An estimated 29,000 Washingtonians purchasing individual health plans will have to choose between one or two insurers within the state healthcare exchange for 2017, according to a report released last month by the Kaiser Family Foundation. Nationally, nearly a third of counties will only have one insurer option in the state marketplaces set up under the U.S. Affordable Care Act (ACA).
Americans not getting coverage through their employer might buy plans outside of the exchange, but many lower-income individuals are forced into the shrinking ACA marketplaces to qualify for federal subsidies.
Although more Washington residents have healthcare, high insurer expenses are making it difficult for companies to compete within Washington Healthplanfinder, the state’s exchange. This is especially true of rural counties within the state.
The ACA was designed to rely on competition keeping healthcare costs low and coverage affordable. Yet now, many areas of the country will essentially have marketplace monopolies with no competition at all.
For Washington state, Clallam, Grays Harbor, Klickitat, Garfield and Asotin Counties are projected to have just one insurer each within the state exchange for 2017. Every one of those counties had two options last year. Counties anticipated to have only two insurers for next year include Whatcom, Okanogan, San Juan, Island, Jefferson, Pacific, Wahkiakum, Cowlitz and Skamania counties.
Stark: Put Patients In Charge
The national trend is probably the beginning of the “death spiral” of insurance plans within the exchanges, according to Dr. Roger Stark, Health Care Policy Analyst for the Washington Policy Center.
“Fundamentally, what needs to be done in this country is to put patients in charge rather than the government,” Stark told Lens.
Stark said this would require the repeal of the ACA, more price transparency and major insurance reform away from government mandates. Stark also suggested allowing insurance companies to sell plans across state lines.
The exchange has become “top heavy” with older, sicker individuals, Stark told Lens. The deficiency of young, healthy individuals enrolling in the state exchange drives up the cost of premiums and makes all policies more expensive.
Stark told Lens there are two ways to incentivize younger, healthy individuals to join the exchanges: lower premiums and increase the tax penalty for not having health insurance.
“Outreach efforts and enrollment of younger individuals into the Exchange need to be as effective as possible,” said Sydney Smith Zvara, Executive Director at the Association of Washington Healthcare Plans. “Exchange enrollees should be encouraged to remain covered and not come in and out of the exchange based on medical need,” she added.
Better Coverage Requires Cost Controls
Zvara told Lens that needed ACA fixes include more comprehensive policy coverage than what was previously sold in the individual market. However, that in turn requires greater cost controls, she said.
“Affordability of premiums and sustainability of coverage over the long term will require addressing the underlying healthcare cost growth factors, including the dramatic rise in prescription drug pricing,” said Zvara.
There are a number of factors underlying high drug prices including expensive research, long development periods and limited competition.
Simplify The Government Role
Chris Free, Principal for Rapports Benefits Group, an employee benefits consulting firm in Tacoma, told Lens that the country took a “problematic approach” creating separate markets for exchange and non-exchange healthcare plans when a marketplace already existed.
“It would be much better off to allow people to take a subsidy or tax credit to the healthcare marketplace as a whole, just like people can go to grocery store with an EBT card to pay for groceries at any grocery store,” said Free.
Worries Grow About ‘Two-Tiered’ Healthcare System
In the Hoover Institution’s “Blueprint for America” healthcare chapter, Dr. Scott W. Atlas wrote, “further implementation of the ACA will undoubtedly accelerate the development of a two-tiered healthcare system…and reverse the superior access and outstanding quality of care that distinguish American healthcare from the centralized systems that are failing the world over,” wrote Atlas.
Atlas suggested a six-part ACA reform:
- Expand affordable private insurance by reducing overbearing insurance regulations;
- Expand Health Savings Accounts (HSAs) to all Americans;
- Reform and eliminate the ACA excise tax;
- Empower seniors to seek and receive Medicare;
- Move away from traditional Medicaid coverage to affordable private insurance;
- Encourage private sector clinic care by removing onerous documentation or credential requirements for nurse practitioners and physician assistants.
“Paradoxically, as our nation is doubling down on government authority over healthcare, those countries with the longest experience of nationalized healthcare, from Britain to Denmark to Sweden, are shifting patients toward private healthcare to remedy their failed systems,” said Atlas.
State Rep. Steve Tharinger (D-24) is member of the House Health Care and Wellness Committee and represents two of the counties which are projected to have just one Exchange insurer next year, Clallam and Grays Harbor County.
He told Lens that a single-payer government option, like what President Obama’s proposed last month, would result in Medicare and private sector savings and help negotiate better pharmaceutical costs.
Accenting a different approach, The American Enterprise Institute (AEI) released in December an agenda for reforming healthcare which involves replacing the ACA with a “genuine, consumer driven” approach.
“The ACA moved power and authority over the direction of U.S. healthcare from consumers, employers, and the states to the federal government. A replacement plan must be built on a more decentralized approach, with consumers given the ability to make choices for themselves and authority returned to the states to oversee healthcare markets,” wrote the authors.
In Washington state, House Bill 1321 and Senate Bill 5305 were both reintroduced this past session. The two companion bills would have formalized the legislature’s intent to ensure all Washington residents have access to affordable and inclusive health care by 2020. Both measures stalled in their respective chambers.