With the Affordable Care Act entering the home stretch of implementation, U.S. Senators are still trying to understand the costs and benefits of insurance market reforms, while diagnosing problems in the greater healthcare system.
On Thursday, the Senate Committee on Health, Education, Labor and Pensions convened for the eighth round of hearings on the ACA's impact, getting an update from the Center for Consumer Information and Insurance Oversight (CCIIO) and hearing a 36-year-old breast cancer patient's story of private coverage denials, hospital requirements for upfront payments and bureaucratic wrangling with state assistance programs.
In part, the hearing was a rehashing of years of debate before and since the ACA's passage, with committee chairman Tom Harkin, an Iowa Democrat, saying in opening comments that the law is curbing "the most notorious and abusive practices of the insurance industry."
The hearing was also a chance for Senators of both parties to question and criticize the head of the agency carrying out many of the market reforms.
CCIIO director Gary Cohen told the committee the agency is trying to "transform the insurance market," because especially for Americans covered by individual insurance plans, he said, "the system is broken."
Defending new rate review rules, the medical loss ratio and age rating, Cohen said that although premiums did increase in 2012, they did so at a slower rate than in previous years, and that the cost-curve will continue to slow with the expansion of coverage and little or no cost-sharing for preventive services.
"We're paying more than we should be because people aren't getting the kind of care that they should be," said Cohen, a long-time CMS employee and former chief counsel at the California insurance exchange. "In the past, Americans used preventive services at half the recommended rate; nearly 71 million Americans now have preventative access without cost-sharing."
On the issue of CCIIO's large task operating 33 federal insurance exchanges, which already delayed the creation of the SHOP choice and premium aggregation program, Cohen said: "I'm not going to sit here and tell you it wouldn't have been easier if everyone had embraced this from the beginning." But, he added: "I really think it is going to be of little to no consequence what type of exchange [consumers] are seeing."
Cohen received mostly praise from Democrats, although Harkin chided him for the fact that $54 million in federal exchange navigator grants is being sourced from HHS's prevention and wellness fund.
Republicans, meanwhile, focused on the impacts of rising premiums, the insurance and medical device taxes and the regulatory pipeline, bringing into the committee room the seven-foot-tall "red tape tower" of 20,000-plus pages of ACA guidance, proposals and rules, as assembled by Senate Republicans.
But Lamar Alexander, a Republican from Tennessee and the state's former governor, wanted to know about a problem both Democrats and Republicans have been worried about -- "churn" among people whose fluctuating incomes could send them back and forth between Medicaid and subsidized private insurance.
Would "people who you might call the working poor," Alexander asked, be able to get more stable coverage through what's come to be know as the Arkansas Option, with Medicaid-eligible residents being given subsidies to buy insurance through an exchange?
"We've tried to be as flexible as possible, to give states the ability to try different approaches," Cohen said, noting that "cost equivalency is a significant issue," and that Tennessee's Governor has been in talks with HHS about pursuing a Medicaid-through-HIX policy.
After Cohen's appearance, Kevin Counihan, CEO of Connecticut's HIX, Access CT, offered his thoughts to the committee on the impact of the ACA, along with Georgetown Health Policy Institute director Sabrina Corlette, Oliver Wyman actuary Chris Carlson and Stacy Cook, an Iowa resident and breast cancer patient.
The ACA's reforms do come at a cost to consumers and insurers, "but with fixes," said Counihan, a former Cigna regional VP and chief marketing officer at the Massachusetts Connector.
Risk adjustment and reinsurance programs should help insurers that see reductions in profits or underwriting losses, he said. Those, along with the individual mandate and federal premium support, represent "the hallmark of health reform" -- shared responsibility, he said.
That's something many American consumers have been expecting from their health plans for a while, said Georgetown professor Sabrina Corlette.
"It's not surprising that 58 million Americans live in families with medical debt and that 75 percent of them have health insurance," Corlette said. "The current market does not work for the people who need it most."