- A federal judge ruled Wednesday that President Donald Trump’s administration does not have to immediately resume making cost-sharing reduction (CSR) payments to insurers participating in the Affordable Care Act (ACA) exchange markets.
- Also Wednesday, the Congressional Budget Office released a report on a bipartisan proposal to appropriate the CSRs through legislation. The analysis found that the bill named after key sponsors Sens. Lamar Alexander (R-La.) and Patty Murray (D-Wash.) would reduce the deficit by $3.8 billion in the next 10 years and would not substantially change coverage rates.
- Meanwhile, Avalere released an analysis that found premiums for silver level plans on the ACA exchanges will increase by an average of 34% next year.
The Alexander-Murray bill’s chances have taken a hit recently as two influential Republicans this week released a more conservative plan that would fund the CSRs but also end penalties from the individual and employer mandates as well as add unspecified “pro-life protections.” The somewhat favorable CBO report could improve prospects for Alexander-Murray, but it will need 60 votes to proceed, a level of agreement that has been hard to find on Capitol Hill recently.
The ruling Wednesday stems from a lawsuit brought by nearly 20 state attorneys general immediately after Trump announced last week his administration would no longer be making the payments, which have amounted to about $7 billion so far this year. Now that the attempt to force the payments through a temporary order has failed, payers may file their own lawsuits rather than wait for congressional action.
Judge Vince Chhabria said he was siding with the administration because states have been able to work around the end to CSRs. "And although you wouldn't know it from reading the states' papers in this lawsuit, the truth is that most state regulators have devised responses that give millions of lower-income people better health coverage options than they would otherwise have had," he wrote.
Major industry organizations, including the American Hospital Association, American Medical Association and America’s Health Insurance Plans, support the Alexander-Murray plan, which commits to two years of CSR funding.
The Avalere report found premium rate changes will vary substantially from state to state. Iowa, for example, will see the largest average increase at 69%, while Alaska will see a decrease of about 22%. The overall average increase is the result of market instability and the ending of CSRs, according to the report, which concluded the increases "may allow insurers to remain in the market and enrollees in all regions to have access to coverage."
Several payers have scaled back their participation in the exchanges for next year or pulled out entirely because of market instability concerns. Anthem said this week it expects a 70% decrease in ACA plan enrollment next year. In contrast, Centene is saying it will expand its ACA exchange footprint among an overall Q3 revenue increase of nearly 10%.
Open enrollment for ACA plans begins in less than a week. Supporters of the ACA are concerned that enrollment numbers will be low because the administration has drastically cut funding to promote open enrollment, shrunk the enrollment period and announced the HealthCare.gov website will go dark for 12 hours on all but one Sunday of the enrollment window. Also, HHS said this week it will not set a target number for enrollees as it has done in previous weeks.
A report released Wednesday from the HHS Office of Inspector General outlined confusion surrounding the decision to cancel a number of enrollment outreach activities. Conflicting instructions ended up leaving the department with about $1.1 million in unrecoverable expenses.