INDIANAPOLIS – Massive uncertainty created by the chaotic Republican health care overhaul may cause health care premiums to skyrocket this coming year. According to reports today in the IndyStar, Indiana’s health insurers are struggling to set upcoming premiums, in large part because of the Administration’s attempts to withhold cost-sharing subsidies. While insurers insist that they could keep premiums low with more policy clarity, Hoosiers will blame any high rates on Republicans’ repeated attempts to break insurance markets.
WASHINGTON – Now that health insurance giant Anthem has started withdrawing from Obamacare health exchanges, is Indiana next?
Indianapolis-based Anthem announced Tuesday it won’t sell plans next year in Ohio, one of 14 states where it participates in the health exchanges created by the Affordable Care Act for people who don’t get coverage through an employer or government plan. More than 170,000 Hoosiers use Indiana’s exchange where Anthem is the largest player.
But the reasons the company cited for leaving Ohio’s market are national. Anthem blamed an “increasing lack of overall predictability” about the individual insurance market, which could radically change depending on actions taken by the Trump administration and Congress over the next few months.
The administration, for example, hasn’t decided whether to continue paying insurers about $7 billion a year to reduce co-payments and deductibles for about 7 million lower-income customers.
Insurers have estimated they will need to raise rates by up to 20 percent if the subsidies are eliminated.
Anthem CEO Joseph Swedish cited the political and regulatory uncertainty last month when commenting on the company’s ongoing discussions with state insurance agencies about its continued participation in the individual market. Speaking at the UBS Global Healthcare Conference, Swedish said Anthem would prefer not to withdraw “if we can get the math to work,” according to The New York Times.
Anthem is one of four insurers selling plans in Indiana’s market. Although the company sells the most plans on Indiana’s exchange, its withdrawal would not leave any county without a provider as long MDwise – the other insurer which offers plans in all 92 counties – remains. But MDwise CEO James Parker told Indiana Sen. Joe Donnelly, D-Ind., last month MDwise will be forced to either significantly increase premiums or stop offering plans if the cost-sharing subsidies stop.
The bill the House passed last month to repeal and replace Obamacare would end the cost-sharing subsidies and change the premium supports. In general, younger and richer people living in areas with lower costs would get more help than they do now in premium supports. Older, poorer people in areas with higher costs would get less assistance.
Although the premium supports — along with the overall fate of the narrowly-passed bill — remains uncertain as the Senate struggles to come up with its own version, the cost-sharing subsidies could be ended by the Trump administration.
House Republicans had sued the Obama administration to stop those payments, saying they hadn’t been approved by Congress. The Trump administration has delayed telling the federal court whether it will continue the Obama administration’s defense of them.
Trump, who said Tuesday Anthem’s decision is a sign that insurers are “fleeing and leaving” Obamacare, has wanted to use the subsidies as a bargaining chip to get Democrats to agree to rewrite the Affordable Care Act. But Democrats argue Republicans are undermining the stability of the market by their actions and that’s where voters will place the blame.