Five weeks ago, the Trump administration announced that it was rolling back protections established by the Obama administration on who could enroll in and receive coverage on the newly conceived public health insurance exchanges. Let’s get to the basics: What’s this all about?
What is the Trump administration doing?
The original announcement was made on 15 June, when the department of health and human services, or HHS, announced that it was discontinuing Section 1332 waivers that it had approved for 14 health insurance providers in six states. Among those insurers were Aetna, Humana, Blue Cross Blue Shield of North Carolina, Health Freedom Blue Cross and other insurance providers. What’s more, the Trump administration said that it was also rescinding an Obama administration rule that allowed issuers to access funds provided by the federal government to help enrollees with any financial burden such as unexpected medical bills.
How did this all work?
Section 1332 of the Affordable Care Act was created to relieve healthcare providers such as hospitals and doctors from having to deal with their share of the cost of providing coverage to poor and chronically ill people. Of the 30 states that were still providing some form of public insurance to the poor or people with pre-existing conditions, 20 were reimbursed the federal government for covering their costs on the ACA’s public exchanges. The remaining four were also reimbursed for covering enrollees’ costs under Medicaid, the joint state-federal program that covers the poor and covers people with disabilities.
So what the heck’s going on?
On 15 June, the Trump administration said that Section 1332 waivers would no longer be available for providers, many of which were small businesses. In addition, the administration claimed that it had found that CMS had refused to approve about one-third of the requests to use Section 1332 waivers to provide coverage on the public exchange, a tiny fraction of the more than 6,000 requests that had been submitted.
This entire situation is really a game of sound and fury signifying something very different.
Does this mean that Title X funding will now be withheld from providers in affected states who cannot afford to provide affordable insurance to their patients? No. It just means that the government can no longer reimburse those providers.
About 52 million Americans receive some kind of medical care at a hospital or clinic every year. (CMS does not count people who take out an insurance policy through their employers. This means that the ACA covers only about 18% of the 48 million people in this group.)
Under the ACA, providers had the option of using the individual or community-rated funding they received from CMS (known as premium subsidies) to cover the cost of the portion of patient costs they were responsible for. All the while, these providers could seek federal reimbursement for their share of the cost of providing care – a cost that would not increase or fall proportionately with their patient load.
Does this impact who can enroll in or receive coverage through the public exchange? No. CMS funds are tied up in the insurance marketplaceplaces – to the tune of $200m in premium subsidies for the open enrolment period that ends on 30 October. So, enrollees will still have access to affordable coverage under the ACA if they want it.
Yes, enrollees in this group can opt out of the health insurance marketplaceplaces in order to keep their deductible – the amount of money they must spend before they receive any health benefits from a particular treatment – to a certain amount. Enrolling in a plan will likely mean a higher deductible if you’re at the lower-end of the insurance market.
The Trump administration has no intent of keeping enrollees from choosing high-deductible plans. Instead, it has the intent of damaging the ability of public insurers to offer affordable coverage to a mass segment of the American public that made up the core of the ACA’s original signing contingent: people without employer-sponsored coverage.
How will this affect me?
It means that some people who qualified for public benefits in the past are going to end up without coverage. What’s more, it means that state insurance pools are likely to run low on the solvency of these subsidized plans. All of these problems could also mean that the ACA could be in violation of federal law.