Uncertainty Puts PPACA Exchange Insurers in Tight Spot as Filing Deadline Looms

To stay or not to stay––that is the question

After the failure of House Republicans to overhaul the Patient Protection and Affordable Care Act (PPACA) and President Trump’s subsequent threat to let the program “explode,” more health insurers are threatening to pull out of the PPACA’s exchanges next year, while others may hike the premiums they charge, according to an article posted on the Bloomberg website. Insurers are expected to begin declaring their intentions in the next few weeks.

In Washington, Insurance Commissioner Mike Kreidler pushed back by a month the date when insurers have to say what they plan to offer. 

Much of the current uncertainty is thanks to the Trump administration, which will play a key role in deciding whether the PPACA’s markets collapse or survive, according to the article. President Trump has threatened to stop the government subsidies that support copays and other upfront costs for lower-income people. Without them, insurers would likely boost their premiums or drop out the exchanges entirely, Bloomberg says. The administration hasn’t revealed whether it will keep the payments going.

Insurers contacted by Bloomberg––including Anthem, Cigna, Aetna, and Health Care Service Corp., which offers plans under the Blue Cross Blue Shield brand in five states––declined to commit to selling PPACA plans next year.

Health insurers see April 30 as a key deadline for a decision on the cost-sharing payments. They’ll start filing with state regulators in May to say whether they plan to stay in the markets.

The insurance industry praised a set of rules released by the Trump administration on April 13 that were designed to make the PPACA exchanges more profitable for insurers. Those rules won’t mean much, however, if government funds are cut off, the Bloomberg article points out. Without the cost-sharing subsidies, insurers will have to boost premiums by 19% on average to make up the shortfall, according to a recent analysis by the Kaiser Family Foundation.

Source: Bloomberg; April 17, 2017.