Health Care Insurers Are Freaking Out About Funding 2018 Plans


By Robert Donachie

Insurance companies are desperately trying to figure out President Donald Trump’s next move on health care reform as the deadline for filing 2018 plans on the Obamacare marketplaces approaches.

The providers are particularly concerned with what he will do with cost sharing reductions (CSRs), a little known feature of Obamacare, The Wall Street Journal reports. Insurers are required under the current system to provide CSRs to low and moderate income individuals who participate in the exchanges. To make consumers put more “skin in the game,” Obamacare effectively raised deductibles to levels that are tough for many Americans to meet without some financial support. CSRs were instituted to help insurers with the costs of deductibles patients can’t otherwise meet.

How the program works is rather straightforward. Insurers cover the cost of the patient’s deductible and the federal government reimburses the provider. (RELATED: The Potentially ‘Unconstitutional’ Aspect Of Obamacare Everyone Is Ignoring)

Under the leadership of former Speaker John Boehner, the House filed suit against the Obama administration in 2014, claiming it was illegally reimbursing marketplace insurers for CSRs.

The Obama administration then appealed the decision. The case remains open with no definitive ruling. Republicans have pushed back the court date twice. In February, Trump and Speaker of the House Paul Ryan got a hold approved until May 22.

Companies face different timetables for filing their 2018 plans. Some have until May 3 to file; others have a more pressing schedule of only a few days.

Insures are waiting to file their plans until Trump decides whether or not he will continue paying out CSRs in 2018. The president told The Wall Street Journal on April 11 that he was considering pulling CSR payments next year but did not take a definitive stance on the issue.

If Trump decides to let Obamacare “implode” and stops funding CSRs, he will effectively leave insurers with up to $10 billion in bad debt and consumers with backbreaking premiums.

Insurers are slated to meet with the president Tuesday where they hope to gain insight into the future of the Obamacare exchanges.

Insurance companies are warning that if Trump fails to make his policy preferences known they will be left with not choice but to account for the uncertainty on their end.

Companies report such a situation would mean larger rate increases and more withdrawals from marketplaces where it is no longer profitable for them to operate, The Wall Street Journal reports. Some insurers are toying with increasing rates as much as 20 percent.

The administration put forth a rule Thursday aimed at stabilizing the individual marketplace, which has become a victim of annual premium increases and is largely becoming non-competitive as more insurers pull out. While Thursday’s rule does not address CSR payments, it could work to ease some of the insurers concerns as the administration comes to its final determination.

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