ACA individual health market can stabilize, officials say

Mike Kreidler, the Washington state insurance commissioner, today told Congress that the Affordable Care Act individual health insurance market system is working well in his jurisidction.

"It has had a profoundly positive impact on the state of Washington," Kreidler testified today at a hearing on state health insurance markets organized by the Senate Committee on Homeland Security and Governmental Affairs that was streamed live on the Web.

Congressional committees that organize hearings usually have members from the majority party pick most of the witnesses and members of the minority party pick the rest.

Republicans brought in Mary Taylor, the Ohio insurance commissioner; J.P. Wieske, Wisconsin's deputy insurance commissioner; and Nick Gerhart, Iowa's insurance commissioner.

None of those three states has tried to set up a state-based health insurance exchange, and Iowa is the only one of the three that has taken ACA Medicaid expansion.

Washington state has set up a state-based exchange and taken Medicaid expansion money.

Iowa and Ohio are home to Consumer Operated and Oriented Plan carriers that have already failed. Ohio and Washington state are home to CO-OPs that are still in business but are struggling.

Gerhart said Iowa now has more Medicaid enrollees than it did in 2013, before the major ACA individual health insurance market changes and programs came to life, but fewer purchasers of commercial coverage.

"Significant debate remains about whether improved access could have been achieved through much more efficient market mechanisms," Gerhart testified.

Gerhart, Taylor and Wieske said consumers are paying more in their states and getting fewer coverage choices.

Kreidler insisted that the effects of the ACA on stays that did their best to implement at it have been good for the residents of states like his.

Mike Kreidler, Washington state's insurance commissioner, testified that the Affordable Care Act has helped lead to a sharp drop in uncompensated care. (Image: Thinkstock)

Defending the ACA

In 2013, Washington state had 11 issuers of individual health coverage. "None of them covered maternity or covered prescription drugs," Kreidler said.

Double-digit rate increases were common, 14 percent of the state's 7 million residents were uninsured, and health care providers delivered 2.3 billion in uncompensated care per year, he said.

This year, the ACA coverage expansion programs has helped cut the uninsured rate to 7.3 percent and the amount of uncompensated care provided to about $1.2 billion, Kreidler said.

The state now has 13 individual health coverage issuers.

The issuers have applied to increase rates 13 percent in 2017, but that's not surprising, given how much insurers have now learned about how the ACA works, he said.

Another ACA defender, Andy Slavitt, acting director of the Centers for Medicare & Medicaid Services, testified at another hearing, which was organized by the House Energy & Commerce oversight subcommittee, that he believes the individual health market will stabilize in 2018.

Rates will rise sharply in 2017 mainly because of the end of the ACA reinsurance program, which helped individual coverage issuers against catastrophic claims, and because 2017 is the first year in which insurers have had substantial amounts of information about ACA plan enrollees to use when setting rates, Slavitt testified.

"The good news is that medical cost trends throughout the country are very low," Slavitt said.

Because the main drivers of the 2017 rate increases are one-time events, and the underlying cost of medical care is increasing at a moderate rate, rates should stabilize in 2018, Slavitt said.

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