Early retirees, farmers and others who are self-employed will likely pay more for health insurance next year due to reckless action and inaction in the past three months by the Trump administration and Republican congressional majorities. This pocketbook issue, which could have been fixed or avoided, ought to be a top issue as voters consider whom to support in the 2018 election.
The traditional fall release of the coming year’s insurance costs for those who buy on the individual market — meaning they don’t get coverage through a job or public program — will put a powerful spotlight on health care in the midterm election’s waning weeks. The window of time to buy 2019 coverage is expected to begin in November.
But a new report from the respected Urban Institute has provided an early, alarming look at 2019 insurance premium costs. Their analysis is timely because it considers the impact of a recent run of ill-informed decisionmaking and leadership:
• The congressional move in early December to effectively repeal the mandate to buy health insurance.
• The Trump administration’s recent push to expand sales of skimpy, short-term health insurance policies.
The report reasonably concludes that these three developments will weaken, rather than strengthen the fragile individual market, which serves about 7 percent of Americans. The result: higher health insurance premiums for comprehensive health insurance policies and in turn, fewer people covered. Regrettably, Congress failed last week to pass an Affordable Care Act (ACA) stabilization bill — one championed by two Republican senators — that could have mitigated this harmful impact.
Premiums are projected to rise 18.3 percent on average in the 45 states (including Minnesota) that “do not prohibit or limit short-term plans.” Unfortunately, the Midwest faces the steepest hikes of any region. North and South Dakota can expect 21 percent premium increases. Wisconsin, get ready for 20 percent hikes. Iowa can expect a 16 percent jump.
Minnesota is in a somewhat better spot because last year its Legislature passed the same type of protective measure — “reinsurance” — that was in the failed initiative pushed by Sens. Susan Collins, R-Maine, and Lamar Alexander, R-Tenn. The state faces an 11 percent increase but must also deal with a different setback. The Collins-Alexander effort included a remedy for the funding shortfall the Trump administration inflicted last fall on the MinnesotaCare program.
The Minnesota Legislature’s smart work on reinsurance illustrates why the poor federal decisions are so frustrating. Lawmakers here grasped the individual market’s critical flaw — it’s too small to affordably spread out the cost of enrollees who have expensive medical conditions. Reinsurance offsets the cost of these high-need patients, thus keeping others’ policies affordable. It worked in Minnesota, keeping premium costs steady or even resulting in decreases for 2018.
So why didn’t Congress follow Minnesota’s lead? Good question, especially for Republicans, who control the House, Senate and presidency. Voters also ought ask why Congress unraveled the mandate, which will further shrink individual market enrollment. Worth noting: the administration’s short-term plan push, if put in place, will exacerbate declining enrollment by enticing healthy people to buy threadbare policies, leaving those who need real insurance facing much steeper costs.
The ACA has long been inaccurately derided by Republicans as a “government takeover” of health care. In reality, one of its core strategies is providing financial assistance to help people buy private health insurance. Policies that undermine the individual market are hurting consumers and hindering competition by creating uncertainty for insurers. Incredibly, those opposed to more government involvement fail to see how they’re hastening that by making the ACA’s private insurance approach unworkable.