Insurers to GOP: Here's what to do after Obamacare repeal

Tom Price in 75 seconds
Tom Price in 75 seconds

Repealing Obamacare could throw the health care industry and the millions of Americans relying on the individual market into a tizzy, top industry lobbying groups warn.

So insurers and other industry players are making sure lawmakers know exactly what they want in order to continue playing ball -- and what's at stake if Congress doesn't listen.

After staying relatively quiet in the weeks following Donald Trump's election, health care lobbyists are now publicly rolling out their recommendations for the repeal and replacement of Obamacare. Associations representing insurers, hospitals and actuaries all laid out proposals for keeping health care affordable in a post-Obamacare world.

And, perhaps even more critical, they are warning what could happen if things aren't done right.

"Those changes can either bring a stable transition to a better approach, or they can bring about even more uncertainty and instability," America's Health Insurance Plans, which represents insurers, said in a statement.

Related: Obamacare chaos: Insurers may flee before new plan is put in place

AHIP released five pages of talking points on what insurers want in order to stay in the individual market exchanges in 2017 and 2018, while lawmakers hammer out an Obamacare replacement plan. It also lays out what the industry wants for 2019 and beyond, as well as its priorities for Medicaid and Medicare.

Some issues have been on insurers' list before. Facing sicker-than-expected customers and millions of dollars in losses in the Obamacare exchanges, insurers want lawmakers to continue and expand risk payments that offset the cost of caring for ill enrollees. They'd also like to make it harder for Americans to sign up for coverage outside of open enrollment periods to prevent people from seeking coverage only when they get sick. And they want to prevent providers and other groups from steering patients into the individual market when they could qualify for Medicaid.

They also support the federal government providing tax credits to help low-income Americans afford coverage, however they note that they must be large enough to entice people to sign up. And while insurers are not opposed to high-risk pools -- which Republicans favor as a way to insure those with pre-existing conditions who let their coverage lapse -- they say they must be structured differently that the ones that existed before Obamacare. Those lacked proper funding and often had waiting lists to sign up for coverage.

Related: Who would lose coverage under Obamacare repeal? Trump supporters

The industry is also warning that it needs time to react to a rewriting of the law. Under current rules, insurers must submit initial rates to state regulators in May for their 2018 Obamacare policies. They'd like to shift that deadline to the summer.

"Uncertainty in early 2017 may discourage plans from submitting bids for 2018 -- which could mean most people have no pathway to purchase the coverage they need," AHIP said.

Many insurers were already questioning their continued participation on the Obamacare exchanges, and several large players scaled back dramatically for 2017.

Insurers also insist that lawmakers continue providing cost-sharing subsidies for lower-income enrollees. The House of Representatives had filed a lawsuit against the Obama administration in 2014, saying Congress did not approve funds for those subsidies and the White House overstepped by providing them. A district court judge sided with the House last May, but an appeals court has put the case on hold until after President-elect Trump's inauguration. Ending those subsidies could prompt insurers to swiftly discontinue coverage.

Separately, the American Academy of Actuaries, which helps insurers analyze risk and set premiums, highlighted the importance of maintaining the cost-sharing subsidies that help millions of people afford medical care. In a letter to House Speaker Paul Ryan and Minority Leader Nancy Pelosi, the academy warned lawmakers that repealing Obamacare without simultaneously approving a replacement plan could rock the individual market and leave millions of Americans at risk of losing their coverage.

Related: How Trump's health secretary pick would replace Obamacare

The academy emphasized the importance of provisions such as the individual mandate, premium assistance and cost-sharing subsidies to attract young and healthy enrollees. These folks are critical to the stability of the individual market because they offset those with pre-existing conditions, which Republicans have promised to protect.

Two major hospital associations, meanwhile, warned the Trump administration and Congressional leaders that repealing Obamacare could cost its members hundreds of billions of dollars. The associations sent two reports detailing the potential strain on hospitals, which may have to absorb the costs of caring for millions of newly uninsured Americans. The repeal bill that Congress passed last year, which President Obama vetoed, did not restore the funding cuts for Medicare and Medicaid hospital services for patient care, they noted.

Obamacare reduced federal funding for hospitals to cover the uninsured since the health reform law -- particularly Medicaid expansion -- was supposed to reduce the number of Americans without coverage. However, only 31 states and the District of Columbia have expanded Medicaid.

"Losses of this magnitude cannot be sustained and will adversely impact patients' access to care, decimate hospitals' and health systems' ability to provide services, weaken local economies that hospitals help sustain and grow, and result in massive job losses," the letter read, noting that hospitals are often the largest employer in communities.

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