Insurance Market and Medicaid Landscape for 2018 NASTAD Prevention - - PowerPoint PPT Presentation

NASTAD Prevention and Care Technical Assistance Meeting— Advancing Health Equity Alexandria, Virginia June 20, 2017

Insurance Market and Medicaid Landscape for 2018

Greg Gierer Vice President, Policy & Regulatory Affairs

Agenda

• Repeal/Replace
• Immediate Challenges to Market Stability
• Policy Options to Promote a Stable Market

AHIP Senate Positioning to Date

Legislative Proposals – Repeal and Replace 4

• Medicaid-Individual Market Linkage
• Short-term Individual Market Stability
• Adequate Transition Period
• Medicaid: Beneficiary Needs, Funding and

Flexibility

• Long-Term Market Priorities: Individual and

Broader Markets

Senate Finance Letter

Immediate Challenges to Individual Market Stability

Current State of Exchanges 5

Issue sue Poli licy Imp mplications ations

Cost-Sharing Reduction (CSR) Payments Failure to fund cost-sharing reductions would result in significant market disruption and fewer plan choices, significantly higher premiums for 2018, and higher federal spending Enforcement of Individual Mandate Lack of individual mandate enforcement would lead to deterioration of the risk pool and higher premiums for 2018 and beyond (15%-20% higher) Risk Pool Funding Sunset of reinsurance program was a significant factor in 2017 premium increases; re-instating risk pool funding would likely have a stabilizing effect Legislative and Regulatory Uncertainty Legislative/regulatory actions can either bring greater stability

• r exacerbate current problems

Individual Market Stabilization Package: Key Elements

Policy Options to Promote a Stable Market 6

Provisions Overview

Market Rating Rules

• Expand the age band from 3:1 to 5:1.
• Retain guaranteed issue and renewability, metal levels, risk adjustment,

cost sharing reductions, and other market rule provisions Reinsurance Program

• Create an individual market reinsurance program with $100B in funding
• ver ten years ($10B a year)

Incorporate 2017 Market Stabilization Rule

• Implement the provisions of the new market stabilization rule

Implement a “Copper” 50 Percent Actuarial Value Plan

• Allow health plans to offer a “Copper” metal level variation of 50% AV and

allow individuals to use tax credits to purchase “Copper” plans Enhance APTCs for Young Enrollees

• Retain the APTCs with age adjusted modifications.
• Individuals from 18 – 34 receive the same APTC amounts as those

individuals aged 35 in their rating region

Methodological Note: Assumes enforcement of current law and regulations; no large scale changes in market participation.

Elemen ent Impact mpact Individual market enrollment 7.5% increase (2+ million higher) Impact on uninsured 5.5% decrease (2+ million fewer uninsured) Risk pool Average risk scores decline by about 5% (risk scores decline from 1.35 to 1.28 by 2020) Individual market premiums 14% reduction Federal spending $32.4 billion higher

Stabilization Package Modeling Results*

*Avalere modeled cost/coverage impact of stabilization policies over a 5 year period (2018-2022), as compared to current law. Assumes CSR funding and enforcement of individual mandate.

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