State insurance market volatile

Measure could require health coverage

— Washington state’s health insurance market is increasingly volatile. While the number of people without insurance has decreased every year since 2013, monthly premium rates have spiked and only one insurer is available in some counties, according to state officials.

Prospects for consumers don’t look better in the coming months. According to data from the state Office of the Insurance Commissioner, premiums are slated to increase in 2018 by roughly 34 percent, up from a 14 percent hike in 2017 and negligible changes in 2016 and 2015.

And last summer, two health insurance companies pulled out of Washington’s individual market entirely. Grays Harbor and Klickitat counties were briefly without any insurers. This year, nine counties have only one provider, according to Insurance Commissioner Mike Kreidler.

That’s why, at a Senate Healthcare and Wellness Committee meeting in early January, Kreidler voiced serious concerns about the future of the local insurance market. “It is clear that 2019 has a distinct potential of being worse,” he said at the hearing.

In response, state lawmakers have pushed several pieces of legislation that aim to stabilize the local market. Chair of the Senate Health Care and Wellness Committee, Sen. Annette Cleveland, D–Vancouver, has two bills that would create a reinsurance program for local healthcare providers with high-cost customers and institute a mandate that local residents get health insurance.

Kreidler and other local officials have largely blamed turbulence and healthcare policy change at the federal level for last year’s price increases, insurer withdrawals, as well their grim prediction for next year.

“We were relatively stable before this year,” said Pam MacEwan, Washington State Health Benefit Exchange CEO at the January hearing. “The uncertainty of this past year has created a lot of volatility.”

Last spring, the Republican-controlled legislative branch of the federal government unsuccessfully attempted to repeal former President Barack Obama’s signature healthcare reform legislation, the Affordable Care Act.

In December, as part of a Republican-led overhaul of the federal tax system, the individual mandate—a key portion of the Affordable Care Act which requires that people obtain health insurance or be financially penalized—was repealed. Additionally, in October last year, the Trump administration announced that it was ending payments for cost-sharing reductions—a federal subsidy introduced by the Affordable Care Act that lowered the cost of co-pays, deductibles, and lab tests for people who were eligible.

The individual mandate was a contentious portion of the Affordable Care Act. Proponents argued that it incentivized healthier people to buy health insurance by fining them if they didn’t get covered in order to subsidize the high cost of insuring sicker people. The law, for example, requires that people with preexisting conditions be covered. Critics of the individual mandate, however, argued that it was coercive government overreach.

“This year we have some certainty of the mandate going away, we know the cost-sharing reduction funding is gone,” Office of the Insurance Commissioner spokeswoman Stephanie Marquis said, adding higher health care costs in rural counties have contributed to insurance companies’ withdrawal.

The first of Sen. Cleveland’s bills, Senate Bill 6084, would establish a state-level individual mandate to replace the now-repealed the federal version.

The legislation exempts certain demographics, such as members of American Indian tribes and illegal aliens.

However, the bill lacks an enforcement mechanism — unlike the now-defunct federal version which levied financial penalties on people who didn’t get health insurance — prompting concerns from the Office of the Insurance Commissioner and healthcare providers.

To compensate, legislation would also set up a task-force to study potential enforcement mechanisms.

The second bill, Senate Bill 6062 requested by Kreidler, would institute a state reinsurance program for healthcare providers who cover high-cost patients.

The legislation would take advantage of federal waivers established through the Affordable Care Act.

“I’m just trying to make sure that we don’t have a market collapse in 2019,” said Kreidler at the committee hearing in reference to his requested bill.



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