Many families are searching for options in the individual insurance markets. This year we are seeing more non-traditional options added to the mix. This article describes how the US Government may start allowing subsidies on nontraditional plans. The saying “buyer beware” applies in healthcare. If a plan seems very inexpensive or too good to be true, look at the details and ensure there are valid networks and adequate coverage if you have a serious or costly health issue. With deductibles and coinsurance rising so high for most families, small procedures are usually paid out of pocket. So make sure your insurance is there for the large and catastrophic issues to ensure you can afford to get care.
States Are Cleared to Allow Less-Comprehensive Health Plans
Trump administration would let federal subsidies cover plans that don’t meet ACA rules
By WSJ Michelle Hackman
WASHINGTON—States will be allowed to offer less-comprehensive health plans yet still qualify for federal subsidies under a new Trump administration policy that will let them skirt key regulations under the Affordable Care Act.
The change, announced by the Department of Health and Human Services on Monday, marks a fundamental shift in how the federal government enforces the states’ administration of the ACA, accelerating a trend in which red and blue states can craft significantly different health-care policies under the same federal law.
Under the guidelines, the administration will consider state ACA waiver requests that would allow federal subsidies to cover skimpier, less-expensive plans that don’t meet the law’s requirements. Such plans can be cheaper for consumers and might be preferable for younger and healthier Americans, but many health-care analysts say they could end up siphoning healthy customers out of the ACA market, resulting in higher premiums for older people and others with pre-existing medical conditions who need fuller plans.
Seema Verma, who heads the Centers for Medicare and Medicaid Services, which oversees the ACA, described the move as a major step in lowering health-care prices.
“Premiums are still much too high, and choice is still too limited,” she said in a statement. “This is a new day—this is a new approach to empower states to provide relief.”
Democrats said the move contradicted Republicans’ claims that they want to protect people with pre-existing medical conditions from high premiums.
“The American people should look at what Republicans are doing, rather than what they’re saying, when it comes to health care,” said Senate Minority Leader Chuck Schumer (D., N.Y.). “Just weeks before the election, Republicans are once again undermining protections for people with pre-existing conditions and sabotaging our health-care system.”
The Obama administration also allowed states to submit proposals to waive ACA requirements, but with far more limitations.
Obama officials required that under any waivers, individuals still must have health plans that were at least as expansive and affordable as those required by the health law. The current administration will instead require that those plans simply be available, along with the less-regulated options.
Since Republicans in Congress failed last year to repeal the ACA, the Trump administration has steadily pursued policies giving individual states the option of weakening the law’s provisions.
The administration has moved, for example, to permit the sale of short-term health policies and let businesses and some individuals band together in “associations” to obtain plans that don’t comply with the ACA. Congress last year also successfully repealed the ACA’s requirement that individuals purchase health care or pay a penalty. That repeal will take effect in 2019.
“This was the plan from the start,” said Larry Levitt, a senior vice president at the Kaiser Family Foundation, a nonpartisan health-policy think tank. “If the ACA couldn’t be repealed outright, then the next best thing is to let states do it one by one.”
The latest guidelines respond to requests from conservative-leaning states whose leaders have expressed interest in rolling back ACA rules they say inflate consumers’ health costs, such as a requirement that all insurance plans cover certain benefits.
Iowa and Oklahoma, for example, submitted plans last year that would have erased key ACA regulations. The administration rejected those proposals under the stricter Obama-era guidelines.
The administration in the new guidelines encouraged states to bolster “private” insurance plans, suggesting it might not approve state plans that propose putting federal ACA money toward systems that use more government funding.
Some Democratic-leaning states have signaled an interest in adopting such systems. Gavin Newsom, a Democratic candidate for California governor, has vowed to move toward such an arrangement should he be elected in November.
Separately, the administration will propose a new rule on Tuesday allowing employers to allot their workers money to purchase health plans on the individual market, according to a senior administration official. The Obama administration had prohibited employers from doing so, in part fearing that employers would push only their older and sicker employees onto the individual market, where consumers buy insurance on their own.
Under the new rule, employers wouldn’t be able to choose which workers to offer money rather than an employer-sponsored health plan, limiting the possibility that business owners would take advantage of the new rules to direct only their most expensive workers to the individual market, the official said.
Write to Michelle Hackman at Michelle.Hackman@wsj.com