The next phase of health care reform

The health insurance industry is constantly changing. While this is nothing new for health plans like Priority Health, the debate around health care reform over the last several months makes it difficult for our members and businesses alike to navigate the proposed changes, and to know how they may impact health care benefits.

As Congressional leaders continue to pursue fixes to our nation's health care system, Priority Health is keeping a pulse on the developments happening in government, and we've boiled down the hot health reform topics you should have on your radar.

Cost-sharing reductions

Cost-sharing reduction payments, or CSRs, help make health care more affordable and accessible for low- and moderate-income individuals and families. In Michigan, around 165,000 residents – more than half of exchange enrollees in the state – qualified for CSR subsidies last year to help reduce deductibles, copayments and other out-of-pocket charges.

Under the Affordable Care Act (ACA), the federal government reimburses insurance companies for reducing deductibles and other out-of-pocket costs for low income individuals and families. While CSRs provide real value and savings for consumers, the health plan simply acts as an administrator of CSR payments.

The federal health care law does not explicitly link the subsidies associated with CSRs to a permanent funding source. As a result, the authority for government funding of the CSR payments is currently the subject of a lawsuit between the U.S. House of Representatives and the U.S. Department of Health and Human Services (HHS).

Without CSR payments, basic premiums would increase 20% next year and federal budget deficits would increase by $194 billion over the next decade, according to the non-partisan Congressional Budget Office.

Bipartisan efforts

Lawmakers in the U.S. Senate are trying to come together for bipartisan solutions aimed at stabilizing and strengthening the individual health insurance market. In addition to providing mandatory funding for CSR payments, lawmakers are also considering proposals to:

  • Create a dedicated fund to help states reduce premiums and limit losses for providing coverage, especially for individuals with pre-existing conditions
  • Provide flexibility for states to innovate and experiment with different ways to pay for and deliver health care

As changes to our health care system make their way through the legislative process, Priority Health will keep you up-to-date. Visit ThinkHealth for articles on health care reform and the Priority Health website for the latest changes in Congress.