Obamacare Stability Issues Have Trade Groups Speaking Up

Amid recent reports that the Affordable Care Act's premiums are proving unsustainable for insurers, associations representing both hospitals and the insurance industry are offering the federal government some feedback on the issue.

With the Affordable Care Act’s bedrock exchanges looking more unsteady than ever, some associations are calling for big changes.

Last week, the American Hospital Association sent an open letter to Sylvia Mathews Burwell, the U.S. Secretary of Health and Human Services, calling for HHS to take steps to ensure that insurers remain active in the marketplaces.

“We urge you to make several changes to marketplace policies and operations to stabilize the insurance markets and encourage robust consumer and insurer participation,” wrote AHA President and CEO Richard J. Pollack [PDF].

In the letter acquired by Modern Healthcare, Pollack recommended five steps to better stabilize the program for the long run:

  • Strengthen of the special enrollment periods so that the public signs up for insurance before they need it.
  • Refine the risk-adjustment program.
  • Boost access to third-party payment for premiums for low-income Americans.
  • Strengthen outreach strategies for enrollment.
  • Provide federal support for solutions developed at the state level.

Pollack, in speaking of a need to stabilize the pricing for insurance plans, emphasized that the recent price increases for premiums offered by insurers are troublesome: “We have reason to believe that such increases may be a one-time correction and necessary to stem insurer losses moving forward.”

Insurers Struggle With Instability

The letter comes days after one of the country’s largest insurers, Aetna, announced it was exiting most of the exchanges. Earlier this month, The Huffington Post reported that the insurer’s move may have been tied to the Justice Department’s decision to reject Aetna’s merger with Humana, one of the company’s competitors.

In a letter to Justice Department officials [PDF], Aetna CEO Mark T. Bertolini said that the losses the company was experiencing by entering different exchanges made the situation untenable for the company.

“[B]ased on our analysis to date, we believe it is very likely that we would need to leave the public exchange business entirely and plan for additional business efficiencies should our deal ultimately be blocked,” the letter stated.

Aetna left the health insurer trade group America’s Health Insurance Plans (AHIP) earlier this year. But the association, for its part, has similar issues with the law.

In an op-ed for USA Today, AHIP CEO Marilyn Tavenner raised concerns with the “risk corridors” program that is part of the act.

“Some game the system — such as those who wait to sign up for coverage until they get sick, or provider groups that pay patients’ premiums so they can bolster their reimbursements,” Tavenner wrote. “And when too many families are struggling every day, living paycheck to paycheck, the soaring cost of medical care forces too many to pay too much.”

Tavenner emphasized that HHS should focus on “reducing rising medical costs” to increase affordability.

Ernie Smith

By Ernie Smith

Ernie Smith is a former senior editor for Associations Now. MORE

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