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Stabilizing Individual Health Insurance

Posted on August 30th, 2017

In September, Senators will return to Washington D.C. from their August recess. Almost immediately, they’ll begin taking up health care (again), but this time Democrats and Republicans will jointly consider changes. 
 
The Senate Health, Education, Labor and Pensions Committee has scheduled hearings to take place on September 6th and 7th. The primary purpose is to discuss ways to shore up the individual market, where double-digit premium increases in combination with fewer plan options have become the norm. Governors and state insurance commissioners, along with members of Congress, are expected to participate in the hearings. The likely topics of consideration are expected to include:
 
  • Guaranteeing funds for the cost-sharing reduction subsidies.
  • Ensuring the Individual Mandate is enforced, or devising a new way to incentivize uninsured Americans to obtain coverage.
  • Providing additional funds to insurance companies who experience higher than expected claims.
  • Reauthorizing the Children’s Health Insurance Program (CHIP), where funding is currently set to expire on September 30th. 
 
Whatever happens, if anything, is likely to be small in nature compared to the repeal and replace efforts that were undertaken earlier this year. However, the underlying question is whether Democrats and Republicans can come up with some kind of mutually agreeable compromise.
 
Republican leaders have concerns about financing these health care programs without any type of fundamental reform included. As a result, it’s likely Republicans will try to negotiate some of their agenda items into any health care bill that is taken into consideration. 
 
It appears one of the items that could be put on the table is the expansion or enhancement of Health Savings Accounts (HSAs). This was an item included in previous House and Senate repeal bills, and there isn’t a lot of controversy surrounding this provision, although some Democrats are concerned that increasing HSA contribution limits will primarily benefit the wealthy. 
 
Another area for compromise may be with the Employer Mandate. This largely unpopular provision has been criticized by unions and labor organizations who have been long-time supporters of the Democratic party. Republicans also attempted to zero-out the penalties associated with the Employer Mandate with their previously proposed repeal and replace bills. Some have suggested a compromise could include redefining an applicable large employer as being one with 500 or more employees and redefining a full-time employee as one who works 40 hours per week. 
 
There’s not much time for Congress to take action, so if anything happens, it’s likely to happen quickly.