The American Hospital Association is urging the U.S. Department of Health and Human Services to take measures to stabilize the Affordable Care Act's Health Insurance Marketplaces, saying some insurers' decisions to exit the marketplace put consumers' access at risk.
In a letter to HHS Secretary Sylvia Burwell, the AHA said that insurers' decisions to stop selling plans on these marketplaces will require millions of consumers to find new coverage in 2017. In particular, the group pointed to Pinal County, Arizona, where this trend has left the marketplace devoid of options, and lower-income consumers stand to lose access to advance premium tax credits and cost-sharing reductions that make coverage more affordable.
To stop insurers from pulling out, the AHA said, the significant losses they've experienced in their marketplace business need to be addressed. Those losses, the group said, have been largely the result of inaccurate assumptions about the needs of the newly enrolled and state regulators have been reluctant to allow insurers to increase rates.
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As a means of fixing the problem, the AHA has suggested there needs to be a focus on getting plan pricing right, and balancing the risk pool by enrolling healthier people.
"While the states play a significant role in approving rates, the administration should use its levers to improve the risk pools and better adjust reimbursement based on enrollee risk," the AHA wrote.
The organization issued a number of specific recommendations, including strengthening the special enrollment periods. Since some consumers have delayed enrollment until they need care, some insurers have suffered financial losses that put their marketplace participation at risk, the AHA said. The group contends that the Centers for Medicare and Medicaid Services should implement pre-approval for use of an SEP prior to enrollment. For those who are determined SEP-eligible, the AHA is imploring CMS to put in place consumer protections by making enrollment effective on the date of application, recognizing that consumers would be responsible for payment of premiums beginning at that date.
[Also: Obamacare marketplace shakeout rocks Arizona, Southeast]
For risk-adjustment programs, while the AHA said that the model generally works well, some modifications are needed to align payments with actual costs. Prescription drug data, for instance, could help identify diagnoses and accounting for partial-year enrollments.
The group is also requesting that federal agencies increase access to coverage through third-party payment of premiums. AHA members have expressed their desire to help low-income Americans pay the consumer's portion of the premium and cost sharing; subsidies would be awarded based on financial need, and the premium or cost-sharing payments would cover the entire policy year. The AHA's suggestion is to require qualified health plans to accept these types of arrangements for those not eligible for Medicare or Medicaid.
Further suggestions from the AHA include federal funds for targeted outreach campaigns to increase the number of insured and improve the risk pool; state-level wrap-around risk adjustment, reinsurance and risk corridor programs; and work with state regulators to promote fair and sustainable plan pricing.
Twitter: @JELagasse