Lamar Alexander Keeps the Individual Health Rescue Fight Alive

Sen. Lamar Alexander today shook off predictions of doom for his effort to save the U.S. individual major medical insurance market and unveiled the text of the rescue bill on the floor of the Senate.

The Tennessee Republican said his fellow Republicans should support the proposal, the Bipartisan Health Care Stabilization Act of 2017 bill, to stabilize a market that provides health coverage for about 18 million people.

If many counties end up lacking any private individual major medical coverage options at all in 2018, "government-sponsored insurance is not far behind," Alexander warned.

Alexander questioned the idea that letting the market fall to pieces, to force Democrats to agree to broader changes to the Affordable Care Act, is a conservative strategy.

"What's conservative about creating chaos?" Alexander asked.

Alexander, the chairman of the Senate Health, Education, Labor and Pensions Committee, spent months developing the 26-page bill together with Sen. Patty Murray, D-Wash, the highest-ranking Democrat on the committee.

Alexander and Murray posted a copy of the text on the Senate HELP website, to give members something to look at while Congress.gov, the official congressional legislative website, is still processing the bill.

A copy of the full text is available here.

A copy of the summary is available here.

For a look at three things agents and brokers might want to know about the bill, read on.

Bipartisan Health Care Stabilization Act (BHCSA) Provisions

Section 3 of the BHCSA bill would provide an appropriation for "such sums as may be necessary" to fund the Affordable Care Act cost-sharing reduction program for the rest of 2017, all of 2018, and all of 2019.

The subsidy program has been providing billions of dollars of year to help insurers reduce what low-income Affordable Care Act public exchange plan users must spend on deductibles, co-payments and coinsurance amounts.

Sen. Patty Murray, D-Wash. (Photo: Murray)

Sen. Patty Murray, D-Wash. (Photo: Murray)

Republicans question whether the federal government has ever had a valid appropriation to make the subsidy payments.

Under former President Barack Obama, the government said a permanent Affordable Care Act appropriation for the Affordable Care Act advance premium tax credit subsidy also applies to the cost-sharing reduction subsidy, because both subsidies are two parts of the same program.

Under President Donald Trump, federal officials have stated that they believe they have no legal basis to continue making the payments. They appear to have withheld cost-sharing reduction subsidy program payments that exchange plan issuers expected to receive Wednesday.

The BHCSA bill would require insurers to show that they had used the cost-sharing reduction subsidy money to benefit enrollees, rather than to increase their profits.

In addition to providing an appropriation for the cost-sharing reduction subsidy program, the bill would:

Speed up the approval process for states that apply to adjust Affordable Care Act program rules through the Affordable Care Act Section 1332 waiver process.
Let states come up with new ways to use existing federal payment streams to funding Section 1332 waiver programs. A state could, for example, use some of its premium tax credit money to pay for a catastrophic reinsuance program.
Require states to make sure that any waiver program changes allow people with serious health problems to get major medical coverage "of comparable affordability" to what they could get without the changes. Existing federal rules require a state to show that, for people with health problems, waiver program coverage would be "at least as affordable as" no-waiver coverage.
Let all people buy copper level coverage, or coverage that pays only 50% of the actuarial value of core "essential health benefits" package before enrollees reach the annual out-of-pocket spending maximum. Today, most consumers over 30 must buy coverage that pays at least about 60% of the actuarial value of the essential health benefits package.
Require the U.S. Department of Health and Human Services to implement an existing section of the Affordable Care Act, Section 1333, which will let states join together to form interstate health insurance product filing compacts.

Support in the Senate

Republicans hold 52 seats in the Senate. One question for Alexander and Murray is whether, if all Democrats and independents in the Senate support an individual health market rescue bill, they could attract enough Republican votes to produce the 60 votes needed to pass an ordinary, bipartisan bill in the Senate.

Alexander said that, in addition to himself, 11 other Republicans, and 11 Democrats, have already signed on as cosponsors.

The Republican cosponsors are Mike Rounds of South Dakota, Lindsey Graham of South Carolina, John McCain of Arizona, Bill Cassidy of Louisiana, Susan Collins of Maine, Joni Ernst of Iowa, Lisa Murkowski of Alaska, Charles Grassley of Iowa, Johnny Isakson of Georgia, Richard Burr of North Carolina, and Bob Corker of Tennessee.

The cosponsor list includes the two lead sponsors of the Graham-Cassidy-Heller-Johnson bill. That bill, which nearly reached the Senate floor in late September and appeared to have strong support from President Donald Trump.

Trump expressed support for the Alexander-Murray efforts to shore up the individual health market Tuesday, then said Wednesday, in a tweet, that he has concerns that continuing funding for the cost-sharing reduction subsidy program would create a bailout for health insurers.

Cassidy has said in a statement that he believes creating a short-term subsidy fix could help set the stage for replacing the Affordable Care Act with the state block grants provided by the Graham-Cassidy-Heller-Johnson bill.

Graham has said that he told Trump that the country would need something like the temporary subsidy continuation provision in the BHCSA bill even if the Graham-Cassidy-Heller-Johnson bill had passed, because the changes included in the Graham-Cassidy bill would have taken two to three years to take effect.

Arguments for the House

Graham and Sen. Ron Johnson, R-Wis., another lead sponsor of the Graham-Cassidy-Johnson-Heller bill, have said that the real challenge for the BHCSA bill will be getting the bill to the floor in the House.

Alexander said he thinks House members should welcome the BHCSA bill.

House members have already approved an Affordable Care Act change bill, H.R. 1628, that would continue funding for the cost-sharing reduction subsidy program for two years, Alexander said.

Senate Republicans have already been trying to get the main provisions in the BHCSA bill into their Affordable Care Act change bills, Alexander said.

"Our bill would have been part of the Senate Republican repeal and replace bill if budget rules had allowed it," Alexander said.

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