As anticipated, we have seen major developments since our cost-sharing reduction (CSR) blog post just a short two months ago. As a refresher, CSR payments are a discount that lowers the amount a low-income patient pays for deductibles, copayments and coinsurance. In early October, President Donald Trump announced his decision to stop CSR payments, leaving many legislators, experts and others concerned about potential health care cost increases and the stability of the health care market.
Although health insurance companies will stop receiving these payments, they are still required to offer out-of-pocket discounts to qualifying patients. The nonprofit Kaiser Family Foundation estimated that insurers would have to raise premiums by approximately 19 percent to make up for the loss of the government’s payments. (Consumers receiving tax credits for their premiums shouldn’t be affected by premium increases.)
Health insurance companies have expressed their concern over this revenue loss. Aetna is on pace to lose $750 million from its participation in the state health insurance exchanges and has decided not to participate in 2018. Humana announced it would also leave the exchanges, saying they were too risky after losing $45 million in the individual market in 2017. An additional revenue loss of this size leads policy makers to question whether many health insurers will continue to participate in the marketplace.
Opponents believe President Trump’s decision was intended to harm the Affordable Care Act, also known as “Obamacare.” Senate Minority Leader Chuck Schumer (D-N.Y.) and House Minority Leader Nancy Pelosi (D-Calif.) issued a joint statement calling the decision "sabotage." Many Republicans, however, applauded this decision, maintaining that former President Obama unlawfully allowed these payments without the approval of Congress.
While the CSR debate continues on Capitol Hill, patients remain concerned about the projected premium increases. Because President Trump continually threatened the stop CSR payments, many health insurers set their 2018 health plan rates with the expectation of losing these payments. Health insurers that assumed the payments would continue were able to adjust their 2018 rates upward, under the review of the federal Centers for Medicare and Medicaid Services and state insurance departments.
Despite rate changes, the full impact on health care plan prices has yet to be seen. The decision to permanently stop, reinstate or make adjustments to CSR payments is now in the hands of Congress.
A bipartisan attempt to shore up the marketplace
Senators Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) have introduced the Bipartisan Health Care Stabilization Act to help stabilize the ACA marketplace. This bill would reinstate CSR payments for two years. If passed, the bill would reassure insurers who are already planning 2019 rates.
The Congressional Budget Office (CBO) projects that cutting CSR payments would save the federal government $3.8 billion by 2027 and would lead to an average premium increase in 2018 of 20 percent and increase federal spending on premium tax credits by $6 billion. These numbers have increased the bill’s chance of passage. If this is not passed as a standalone bill, there are discussions around incorporating it into another year-end legislation package.
What can you do to help? It is important that our elected officials hear from their constituents and the psoriatic disease community about the importance of keeping costs low for patients and ensuring their access to affordable care. If you would like to learn more about CSR payments and how you can effectively reach out to your members of Congress, please visit the NPF Advocacy webpage or contact Amy Prentice at firstname.lastname@example.org. Your voice matters!
Driving discovery, creating community
For more than 50 years, we’ve been driving efforts to cure psoriatic disease and improve the lives of those affected. But there’s still plenty to do! Learn how you can help our advocacy team shape the laws and policies that affect people with psoriasis and psoriatic arthritis – in your state and across the country. Help us raise funds to support research by joining Team NPF, where you can walk, run, cycle, play bingo or create your own fundraising event. If you or someone you love needs free, personalized support for living a healthier life with psoriatic disease, contact our Patient Navigation Center. And keep the National Psoriasis Foundation going strong by making a donation today. Together, we will find a cure.