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Insurance Department devises way around Trump’s ACA executive order

Tuesday, Oct 17, 2017 - Posted by Rich Miller

* It’s good to finally see a positive story about proactive governing coming out of the Rauner administration. Insurance Director Jennifer Hammer deserves much credit for this...

Even before President Donald Trump announced plans last week to nix Obamacare subsidies, the Illinois Department of Insurance raced over the summer to get insurers on board with a strategy to minimize the financial pain of such a move.

The action in essence allows Illinois—as well as more than two dozen other states adopting the maneuver—to sidestep Trump’s recent moves to undo major portions of his predecessor’s signature health insurance law.

Trump on Oct. 12 ordered the federal government to stop paying the cost-sharing subsidies provided to insurers to defray the cost of covering low-income people. But the Rauner administration has found a way to make the federal government pick up the tab anyway.

Consumers who qualify for cost-sharing subsidies under the Affordable Care Act are only allowed to use the aid to buy so-called silver plans—mid-level policies that cover certain basic services such as maternity care and emergency room services. Anticipating that Trump would eventually do away with the subsidies to insurers, Team Rauner directed carriers that aim to sell Obamacare insurance to Illinoisans in 2018 to attach a surcharge—on average, 15 percent—to silver-plan premiums.

That’s because as premiums rise, so do federal tax credits that reduce monthly premium costs for qualified consumers. Therefore, the federal government will absorb the cost of the increasingly expensive silver plans sold to subsidized buyers on the exchange, HealthCare.gov.

“Illinois deserves a great deal of credit to try to find a way to minimize the risk for both the consumers and their carriers,” said Sabrina Corlette, an Obamacare expert at the Center on Health Insurance Reforms at Georgetown University.

* Meanwhile, Phil Kadner makes some interesting points about the subsidies

Democrats ridicule Trump for having no plan to replace the Affordable Care Act (also known as Obamacare) and criticize the president’s executive order ending $7 billion in federal payments to insurance companies. Those payments were created by a Barack Obama executive order because Congress would not approve them.

Supporters of Obamacare contend the federal payments are not an insurance industry bailout but part of a plan to keep insurance premiums for high-risk individuals affordable.

But I see those payments in another way. Instead of proposing true national health care with a dedicated funding stream – as provided by almost every other civilized country in the world – we have a system that fails to control medical or prescription drug costs while encouraging millions of people to sign up for private health insurance. It is in essence a system designed to provide the private insurance industry with millions of new customers while we (taxpayers) act as underwriters to minimize the industry’s risk.

That’s because when the Clinton administration proposed real national health care reform, the insurance industry launched a massive campaign in opposition. The industry told Americans they would no longer be able to select their own doctors and that death panels would decide who would get medical treatment.

…Adding… Tribune

Key senators reached a breakthrough deal Tuesday on resuming federal payments to health insurers that President Donald Trump has blocked. Insurers had warned that unless the money is quickly restored, premiums will go up. […]

Murray and Alexander began talks on extending the payments months ago, when Trump was frequently threatening to stop the subsidies. Both had said they were close to a deal, but GOP leaders shut the effort down in September when the Senate revisited the Republican drive to repeal Obama’s law. The repeal effort failed, as did an earlier GOP attempt to dismantle the law in July.

Trump’s halt of the payments and worries about its impact have galvanized lawmakers in both parties to take action to prevent it.

       

9 Comments
  1. - Ducky LaMoore - Tuesday, Oct 17, 17 @ 2:33 pm:

    I finally have a reason to thank the Rauner administration. Thank you. Seriously. I love my silver plan.


  2. - anon2 - Tuesday, Oct 17, 17 @ 2:41 pm:

    It is refreshing to find something to compliment the Governor for. More like this please.


  3. - Name Withheld - Tuesday, Oct 17, 17 @ 2:49 pm:

    Until I see evidence that the Governor did more than make an unusually astute and intelligent choice for Insurance Director, credit for this - as Rich says - must be given to Jennifer Hammer. Near as I can tell from the article, this was the result of her and her staff’s hard work and diligence.

    Still, it is nice to see someone from the Administration actually doing something to help Illinoians instead of hurt them.


  4. - Ensured - Tuesday, Oct 17, 17 @ 2:49 pm:

    A reprieve from the anti-Illinois hostility nearing election season?
    Sounds Blagovechian.


  5. - wordslinger - Tuesday, Oct 17, 17 @ 3:57 pm:

    –But I see those payments in another way. Instead of proposing true national health care with a dedicated funding stream – as provided by almost every other civilized country in the world – we have a system that fails to control medical or prescription drug costs while encouraging millions of people to sign up for private health insurance. It is in essence a system designed to provide the private insurance industry with millions of new customers while we (taxpayers) act as underwriters to minimize the industry’s risk.–

    Yes. That’s always been the case.

    It’s the Heritage Foundation, Grassley/Baucus plan to keep the private insurance industry in the game rather than go to a single-payer like the rest of the planet.

    Republicans were all for it until Obama signed on and the Tea Party went apey. Then it became “socialism” somehow.

    But it’s also the reason Republicans can’t get together on a replacement plan. This was their plan.

    Instead, they just kept passing those repeal bills for seven years to con the remarkably gullible out of campaign contributions. You think they would have caught on after the 40th or 50th time.


  6. - VanillaMan - Tuesday, Oct 17, 17 @ 5:08 pm:

    Gee, the payments were unconstitutional. The Federal court confirmed this, yet Obama kept making them. They couldn’t continue without congressional approval.

    It didn’t take a genius to have seen a need for new funding sources. Bully for Rauner for recognizing the obvious.

    Rauner has been ILDEM’s best friend.


  7. - @MisterJayEm - Tuesday, Oct 17, 17 @ 5:49 pm:

    “It’s also the reason Republicans can’t get together on a replacement plan. This was their plan.”

    This can’t be repeated often enough.

    – MrJM


  8. - Ducky LaMoore - Tuesday, Oct 17, 17 @ 6:04 pm:

    @Wordslinger

    Truth. This is Mitt Romney’s and the Heritage plan. You would think Republicans would try to improve it to get some sort of credit instead of trying to destroy it.


  9. - Whatever - Tuesday, Oct 17, 17 @ 6:57 pm:

    The credit is only 72.5% of the premiums, so the consumer who qualifies for the credit is going to eat 27.5% of the rate increase. And, as the article points out, not everyone qualifies for the credit. But the insurance companies will make out just fine.


Sorry, comments for this post are now closed.


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