of thousands of Iowans off health insurance.

It’s time for Iowa’s congressmen and senators to start working on immediate measures to strengthen the health care system, and specifically the health insurance exchange, or marketplace. The obsession of some with bills to repeal and replace Obamacare has been a distraction from that task.

In recent days, bipartisan groups have sprung up in both the House and the Senate to begin developing legislation to stabilize the insurance market. These groups recognize the immediate need for measures to ensure that federal payments continue for cost-sharing reductions (CSRs) that help low-income people afford their copays and deductibles. Without the assurance that these payments will continue, premiums will rise sharply.

The president has threatened to continue his efforts to sabotage the Affordable Care Act (ACA) by ordering an end to CSRs. This threat has already prompted Medica, the only Iowa health insurance company still offering plans on the exchange, to plan for another premium increase.

The bipartisan efforts to shore up the insurance exchanges could include another important measure: a reinsurance program that would reduce the risk that a small number of high-cost customers will cause insurance company losses. The “million-dollar customer” has been cited as a factor contributing to the decisions of Wellmark and Aetna to exit the Iowa exchange. Reinsurance would establish a national pool to cover high-risk cases; this would allow companies to remain in the exchanges without drastic premium increases on everyone to pay for those few cases.

The Senate’s attempts to repeal and replace failed because they were wildly unpopular. These measures would have resulted in over 200,000 Iowans losing health insurance; would have effectively ended the expansion of Medicaid that covers thousands of low-wage workers; would have reduced Medicaid benefits for thousands of seniors, children, and people with disabilities; would have raised premiums and deductibles; would have gutted protections for persons with pre-existing conditions; and would have provided billions in tax cuts to wealthy individuals and corporations.

Another attack on coverage: Graham-Cassidy

Pragmatic efforts to stabilize the health insurance market stand in stark contrast to a last-ditch attempt to repeal and replace Obamacare that surfaced this week: the Graham-Cassidy plan. Like the previous failed bills, this plan would end the Medicaid expansion that now covers 150,000 Iowans.

Unlike previous repeal and replace bills, the Graham-Cassidy plan would also end the premium assistance that makes health insurance affordable to tens of thousands of low and moderate income Iowa families. While it replaces ACA funding of premium assistance and Medicaid expansion with a block grant, it provides no guarantee that the states will use that block grant to make health insurance affordable to those who need help the most. And the bill would further destabilize the insurance market by ending the mandate to purchase insurance, while making it more expensive, leaving insurance companies with the sickest and costliest customers.

The problems with the insurance exchange in Iowa are fixable. Let’s see if our Senators and Representatives actually try to fix those problems instead of using them as an excuse to fund tax cuts to the wealthy by forcing tens of thousands of Iowans off their health insurance.

Peter Fisher is research director of the Iowa Policy Project.

pfisher@iowapolicyproject.org

Why Governor Reynolds is wrong

If the Governor cannot speak for the people of Iowa, who will do so?

As it has become clear that Iowa state leaders need to be more engaged publicly on the national health care debate, it was surprising to see Governor Kim Reynolds’ take on it.

“I’m focused on the things I can control.”

Well, if that is the standard for where the Governor should speak up, lock the office door and throw away the key. That’s not the way government works — or is supposed to work — in our American and Iowa tradition.

The Governor in our system has an important and powerful role, but rarely a controlling one.

What the Governor is not acknowledging, though she surely knows to be the case, is that her position is perhaps the best pulpit in the state of Iowa for speaking up on behalf of Iowans, to our elected representatives in the House and Senate in Washington, and to the President of the United States.

If she cannot speak for the people of Iowa, who will do so?

What is clear from the debate thus far in Washington is that more than 200,000 Iowans will lose health insurance if the current Affordable Care Act is repealed without a meaningful replacement.

In fact, the latest estimate from the Urban Institute finds 229,000 fewer Iowans would be insured in 2022 than if the ACA were kept in place — but the state would spend $29 million more as federal spending dropped by 28 percent.

The Governor’s comments to reporters repeated inaccurate talking points about ACA, avoiding both the state’s own role in undermining the individual insurance marketplace, and the principal way Iowans would lose insurance: the loss of the Medicaid expansion. That one piece of the ACA covers 150,000 Iowans now and is projected to grow to 177,000 in two years, but goes away under the Senate and House plans.

So, whether Governor Reynolds likes it or not, what is now a federal issue will become a state issue.

Right now, the things she has more direct influence upon are state budget choices, many of which already are difficult.

Imagine how much more difficult those choices become with 200,000 more people uninsured. What will the state do to make up for it? What budget control — or families’ control over their health care options — would be lost? Some members of the Legislature already are calling for a state-run program to step into the void.

If Governor Reynolds is uncomfortable with any of these possibilities she could call her friends Senator Grassley and Senator Ernst, or gather the microphones and cameras and raise awareness about the stakes for all Iowans.

Again, there are members of the Legislature weighing in on that score as well. Perhaps they recognize that persuasion, and pushing for a critical mass of support behind an idea, is where “control” emerges.

 

owen-2013-57Mike Owen, executive director of the Iowa Policy Project

mikeowen@iowapolicyproject.org

 

Why not a special session?

Now is the time to be speaking frankly about the longer-term impacts of health care policy — and that might make a special session useful, sooner rather than later.

Long-term impacts could be decided in short order;
Might not our state lawmakers want to weigh in?

If anything has been clear about the current health-care debate in Washington, it is that little is clear — except the likelihood that (1) people will lose insurance coverage and thus access to health care, and (2) this will pose new challenges for state government.

That being the case, it seems a good time for the Legislature to return to Des Moines and sort it out, sooner rather than later. It will be easier for legislators to talk to their federal counterparts about all this before legislation passes than afterward.

Because of the Affordable Care Act (Obamacare), the Medicaid expansion serves about 150,000 Iowans, and would serve an estimated 177,000 Iowans in 2019 if preserved. But those Iowans — and some 55,000 more — would be in jeopardy of losing insurance under legislation pending in the Senate. If the enhanced federal share of funding for Medicaid expansion is reduced or eliminated under any legislation to come — and both the House and Senate bills currently would do this — states would have a choice: Fill in the gap or let people go uninsured.

Oh, and if you’re going to choose to fill in the gap, go ahead and plan now on what will have to be cut to compensate for it. K-12 education, perhaps? Even more cuts to the regents institutions? Child care? Water protection? Law enforcement and corrections?

Already, legislators and Governor Kim Reynolds are facing those kinds of questions amid a looming fiscal shortfall and speculation about a possible special session.

In The Des Moines Register this week, columnist Kathie Obradovich suggested Governor Reynolds “is prudent to wait until fall to make a decision on a special session but that doesn’t mean she should avoid talking about it. Now is the time to be speaking frankly with Iowans and individual legislators, identifying the causes and consulting on potential solutions.”

Now is also the time to be speaking frankly about the longer-term impacts of health care policy — and for that reason, waiting until fall might be too late. Legislative leaders and the Governor right now could be bringing in experts for a special session to discuss the potential impacts, and reach out to the congressional delegation, before decisions are made that restrict state budget choices for many years to come.
Unless, of course, they want to see budget crunches and special sessions more frequently.
Mike Owen, Executive Director of the Iowa Policy Project
mikeowen@iowapolicyproject.org

Health care ‘reform’ just keeps getting worse

The bottom line: worse health care coverage at higher cost to millions, loss of coverage entirely to millions more, in order to finance tax cuts for corporations.

The House Republican plan to replace Obamacare (the Affordable Care Act) with the American Health Care Act (AHCA), which a few weeks ago failed to even come to a vote, has been reincarnated. The new version of the AHCA has apparently won the support of the Freedom Caucus in the House, but in so doing has become significantly worse for millions of Americans.

Here are the key points about this new attempt to “repeal and replace” Obamacare:

  • Despite repeated promises to keep the most popular part of Obamacare, the provision prohibiting insurance companies from refusing to cover those with pre-existing conditions, the new version returns us to the bad old days. While a particular state may choose to keep the prohibition, there is no longer any nationwide requirement that insurance companies issue affordable policies regardless of pre-existing conditions.
  • Nationwide standards for health insurance policies will be rolled back; plans will no longer be required to cover services such as mental health, maternity care, or substance abuse treatment.
  • The nationwide prohibition on lifetime and annual limits on benefits will be gone, meaning the possibility of medical bankruptcy will loom once again for many.
  • The modified version of the bill still effectively ends the Medicaid expansion; about 150,000 Iowans now covered under that provision could lose insurance altogether.
  • The bill still cuts $840 billion from Medicaid over 10 years, most of the savings going to wealthy individuals, drug companies, insurance companies, and other corporations.
  • Premiums and deductibles will still rise for large numbers of persons buying insurance on the exchanges, especially for the elderly, those with lower incomes, and those in high-cost states or areas, such as most of rural Iowa.
  • Under the bill, there would be no limit on the premium an insurance company can charge based on medical history; thus someone with pre-existing conditions could in theory be offered coverage, but at a cost that is simply unaffordable. There is little difference between this situation and straight denial of coverage. A state could choose to prohibit this practice (i.e., to keep the Obamacare provision in place), but few states chose to do so before Obamacare.

While the proponents of this revised plan may argue that it keeps the prohibition on gender discrimination, a woman would pay substantially more for a plan that included maternity coverage. Such coverage would not be a required part of all plans, but instead would be an expensive option.

Just how this revised bill would affect overall coverage rates, premiums, and out-of-pocket costs, awaits a new analysis by the Congressional Budget Office. But it is quite possible that the bill will be voted on in the house without the benefit of that analysis. Part of the pressure to pass the bill now comes from the desire on the part of the Trump administration to come up with large savings to the federal government that can then be used to finance cuts to corporate and individual income taxes.

The bottom line: worse health care coverage at higher cost to millions, loss of coverage entirely to millions more, in order to finance tax cuts for corporations (and probably millionaires as well).

Posted by Peter Fisher, research director of the nonpartisan Iowa Policy Project. pfisher@iowapolicyproject.org

Also see Fisher’s March 2017 policy brief for the Iowa Fiscal Partnership: “Replacing ACA: What you need to know about the AHCA.”

Today’s virtual House graphic: Iowa impact of ACA repeal

170119-IFP-ACA-F1

Yes, whatever actions are taken on the Affordable Care Act will come from Congress, but state legislators may be left to pick up the pieces. Iowa legislators, are you paying attention? Are you talking to your federal counterparts about this? (Some are in the state this week.)

What many may not know is the impact the ACA has had on reducing the uninsured population in Iowa. The Medicaid expansion under the ACA is one of the big reasons we have seen a greater share of the Iowa population covered by either public or private insurance.

For more information on how the ACA has affected uninsurance in Iowa — and the stakes of repeal without an adequate replacement — see Peter Fisher’s policy brief, Repealing ACA: Pushing thousands of Iowans to the brink.

Editor’s Note: The Iowa House of Representatives now denies the ability of lawmakers to use visual aids in debate on the floor. To help Iowans visualize what kinds of graphics might be useful in these debates to illustrate facts, on several days this session we are offering examples. Here is today’s graphic, to illustrate the impact on Iowa, and potentially on state finances and responsibilities, if the federal Affordable Care Act is repealed.