America’s Health Insurance Plans is urging Centers for Medicare and Medicaid Services Administrator Seema Verma to prevent subsidies from being used to purchase plans that are not compliant with the Affordable Care Act.
In a December 20 letter to Verma, AHIP said CMS’s October proposal to offer new flexibility through ACA waivers would destabilize the market.
CMS is proposing for states to apply for waivers to let them to use pass-through funding for subsidies that until now, have helped individuals purchase ACA plans. The funding would be able to be applied for subsidies for other types of insurance, such as short-term, limited duration plans.
The agency is preparing to release a series of waiver concepts that have more specifics. The new policy is currently in effect, but is expected to impact states in 2019 for the 2020 plan year.
WHY THIS MATTERS
Due to adverse selection, the expansion and promotion of coverage products that are not comprehensive or that charge more or deny coverage for pre-existing conditions could lead to a reduction in the number of comprehensive options over time, AHIP said. This would ultimately reduce the number of coverage options that provide real protection from financial devastation due to an injury or illness.
CMS has said it would keep in place policies to protect consumers who have preexisting conditions.
AHIP wants CMS to reissue the guidance through formal rulemaking.
THE TREND
Under the Trump Administration, CMS has been open to more options for individual coverage that it says makes plans more affordable. The administration has expanded the duration of short-term plans from three months to a year.
Insurers have said healthy consumers would leave the ACA market for less expensive coverage, leaving sicker and costlier individuals in Obamacare.
ON THE RECORD
“CMS should not approve a waiver that would be reasonably expected to reduce access to comprehensive coverage,” AHIP said.
Twitter: @SusanJMorse
Email the writer: susan.morse@himssmedia.com