Health Plan Payment and Reimbursement

Aug. 27-31: Individual Market Rates Roll in Amid Tweaks

August 24, 2018 8:41 am

A new federal watchdog report found the Trump administration had mixed impacts on costs in the individual market, while states have taken on a growing stabilization role.


Aug. 23—States are scrambling to implement last-minute supports for the individual-insurance markets, even as 2019 rates begin to be finalized.

With final rates expected to continue to roll in over the coming weeks, unexpectedly lower premiums have emerged among the proposed rates and the earliest finalized ones.

Average national rate increases in the Affordable Care Act (ACA) marketplaces—among the six states with final rates and the remainder with proposed rate submissions—were 4.18 percent, according to the Aug. 23 compilation by a national tracking site, That was down from 6.8 percent in early August and far below the 29.68 percent average approved rate nationwide for 2018, according to the website.

The finding of improved rates was echoed this month in a Kaiser Family Foundation tracking survey, which found average proposed premiums for all plan levels in eight states will increase by less than 9 percent in 2019. In comparison, the 2018 increase in mid-priced plans averaged 37 percent nationally.

The dramatically lower rate increases came amid ongoing assertions of critics that the Trump administration is attempting to sabotage the ACA marketplaces. Administration officials respond that the marketplaces are failing on their own, but they also highlight steps they have taken to bolster the insurance exchanges, as they also are known.

For instance, the administration approved on Aug. 22 a Section 1332 waiver for Maryland that will allow federal pass-through funding to partially finance a reinsurance program. In 2019, the program will derive $380 million of the $462 million reinsurance cost from an assessment on health plans, according to published reports.

It was estimated that the reinsurance program will reduce average 2019 premium increases by about 30 percent.

The Maryland waiver approval came a week after approval of a reinsurance waiver for New Jersey. That agreement will provide federal pass-through funding to partially finance the reinsurance program, which will pay insurance companies 60 percent of claims between $40,000 and $215,000.

New Jersey’s share of the funding for the reinsurance program will come from tax penalties generated by a new state insurance mandate. Congress scrapped the penalty for the ACA’s federal individual mandate beginning in 2019.

Four other states—Alaska, Minnesota, Oregon, and Wisconsin—previously received approval of their reinsurance waivers.

Gary Cohen, a former federal leader of the ACA marketplaces under President Barack Obama, said this week on Twitter that “states can mitigate most of what Trump has done to undermine the ACA” through steps that include adopting a mandate and establishing a reinsurance program.

Coming Actions

On Aug. 20, the Centers for Medicare & Medicaid Services (CMS) awarded a total of $8.6 million to 30 states and the District of Columbia to fund efforts by state insurance regulators to strengthen their health insurance markets. Among initiatives the grants can fund are economic analyses and adoption of the various “coverage options under new flexibilities offered to states by CMS.”

The options promoted by the administration do not include other steps that states have begun to take to bolster their markets. For instance, some are moving to ban short-term health plans and limit the availability of association plans.

The nonpartisan Government Accountability Office (GAO) issued a report this week that concluded the administration has taken steps that both helped and hurt enrollment in the ACA marketplaces. For instance, eliminating federal cost-sharing reduction payments to insurers in late 2017 resulted in large premium increases for some marketplace plans and large premium cuts for others—due to the complex interaction of various marketplace components.

The U.S. Department of Health and Human Services (HHS) agreed with GAO’s recommendation to improve data used for navigator grants and to provide navigators with clearer guidance. But HHS rejected the return of annual enrollment goals, citing the impact of factors outside of its control, such as an improving economy that may give enrollees access to employer-sponsored insurance.

Monday, Aug. 27

Webinar by CMS titled “SNF Follow-Up Webinar on Section N: Medications.” Learn more.

Deadline to submit Hospital Value-Based Purchasing (VBP) program FY19 review and corrections calculation requests to CMS. Learn more.

Webinar by the National Academies of Sciences, Engineering, and Medicine on a new report titled “Crossing the Global Quality Chasm: Improving Health Care Worldwide.” Learn more.

Webinar by the Advisory Board titled “How to Win a Greater Share of Top Talent.” Learn more.

Tuesday, Aug. 28

End of public comment period for the CMS initiative “Development and Implementation of Quality Rating System (QRS) Measures for Qualified Health Plans (QHPs).” Learn more.

Web conference by the Advisory Board titled “How to Maximize Efficiency Through Centralized Pharmacy Inventory.” Learn more.

Wednesday, Aug. 29

Webinar by HFMA titled “Delivering Measurable Value with Healthcare Analytics at Stamford Health System.” Learn more.

Hearing by the Senate Health, Education, Labor and Pensions Committee titled “FDA Oversight: Leveraging Cutting-Edge Science and Protecting Public Health.” Learn more.

Webinar by CMS for participants in the Hospital Inpatient Quality Reporting (IQR) program titled “Navigating Hospital IQR Program Reports: Tips to Access, Run, and Review.” Learn more.

Webinar by athenahealth titled “achieving interoperability.” Learn more.

Web conference by the Advisory Board titled “MPFS 2019 Proposed Rule: How Medicare Wants to Pay Providers Next Year.” Learn more.

Connected Health Summit (through Aug. 30). Learn more.

Thursday, Aug. 30

Webinar by HFMA titled “Explore How Aggregation Groups Help Healthcare Providers Drive Down Cost and Improve Delivery of Care.” Learn more.

Webinar by CMS titled “Introduction to the Hospice Quality Reporting Program (HQRP).” Learn more.

Webinar by the Interprofessional Education Collaborative (IPEC) titled “An IPE Approach to the Opioid Epidemic.” Learn more.

Friday, Aug. 31

Deadline for correction requests of Annual Performance Score Reports for the FY19 Skilled Nursing Facility Value-Based Purchasing program. Learn more.


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