Health Insurance Markets During a Time Of Change: The Nuts & Bolts

February 1, 2017

A repeal and replacement of the Affordable Care Act is on the agenda for Congress in 2017, and while Americans remain divided on which policy proposals they favor, there is shared concern about rising premiums and deductibles for those covered by private insurance.

This webinar presented an overview of the individual and employer-based insurance markets before and after the ACA, and it looked ahead at the choices both insurers and consumers must make for 2018 and beyond. Our panelists discussed the factors affecting insurer participation in the next marketplace open enrollment, and the possible impact of proposals like high-risk pools, new tax credits and changes to the tax treatment of employee benefits. We also discussed how much latitude states will have to put forth their own proposals to increase coverage and access, plus key considerations for journalists covering news developments at the federal, state and local level.

Linda Blumberg
Senior fellow
The Urban Institute

Christopher Holt
Director of health care policy
The American Action Forum

Brian Webb
Assistant director, health policy and legislation
National Association of Insurance Commissioners

Mary Agnes Carey
Senior correspondent
Kaiser Health News

Mark Zdechlik
Minnesota Public Radio

Karl Eisenhower
Communications director
Alliance for Health Reform

This webinar is a project of the Alliance for Health Reform and the National Institute for Health Care Management (NIHCM) Foundation, in collaboration with the Association of Health Care Journalists.


Health Insurance Markets During a Time Of Change:
The Nuts & Bolts
Wednesday, February 1, 2017

1:30 – 1:35 p.m. Welcome and Introductions

1:35 – 2:15 p.m. Presentations

  • Linda Blumberg, @urbaninstitute
    Urban Institute
  • Christopher Holt
    American Action Forum
  • Brian Webb
    National Association of Insurance Commissioners
  • Mary Agnes Carey, @maryagnescarey
    Kaiser Health News
  • Mark Zdechlik, @markzdechlik
    Minnesota Public Radio

2:15 – 2:45 p.m. Question and Answer Session

This webinar is a project of the Alliance for Health Reform and the National Institute for Health Care Management (NIHCM) Foundation, in collaboration with the Association of Health Care Journalists

Presentation: Linda Blumberg

Presentation: Christopher Holt

Presentation: Brian Webb

Presentation: Mary Agnes Carey

Presentation: Mark Zdechlik

Event Resources

Key Materials


The Alliance makes every effort to ensure the accuracy of written transcripts, but due to the nature of transcribing recorded material, this transcript may contain errors or incomplete content. If you wish to take direct quotes from the transcript, please use the video of this briefing to confirm their accuracy.

KARL EISENHOWER: Thank you for joining us. My name is Karl Eisenhower from the Alliance for Health Reform, I’m our communications director. We’re glad you could join us. Today’s webinar is a project of the Alliance for Health Reform and the National Institute for Healthcare Management Foundation, in collaboration with the Association for Health Care Journalists.

Today we’ll be discussion health insurance markets, how they function before and after the Affordable Care Act, what we know about Republican repeal and replace plans and how reconciliation works in Congress, what’s likely to happen at the state level and key consideration for journalists covering healthcare issues in 2017.

We’ve got a great panel for you today. We’ve got Linda Blumberg who is a Senior Fellow at the Urban Institute, Christopher Holt who is Director of Healthcare Policy at the American Action Forum, Brian Webb who is Director for Healthcare, Health Policy and Legislation at the National Association for Insurance Commissioners, Mary Agnes Carey is Senior Correspondent at Kaiser Health News, and Mark Zdechlik is a reporter at Minnesota Public Radio.

So, just a little housekeeping here. You’ll notice on the top right hand of your computer screen there is a little toolbar with an orange arrow. You can use that arrow to open and close the toolbar that allows you to adjust your audio settings. We’ve got some handouts there that you can download. And we will have about half an hour in the second half of this webinar for taking your questions. You can enter your questions in the little bot that says questions and we will get those to our panelists.

In addition to the handouts in your control panel we will have all the speaker presentations and a video of this webinar posted to our website which is, so if you want to refer back to this later or send it on to your colleagues, just please come to our website. In addition, you’ll see in the bottom right, down there, there is a hashtag #allhealthlive, that’s another way you can get questions to us. You can tweet your questions with that hashtag, or if you want to do any live tweeting that’s the hashtag for this webinar.

One other thing we want to tell you about is we have just published a new edition of our source book. If that’s not something that you’re familiar with, it is a reference for the basic health policy, the current state of play of health policy issues, data on the American health system and experts and how to contact them. It’s a great resource. So if you are a long time user of the source book, it’s all been updated. We’ll be updating it throughout the year. If that’s new to you, the URL is there on your screen. Come take advantage of the reference material we have for you in the source book.

So, our first speaker is Linda Blumberg, and I’m going to hand things off to her so she can give you her presentation.

LINDA BLUMBERG: Thanks very much. Good afternoon everybody. Let’s go to the first slide after the title. So, I want to start out by giving everybody kind of a 20,000 foot perspective of the difference between the private non-group insurance market prior to implementation of the Affordable Care Act reforms compared to the situation under the Affordable Care Act. And then move after that into some details. And when I refer to non-group insurance I want to be clear that I’m talking about health insurance policies that individuals and families purchase on their own, not through an employer. And the big picture difference that I’m going to explain is also fundamental to understanding how the ACA’s reforms differ from the permanent alternatives being proposed by some members of Congress; so hopefully we’ll come back to this framework as well later.

But, prior to the Affordable Care Act’s major reforms kicking in in January 2014, the non-group market and the vast majority of states was characterized by risk segmentation. This means that people who were healthy were at financial advantage, while much larger shares of total healthcare costs fell on those who needed to use medical care. And I’ll talk in more detail shortly about how that manifested itself in practice. But, separating many more of the costs of those with healthcare needs from those without them was a defining characteristic of these markets.

In contrast, a central objective of the ACA was to spread the costs of those with healthcare needs more broadly across the population. So, risk sharing policies mean that individuals face higher costs when they are healthy. But when they have healthcare needs they’ll have more affordable access to necessary care. And risk segmentation policies link to savings when people are young and healthy, but they decrease affordability in access to care when people get sick or injured.

For example, requiring more benefits to be included in a health insurance plan means that the cost of providing those benefits to people who use them are spread across all the individuals who are insured. Excluding a benefit from a package means that anyone who needs that benefit will end up paying for the full cost of that care on their own, making it unaffordable in many cases. Placing limits on deductibles and other cost sharing requirements means that people who need to use significant amounts of care will be able to share more of those costs with all those who are insured, instead of paying out of pocket when they need care and before insurance kicks in.

So, the tradeoff is the broader the coverage, the more accessible care becomes when you need it. But the higher the premium becomes too, and that additional cost is shared by people who at any given moment might not need to use healthcare services. Assessing policy options on the continuum of risk sharing versus risk segmentation will tell you a lot about the distributional implications of various policies and proposals. And I argue that it should be a critical metric for evaluating all those types of options. So, let’s go to the next slide.

Prior to the Affordable Care Acts reforms, state laws and regulations determine the extent to which individuals of different types get access to health insurance: the premiums they would pay and the benefits that their insurance would cover. Only five states had guarantee issue of health insurance in the non-group market, and one more had guaranteed issue conditional on people having a minimum level of health status. So, the rest of the states and the District of Columbia allowed insurers to deny coverage to people outright based on their health status – either their current health circumstances or circumstances in the past. And all states, plus DC, allowed pre-existing condition exclusion periods. 41 states had limits on these exclusion periods ranging from six months to 36 months. And 10 states had no time limits on them at all. There were some federal protections for coverage of pre-existing conditions under the Health Insurance Affordability and Accountability Act of 1996. And we can talk about those later if you like. But, those protections were available only with an array of conditions; so they are much more limited than what we will talk about shortly under the ACA.

Just a couple of examples of the types of exclusions we saw in the pre-2014 days. A family applying for a policy we saw was offered a policy for all family members, except their child who had asthma. Another insurer offered that same family a policy but excluded all benefits related to their child’s respiratory system.

A man who had coronary artery disease was denied coverage outright by most insurers, but one insurer offered him a plan that excluded any care related to his circulatory system.

We even saw outright denials of coverage for things as common as hay fever, depending upon the insurer. Prior to the ACA, 32 states allowed insurers to charge higher premiums for those with health problems, with no limits. They could charge someone whatever they wanted, and as you can guess, that could be high enough to effectively be a denial for practical purposes. All of the rest of the states allowed higher charges, but with some limits. Though these were usually pretty broad, with the exceptions of New York and Massachusetts that didn’t allow higher premiums to be charged due to health status. Next slide please.

Insurers used a range of factors in addition to an applicant’s health conditions, past and present, to varying premiums based on the characteristics of the individual applying for coverage. These included variations for age. Many charged older adults five or six times what they charged younger adults. Although we used to see a lot of ranges, and I remember seeing even 11 to 1 premium rating differences occasionally. They would charge women higher premiums during child bearing years and men higher premiums during later adulthood. Some varying premiums based on the perceived riskiness of the job that they worked, some increased premiums the longer a person had health insurance. Presuming that even if you were healthy when you first enrolled, eventually, bad luck was going to strike you. So if you had been with us a long time, even if you hadn’t had a lot of cause regression to the means, suggest that before too long you’re to have some needs, and so they would charge you up as a consequence.

Insurers frequently offered individuals, based on higher risk for needing medical services, policies that had higher caution requirements – so higher deductibles or co-insurance or higher out of pocket maximums. People they estimated would be lower costs could be offered policies with lower cost sharing requirements. Next slide please.

However, enrolling of higher cost individuals, non-group insurers generally sold policies with limited benefits and high cost sharing requirements regardless. And this was as compared to what people were customarily getting through employer-sponsored insurance. The thought was if someone is looking for comprehensive coverage, they probably know something about themselves that the insurer doesn’t know, and they probably aren’t going to use substantial amounts of services; so these policies rarely covered mental health care or substance use disorder treatment. They rarely covered maternity care, but if they did, they charged more for adding it than the cost of a normal birth, presuming it would be a high cost birth. Coverage often excluded prescription drugs or covered a small number of prescriptions only, or maybe only covered generic drugs.

Also, applicants were not entitled to get insurance plan documents until they actually enrolled in a plan and unless the insurer decided to send it to them, and the documents were incredibly complicated to understand even once a consumer obtained them. So, with premiums and benefits varying with personal characteristics and the lack of a readable policy document and the requirement of submitting applications usually with a fee and going through medical underwriting to find out what kind of policy you’d be offered and at what price, doing comparison shopping across insurers was extremely difficult. This was by no means a market with price transparency, comparability or ease of accessing information about options. In other words, it was not a competitive market by any definition that economists would use. Next slide please.

Under the Affordable Care Act, rules in the non-group market changed enormously as of January 1, 2014. And I’m going to run through the major changes quickly but you can ask me questions later if you like if I’m running through them too fast. Under the Affordable Care Act, there’s guarantee issue of all products in the non-group market during annual open enrollment periods and during special enrollment periods that occur when people’s life circumstances changed, such as a move to a new location, a loss of a job, marriage, or birth. There are no pre-existing condition exclusion periods permitted. Premiums are only permitted to vary by age or the limit of 3 to 1 – meaning that a 64 year old cannot be charged more than three times that of the youngest adult for the same policy. All policies must include essential health benefits – there are 10 categories of these essential health benefits listed in the law – but there is some flexibility in terms of how states were permitted to implement these essential health benefit requirements.

All policies have to adhere to cautionary standards. They have to fall into one of four actuarial value tiers. All policies, including those in the group market, incidentally must now provide everyone with a standard summary of benefits and coverage, and these are publically available so that shoppers can see what a plan includes and excludes. It’s in reasonably simple language as insurance goes; it’s presented in a consistent format so it’s easy to compare and follow. Financial assistance is provided to lower the cost of premiums for those with incomes below 400% of the federal poverty level. And there are cost sharing subsidies to lower deductibles and other out of pocket requirements for lower income purchasers. All of these changes permit comparison shopping really for the first time in almost every state. And no one has to go through medical underwriting anymore, so you know the benefits and the coverage, you know the premium without any more complicated application process.

So, the bottom line is that the ACA provides more covered benefits with much less price variation, and that means there’s more sharing of healthcare costs across a larger population. More risk pooling, less risk segmentation, and this is the market difference from the pre Affordable Care Act era. So, I’ll stop there and can come back to this later if you like.

KARL EISENHOWER: Thank you Linda. For those who joined us in progress, I just want to reiterate that all these presentations and a video of this webinar will be posted to our website. So if you joined us late or you want to refer to this later, that will be available online. So, our next presenter is Christopher Holt from the American Action Forum; and give us a minute to switch to his presentation.

CHRISTOPHER HOLT: Thanks Karl. So I’ve been asked to talk about repeal or replace in the context of reconciliation, explain that process to you a little bit. And then essentially touch on some of what we might see as a replacement alternative from Republicans. I think just given the time limits and the complexity of reconciliation, we may not make it to those last slides. So I do want to flag two products for you all to that may be useful since I have to rush through this. They’re both available on our website, the They both have been published in the last week. One is called “Budget Reconciliation: A Primer” – it’s written by our Director of Fiscal Policy Gordon Gray. He is a former Budget Committee staffer – it could be very useful to you when you’re writing about this process. Second is called “Replacing The ACA: Reading The Replacements” by Tara Hayes, who is one of our health policy analysts. And that basically does what I’m hoping to do at the end if I get a chance. It just says seven or eight replacement proposals out there. What do they all have in common? What are the policies the Republicans seem to be circling around? So keep those in mind, if there are questions that we aren’t able to get to during the time allotted. If we can go to the next slide.

I want to start by just explaining what budget reconciliation is. It is a process that was created as part of the Congressional Budget Act of 1974, which instituted our modern budget process. And the idea was that they wanted to be able to get at legislation that would affect the deficit or reduce debt. And so, they wouldn’t be able to do that without all the complications of the filibuster. And so what reconciliation does, if both chambers – so both the House and the Senate – pass a budget, which does not always happen, they can include reconciliation instructions to specific committees to produce legislation that deals with one of or all three of these following categories. It sounds broad, but it’s not – spending revenue and the federal debt limit.

So, that legislation then when it comes back from those committees is privileged. In other words, it can’t be filibustered. You can pass with 51 votes. There’s a limited amount of debate: 20 hours in the Senate. And then if you end up going to a conference committee and conference report comes back, the debate on that conference report is limited to 10 hours. Each one of these categories – these provisions: spending revenue and federal debt limit – can only be touched once in the reconciliation process. Now we say in our slide once per year, that’s really once per fiscal year. It’s possible that we may get two sets of reconciliation instructions in this calendar year just because of the nature of how the budgets were passed. You could conceivably have three bills, one dealing with each of those categories, but more likely you would have one bill that dealt with all three. Can we go to the next slide?

The next term that you’re going to hear a lot about, that you may not be familiar with, is the Byrd Rule. And sometimes you’ll hear people talk about a Byrd Bath. The scope of reconciliation was limited to items that had a direct budgetary impact. Initially, you had some legislation come through that included provisions that violated through the rules of reconciliation. And so the Byrd Rule basically just says that any senator can raise point order against a provision in the reconciliation bill and say “Hey, this isn’t directly related to budgetary impact. And so I don’t think this can stand”. The parliamentarian will rule; the parliamentarian says that that provision doesn’t fit the rules of reconciliation. That’s what we call a Byrd Bath – the provision is struck.

There are a number of provisions here; I think you’re going to get these slides. You can go through them on your own. I want to flag in particular under provisions number four, and we’ll come back to this. Any provision must not be merely incidental to its budgetary effect. That is really important in understanding reconciliation in the context of what can and can’t be repealed for the ACA. If we can go to the next slide.

So, what can be repealed through reconciliation and what can’t? One way to maybe understand the order of magnitude here is that we did a memo, which is also on our website, looking at the 2015 reconciliation bill which was sort of a dry run for this. Republicans knew that the President would veto it and kind of wanted to practice. So in that legislation, our memo is twelve pages, and two pages are dedicated to provisions of the ACA that are repealed under that reconciliation bill, and ten pages are dedicated to provisions that are not repealed under that reconciliation bill.

So, what can be repealed? Well, tax credits. So, the small business tax credits, cautionary reduction payments, premium subsidies. Those are all directly related to spending. They can be repealed or changed, or you could implement a different variation of them. The individual and employer mandates cannot be repealed; we’ll come back to that again on the next slide. But the penalties can, because those have been ruled by the court to be a tax; so those can be repealed. Pretty much anything touching Medicaid in the ACA can be gotten at through reconciliation. And then any taxes like the medical device tax, Cadillac tax, provisions like that – those can be adjusted, changed, repealed. Restrictions on HAS, that’s largely tax policy. You’ll see throughout, it’s basically direct spending and taxes that are most likely to be caught up in this process. Next slide.

So what probably can’t be repealed? We’re using an example of the insurance forms, but remember what I said: there are ten pages in that twelve page memo. There are things they didn’t even try to get at in the first go round. Why can’t the insurance reforms be repealed as part of reconciliation? So, maybe we look at the essential health benefits, which we were just talking about earlier. The essential health benefits require certain minimum criteria of coverage to count as qualified health insurance. It creates a richer benefit than maybe was previously offered in the market place; therefore, the premiums will be higher. And because the federal government is subsidizing those premiums, the subsidies could be higher as a result of that. So you might think: well, see, it has a direct budgetary effect. These benefit requirements are making the federal government spend more money.

But the budgetary effect cannot be incidental to the purpose of the provision. The essential health benefits were not about budgetary outlays or revenue; they were about structuring the marketplace – it’s purely policy perspective. And so it is considered by most observers very unlikely that the parliamentarian would consider any potential spending effects of the essential health benefits to be more than incidental to the provision. And therefore, you could not get it through the reconciliation process. If you included that in the bill, it would likely fall as part of a Byrd Bath. So you can see all of these insurance reforms, but there are other things. There’s the pathway for biosimilars at SBA. There are a number of those things that were in the Affordable Care Act that even if you wanted to repeal, they’re just not directly related to spending and outlays.

Now there is some debate about this. There are folks who are arguing for including a lot of these things in a reconciliation bill and sort of daring the parliamentarian to cut them out. But there doesn’t seem to be appetite right now amongst Senate Republicans to do that. They’re trying to craft something that they think is likely to survive that process. So that is the gist of reconciliation. If we can go real quickly to the next couple slides, I think I have maybe a minute or two.

There are two things, and we’ll probably just talk about this during Q & A. There are two other things that I want to touch on. One is stabilizing the market during a transition period. You can’t repeal all of the Affordable Care Act, but you can certainly repeal enough related to the individual market to be disruptive to it. And even if there’s a delay in that repeal, we would argue that the individual market currently under Obamacare is facing quite a bit of trouble going into next year. And so Senate and House Republicans – I think – are realizing that they’re going to have to do some policymaking in the interim to try to stabilize that market in 2018 before any of their potential replacements are going into effect. And we can talk about that in Q & A. Next slide.

This is just a list of sort of categories of policies that are pretty consistent across Republican replacement proposals. Again, there are probably seven or eight relatively comprehensive proposals out there. They vary in degree of specificity, how much detail they give in numbers, etc. Some of them don’t say what their tax credits would be. But what we’re seeing is a general consensus around trying to give more state flexibility, getting rid of the mandate, and trying to use a sort of a continuous coverage type of provision. They want to keep a lot of the things like guaranteed issue. And they want to keep – at least in the context of a continuous coverage incentive – they want to keep allowing dependents on until age 26. They don’t want to allow bans based on pre-existing conditions again. So a lot of those things they want to try to keep, and so they’re trying to do that through a continuous coverage provision.

You will also see a lot of talk about failed insurance across state lines, eliminating age limits on catastrophic plans, a lot of talk about either a block grant of Medicaid or some kind of per capita allotment. So, these are the things that we’re seeing probably on – the subsidy would go away. But there would be some sort of tax credit that, pretty much across the board, Republicans have settled on an aged base tax credit rather than an income based tax credit. That might be delivered through some sort of HSA device. That’s kind of where we are very quickly. And happy to take any questions.

KARL EISENHOWER: Thank you Chris. Let’s pull up Brian Webb’s presentation. Brian is from NAIC and he’s our next speaker.

BRIAN WEBB: Well thank you very much. I was asked to talk primarily about where the health insurance commissioners and kind of what they’re seeing in their marketplaces now. I’ll caveat this at the very beginning by saying if you’ve seen one state, you’ve seen one state. So not all these things are happening in all states, but regulators are seeing a variety of changes to the market place that do cause some concern. So, if you go to the next slide.

First of all, we are seeing carriers pull out of the exchanges, which is critical because everybody knows in the individual market you can only get your subsidies through the exchange. So if there are not carriers in the exchange, that could cause a lot of problems. We’re also seeing the pull out of the individual market altogether too in some states, especially your more rural states, which means there’s no options off the exchange either. Now some are leaving the market because, well, the co-op for solvency reasons. Others just for business reasons – they don’t find the individual market lucrative. Therefore, they’re continuing their group coverage but pulling out of the individual market. And what that leads to is a real concern, especially in 2018, there will be service areas where there are no carriers. As we see this year, there are many service areas where there is only one carrier. Especially in rural areas, this is becoming a significant concern where you could have counties – and even some less rural areas – where you will have only one carrier or no carriers available.

Now, on top of that, we are seeing areas where there are fewer coverage options. Where you may even have a couple of carriers, but the only plans they offer on the exchange are HMOs or very limited network options. Not that state regulators are opposed to narrow networks. They are a good tool, of a carrier to use to control cost. But if that’s the only option available to consumers, that can cause a lot of problems. So we’d like to see at least some PPOs and broader networks offered, and we’re seeing areas where that’s not the case. As was in the press, and everybody knows, it’s also unstable premiums, and some states we saw significant increases in 2017. There is hope that we will not see those in 2018, and we just don’t know because there is tremendous instability in the premiums in many states.

Another thing we’re seeing that concerns regulators is commissions for agents and brokers. And several states, commissions were not being offered to agents and brokers who sell on the exchange or lower commissions for sales and plans on the exchange. And then some states, we even saw where all the carriers – what the carrier said on and off the exchange, “We’re not providing commissions for sales in individual market”. And to us that’s a concern just because this is complicated. Health insurance is complicated, the ACA is complicated; and even though people can go on a website, it’s best to have somebody who knows the system, knows what coverage is, to help them compare. And if they want that, they need to be able to find that, and if commissions go away that could be problematic in the future.

Now we see obviously a lot of positive things too that should never be ignored. We are seeing lowered uninsured rates, especially in certain states where uninsured rates were up in the mid-20’s and now they’re down in the low double digits. We’ve also got access to coverage for the most vulnerable populations. These are important things state regulators believe need to be preserved, but we do need to get a handle on some of these other issues. Let’s go to the next slide.

When state regulators look at their markets right now and they see these concerns, they look at really four issues that are creating this instability. One, of course, is unsustainable cost growth. We really haven’t been able to get control of healthcare costs, both claims and usage utilization. So, how can we do that moving forward? A lot of states are looking at this to try to get a handle on that.  A second item is the unstable risk pool. The individual mandate, the low penalty, has not really driven the younger and healthier people to buy insurance. The subsidies have made it more affordable but still not getting into the market place. Also, we’ve seen things like special enrollment periods, grace periods, transition plans. Those kinds of things create a pool that’s different than the carriers thought it was going to be.

We also have unreliable funding, cutting off funding for the risk corridors. The risk adjustment payments are, again, different than a lot of carriers thought they were going to be. The threat of cutting off cost sharing reduction payments, possibly cutting back on reinsurance payments to pay the treasury. All of these things – that unreliability – the carriers look at that and say that’s uncertainty, therefore I’m going to have to raise rates or I may have to pull out of those markets.

And the last thing is the uncertain regulatory environment. One of the things we’ve seen as this very complicated law has been implemented is a lot of regulations and a lot of changes to the regulations. State regulators have been most concerned, and I’m sure carriers have too, about mid-year changes to policies and interpretations. Last second changes right before an open enrollment period. For example, they came out with transition plans: those plans can continue; that was unexpected. It changed the market place; it changed the risk pool after rates were already ready to be implemented. And then just annually, constant changes to the regulatory environment and a lot of confusion often between federal regulators and state regulators to what the rules are. All of these things have added to the concerns of the insurance carriers as to whether they want to participate in these markets or not and have contributed to the rates; so let’s go to the next slide.

Going forward, now skip the first point because that was ably described by those speakers before me about legislatively where we are as reconciliation and possible replacements and amendments. But, I want to focus more on the regulatory. The NAIC and its members, which are other state regulators, are working with the Trump administration looking to see if there are ways in the regulations we can move quickly to help stabilize the markets. Things like special enrollment period verification, which is something the Obama administration has been working and was going to go in June, just making sure that’s going to work. Working on grace periods and things like that, to try to stabilize the risk pool as much as you can through regulation. Also looking at state flexibility. Are there options for essential benefits and how those are defined by the states? Are there other places where there can be more flexibility for the states to make decisions under the law? I mean the law is the law, that’s not going to change anytime very, very soon. But regulatory, there are a lot of interpretations that could be left to the states.

And then, finally, just the overall regulatory environment. The NAIC as members have long pushed for just making it clear that it’s the states are the ones. If they want to take on that role, they’re the ones that are going to implement the reforms, enforce the reforms, oversee the reforms. And kind of get the federal government out of the way. We’ve had problems in the areas like network adequacy – where it’s very clear in the regulations and the guidance that it is states that decide whether a plan has network adequacy, and states have rules in place and do that review. But in spite of that, the federal government still does its own network adequacy review using different standards, and that, again, just causes tremendous amount of confusion about who sets the rules and how that’s supposed to work.

There are also a lot of data requirements, there are a lot of redundancies, and we’re trying to work with the administration to clean that up and make it work better so that carriers don’t have those additional costs and unnecessary confusion. Also working on waivers, section 1332 of the ACA does provide for waivers, certain sections of the ACA. Hawaii has received one. Alaska is close to receiving one. We know that other states are looking at this, but it’s got to be a better process. States are asking for more of a template that they can fill out to seek a waiver, looking for better timing on how soon they’re reviewed, how soon they are approved, because remember state legislatures and everybody else is involved in this process as well. And just more clarity on what can be waived and what can be put into place. If we do that, we believe more states may look for ways to seek waivers.

The last area we’re tracking very closely are the lawsuits. Of course we have House v. Burwell which challenges the cost sharing reduction payments. We’ve had recent lawsuits regarding short term limited duration plans, third party payments, non-discrimination rules. So there are a lot of these lawsuits that, again, create uncertainty, that create some confusion. And looking to see if we can get some clarity on all those issues as we move forward. Let’s go to the next slide and just finish up here.

What are the states doing right now? Number one: we’re overseeing and enforcing the 2017 policies. They were put forth; the rates and the forms were approved. They’re currently in use. The open enrollment period just closed. We’ll be tracking very closely to see what the risk pool looks like now that everybody is enrolled. How special enrollment periods go for the rest of the year. Just kind of doing our due diligence with the 2017 policies. But also, we’re already kind of working in the 2018 world. That’s why we need clarity from Congress and the administration as soon as possible. Because beginning in March, states will start receiving rates and forms that, at the very latest, those will be coming in mid-July, so states will start reviewing them. They’ll start approving them for sale in 2018, so that we need to know the rules as soon as possible.

And then we’ll also be monitoring any federal legislation, changes in law, changes in regulation to see if states need to make changes to their laws and regulations. And also we’ll be considering state options through waivers or any increased state flexibility to see what we can do to try to stabilize our markets for 2018 and beyond. I will leave it there and I’ll turn it back over to the moderator.

KARL EISENHOWER: Thank you Brian. Our next presenter is Mary Agnes Carey, who is a senior correspondent at Kaiser Health News. Mary Agnes, thank you for joining us and go ahead and get started.

MARY AGNES CAREY: Sure, thank you. My hope today is to give you some tips as you watch Congress, and how to think about Capitol Hill, and how to cover it. So with that, I’ll go to my first slide.

The key committees that you need to watch are: in the Senate, the Finance Committee and the Health Education Labor and Pensions Committee (that’s also known as the HELP committee). In the House of Representatives: Ways and Means as a critical committee for healthcare, as is the House Energy and Commerce Committee. If you’re curious about these committees, if you want to check them out – I would sign up for their press list. You can also find out if your local lawmaker is a member of one of these committees. You can easily go to or and hit the Committee tab and look at the members on the committee. Who is there, how do you sign up for the press lists? I would encourage you, for story ideas, to watch some of these ACA hearings and something called a markup, where the legislation is developed. When there’s a markup, it’s kind of the nuts and bolts of the legislating – members can offer amendments, you will hear a debate. You really start to get a feel for what members are thinking and where they are on a particular issue. And it’s also really important to pay attention to the Republican leadership.

There’s a phrase called regular order which you may hear, and that means having the committees work through the legislation and so on. But there comes a point, especially as you get closer to a deadline that might be set by the leadership, where the leadership kind of has to make a call. And so you know, Mitch McConnell and Chuck Shumer in the Senate come to the mic’s every Tuesday after policy lunches around 2:15pm. You can watch this thing on C-SPAN. You can get a sense of it. Paul Ryan has a weekly news conference often on Thursday mornings, same kind of thing, so it’s really important to watch what’s happening. For example, jumping back to Senate Finance Committee, we had some fireworks – the Washington definition of fireworks – today, when Republicans wanted to move the nomination of Tom Price to head the Department of Health and Human Services, and the Democrats stayed out yesterday and said they were going to stay out today. And while a committee rule says that Democrats are supposed to, at least one Democrat is supposed to be there to move the nomination, the Republicans on the committee went to another committee rule to waive the rules, and they moved the nomination. So you kind of get a feeling that we’re going to have a really long year on this debate over the Affordable Care Act. And the deadlines are kind of moving, they’re all over the place, about the reconciliation bill that was discussed earlier. Somehow the committees and jurisdiction were going to report that out by the end of January – that didn’t happen. Now we’re hearing a lot of talk that they’re going to take as much time as they need, maybe March, maybe even by the end of the year. The bottom-line here is reform is hard, it’s difficult. We heard from the panel so far that things are complicated, so keep that in mind. Next slide please.

It’s important, obviously, for you to focus on your local lawmakers. I think it’s important to talk to your local lawmaker’s office as well as the DC office to let them know who you are, that you’re really interested in ACA overhaul so they keep you in mind. Chances are your best contact for your press inquiries is going to be the DC office, but again, if you’ve got a relationship with the local office, check that with them. And I think an important thing is to find out, get to the press person, the same kind of thing, go through the website. But a really key thing to do is to establish a relationship with the key staff person on healthcare before everything hits the fan. You know in the heat of the moment when everybody is calling them, if you haven’t made contact, you might not break through. But members, they love national press – don’t get me wrong. But they really know that all politics is local, and they’ve got to talk to these local reporters and keep them in the loop. So establish that communication now. And also, think about are there legislative disputes within the delegation? Do you have splits over various replacement plans on the Republican side? Are there some people that want to keep the individual mandate and others that don’t? Are there fissures within Democrats?

We’re going to talk in a minute about some vulnerable Democrats in the Senate may or may not decide that it’s worth their while to work with Republicans on an ACA replacement because they’re facing re-election in a couple years. How is your local lawmaker trying to shape the process? I know Mark is going to talk more about this in a minute, but it’s important to talk to your lawmaker: who are you talking to at home? Especially if you’ve got a local lawmaker who is on one of these committees of jurisdiction, think about a Q & A with them. Because it wouldn’t only get attention in your local press if you get that out and you tweet it out, you Facebook and so on, you may get that picked up by national publications. Reporters all over the place are trying to figure out how this is going to shake out. Next slide please.

Linda sort of touched on this before, as did the other speakers. There are a lot of specifics now that are up for debate. All those things that I’ve got listed: how many people are going to be covered? Will pre-existing conditions be covered? What are these plans going to cost? What’s the impact on the budget? Do they do anything to control healthcare costs? These are all the key questions that you need to be asking and looking at as you work through the whole idea of Affordable Care Act replacement. Next slide please.

So what about that ACA executive order? You know, that caused quite a big stir when President Trump did that right after inauguration. I’d like to point you to a link to it there in the slide. Julie Rovner, my colleague, did a great explainer for Kaiser Health News. Bottom line is the wording of the executive order is strong; the actual impact may be weak. It didn’t give any more power to these agencies that they didn’t already have. But it might signal where they could go in a regulatory process. Brian talked about the 1332 waivers. There may be Medicaid waivers. There may be changes or an elimination of the essential health benefits, the required benefits that have to be in these policies now. The individual employer mandate might get waived. And I also think this could be another, was intended rather, as another pressure point on House Republicans. Trump ran on repealing the ACA. He wants it done; he’s sending a message to the Hill – “Get on it guys or I will try to go after it in the regulatory process”.

So, it’s definitely worth watching. But it does not mean like right now they can repeal the ACA. They still have to go through regulatory process in these areas, put them out for public comment and that kind of thing. So, I just wanted to touch briefly on that. Could I have the next slide please?

So how will Democrats respond, right? We just touched on that a moment ago. It’s very clear that Democrats are fighting against efforts to weaken the ACA. They’ve been extremely clear about that. And as discussed earlier on reconciliation, they just need fifty-one votes to repeal those provisions in the law that fall under reconciliation. But when it comes to those that are not covered by reconciliation: in the Senate, sixty votes are needed. And they don’t have, they being the Republicans, don’t have sixty. I think the breakdown is 52/48, and 52 being the Republican margin. So that’s the key question, right? Can they get Democrats on board? Will they get them? It certainly doesn’t look like it now, but it’s fairly early. We’re only at February 1st; it’s really early in the legislative process.

I think it’s important to note that you’ve got so many folks on the Democratic side, as well as two independents, that are up for re-election in 2018. 23 Democrats, two independents who caucus with the Democrats. Will those in the vulnerable districts want to work with Republicans on an ACA replacement? As things go on, could Mitch McConnell, who is the Senate Majority Leader, and other Republicans craft a replacement that gets some Democratic votes? They’re going to need it in some areas. Highly unclear, but worth watching.

Another thing to remember for these Democrats that are up in 2018, many of them must – they’ve got to defend seats in states that were won by Donald Trump, right? They’re kind of Trump territory right now, so how will that effect what they do? And then I’ve listed some vulnerable Senate Democrats, and the list may grow but it’s worth finding out your Senator on that list if it’s a Democratic senator. What are they doing? Who are they talking to? You know, there’s also this whole thought that Republicans kind of force this game of chicken with Democrats. That if you have reconciliation and things are repealed, it’s getting further down the line to all this discussion about the insurance companies. They need reassurance at certain points to know that: will they be paid? Will the plans continue? Will the exchanges continue? Can Republicans use that to force Democrats to vote with them? That’s up for great debate, but it’s something again to be considered. Next slide please.

And finally, just a quick note about how Kaiser Health News can help. We’re a national nonprofit healthcare news service, and we give our copy away. That really surprises people; you can use it for free. We’re an editorially independent program of the Kaiser Family Foundation. We’re not affiliated with the insurer Kaiser Permanente. Our stories do run all over the country: New York Times, Washington Post, USA Today. We have a very vibrant partnership with National Public Radio, and you’ll hear Kaiser Health News at the end of those segments. You can use our stories in whole, or you can even use them for background. If you don’t want to write a story, for example, about the individual mandate and we have one, you can take the story. Use it for B matter, retop it locally – just give us credit. I’ve got a link to how to do that there. But if you need help, I’d be happy to help you.

And one last thing is we have a fantastic news aggregation. The KHN Morning Briefing. It’s free and you can subscribe. Go to, and the instructions are right there. But it lists not only Kaiser Health News original content but the best healthcare stories from around the country. So, if you want to keep on top of healthcare, but you don’t have time to search all this stuff out, we do it for you. Check – you’ll be all set.

KARL EISENHOWER: Mary Agnes, thank you very much. We’re running a little tight on time so I’m going to hand off to Mark Zdechlik and we’ll pull up his presentation. Go ahead Mark.

MARK ZDECHLIK: Well thanks, thanks for having me. I’ve been a reporter at Minnesota Public Radio for 30 years. I’ve done a lot of political reporting, but in the past couple of years, I’ve been focusing on healthcare and working with Kaiser Health News and National Public Radio. And all of the stuff can be very daunting and seem too big to get after. How can I do this in my little section of the country? And the fact of the matter is, it all boils down to people. It’s big and complicated, but it’s all about people. And I have found that, unlike many other areas of my reporting, people really want to talk about health insurance. It is a bottom-line item for many people. Everybody has a horse in this race. And people are remarkably approachable, and it’s really stood out to me as something that’s interesting with this particular beat.

I would recommend that you get to know some of the statistics, the trends, and proposals that are out there. And then humanize all of that. Profile a family that’s got a high deductible plan. Go talk to somebody that is now part of the ACA-related Medicaid expansion. Talk to them about how their healthcare is different now than it was, and what it might be like for them if it were to go away. In Minnesota, we had a high risk pool called the Minnesota Comprehensive Health Association and that’s now gone, but there are a lot of talks – talk right now about bringing back high risk pools. I am working right now to try to track down some of those people to see if indeed there were good old days of that high risk pool, or it was a case that was actually very expensive. You can profile people struggling to pay for prescriptions. Any number of things, you can find them through social media, you can just stalk them in the clinic parking lots. You can also get help tracking these people down by talking to navigators who line people up with Affordable Care Act coverage or insurance brokers. Insurance brokers, in particular, I think are phenomenal sources of not only helping you get in touch with people but just what’s going on trend wise and that kind of thing.

I would also recommend getting to know providers; get to know a health system. Zero in on a hospital that’s particularly good in your area. They’re always putting out press releases about a new birthing suite or whatever it might be. Find something that’s tolerable to profile, that they’ll enjoy. Get to know them and then leverage the relationship with them to get in their front door on some stories that may be a little bit more complicated and a little less complimentary of whatever the efforts they’re making. But get to know a hospital.

Government programs, like everything else, they’re all very extremely local in their execution. Get to know, just like you would, a hospital administrator. Get to know somebody who is working at the government level to administer these programs, maybe in a county or something. Where do they see waste? Where do they see opportunity? And then also find the public program participants. What are they struggling with? What’s working with the programs? What’s not? What are the concerned about? What are they worried about?

And I would also say, try very hard not to avoid the complicated paperwork. It looks like a lot, and you can get a lot of information though by actually digging into some of the filings. Health companies are highly regulated. And when they want to do something like get into a market or get out of a market or increase prices or change coverage somehow in America, they have to try to back that up in filings with regulators. And these filings, at first glance, look impossible to read. I’m not an attorney and that kind of thing, so how am I going to get through it? But if you spend some time maybe with one and poke through it, you’ll actually see that they’re pretty well organized, and get to the point where if you use one as a model, you can pick another insurance company and get the same information about how they feel the market is panning out for them. And we heard from someone from the National Association of Insurance Commissioners – that’s a phenomenal place to get information, and a lot of the regulatory requests and things are filed with them. And they’re really full of information that the companies don’t readily make public – that’s my experience anyway.

And then I would, as we look for ways to cover people, to do a better job for less money. Look at innovation, what’s happening on the ground to deliver care in a more convenient way at a lower price. What are health systems doing to keep people on their medicines and out of the hospital? What’s going on with chronic care management trends? These are all sort of front line efforts that you can easily localize in this battle to get control of out of control healthcare costs. I don’t have much more for you than that, other than to just encourage you not to be scared away from all this because the space is so complicated. It is complicated, but you can pick it apart even if it feels like it’s a big national kind of policy story. You can almost invariably localize it. And I’ll be happy to take any questions when we get to that time.

KARL EISENHOWER: Thank you Mark. Brian Webb from NAIC is time constrained so as we go to our Q & A section here, I want to quickly ask a question of Brian. We have a question from a viewer about rate review. And under the Affordable Care Act, if the federal government feels that rate review at the state level is insufficient, they can step in. And the question is, how much of an appetite to do an aggressive rate review did those states have, in the states that the federal government is doing rate review for right now?

BRIAN WEBB: Yeah there were only three states that don’t have, what they call, an effective rate review, and that is Wyoming, Texas and Oklahoma. Both Missouri and Alabama were on that list, but they’ve adopted the rules for that. In those states, there is some concerns, especially if you’re a small state like Wyoming, whether they would have the personnel. But there’s always other ways to do it. The NAIC does help states, and so we do believe that if the federal government isn’t doing it, the states would pick up that mantle and go ahead and do an effective rate review.

KARL EISENHOWER: Okay thank you Brian. I want to let our audience know that there are a couple ways you can get questions to us. Click on that orange arrow in the toolbar and you’ll see a questions panel. If you type something in there, we will see that. You can also send your questions on Twitter with the hashtag #allhealthlive. So, I have unmuted all of our panelists, so be aware of that. But before we move on to another question, I just want to see if anybody else wanted to jump in on rate review?

Okay, the next question I’m going to ask this one to Linda. And then others can jump in later if you’d like. We’re getting questions about pre-existing conditions, and one of the proposals for dealing with pre-existing conditions is to take them out of the regular insurance market and move them into high risk pools. That’s not a new idea. That’s something that we actually have experience with, how high risk pools have worked in the past. And we wanted to see if you could give us some insight on how they worked in the past and what we can expect if we shift people into high risk pools.

LINDA BLUMBERG: Sure, we do have quite a bit of experience with high risk pools prior to 2010 when the Affordable Care Act was passed. 35 states had their own high risk pools. These varied in terms of their characteristics very broadly, but in general, they had very small numbers of enrollees. The rules for enrolling were pretty tight. Generally, it was either you were denied coverage outright having applied in the non-group market, or you had one of the list of particular conditions that the state permitted in. Only two of those 35 states that had high risk pools had any income related assistance for people. So if you were low income, the premiums were very high – only Minnesota and Maryland had some financial assistance for lower income individuals. Most of them had pre-existing condition exclusion periods themselves. So people sometimes had to be paying, you know, 12 months’ worth of premiums to the high risk pool before their pre-existing condition that got them into the high risk pool was covered. There were generally high cost sharing requirements.

These are pools that, by their nature, are only enrolling people who are expected to have very high medical needs. And as a consequence, the cost of providing comprehensive coverage to that kind of population is extraordinarily high. States subsidize them to some extent, but it was limited in terms of how much revenue they raised. So often times people had to pay for their premiums 150% of what was standard in the non-group market. Sometimes up to 200%, more of what was standard. And so the number – the people who got in there and got health insurance coverage, you know, for many of them it saved their lives. But they were really a limited value for the broader population who could have used them, with all of the denials and limits and exclusions on coverage, because the costs of covering people adequately when the whole pool is high cost is prohibitive. And the states never got around to really raising enough revenue to make them as effective as they could have been. Doing that would cost a lot of government money, much more than those who proposing going back in that direction are considering allocating.

KARL EISENHOWER: Okay does anybody else want to jump in on that one?

MARK ZDECHLIK: I talked about what our experience with the Minnesota Comprehensive Health Association. Looking back to the good old days of high risk pool insurance, and the reality was it was not good old days for people who are in it. They served a critical – plugged the gap for them, but they’re in a much better position right now and that needs reporting.

CHRISTOPHER HOLT: I would just say too, if you’re doing an interview and the subject of high risk comes up, it’s very important to ask what the person talking to means when they say it. Because high risk pool can mean anything right now. People are using that phrase as sort of a placeholder almost. So it’s really important to note what specifically they’re talking about, if specifically they’re talking about anything.

LINDA BLUMBERG: Well Minnesota had one of the two best high risk pools in the country. So when you talk to the people that were enrolled there and they’re telling you that they had much more limited coverage and it was as affordable than what they have now, that’s really telling you something because they were probably the best pool in the country, and with Maryland second.

MARY AGNES CAREY: For just some background for folks: we had a story recently, it was based in California but it looked at the experience of high risk pools throughout the country. Pauline Bartolone, my colleague out in California, wrote that story. You can look that up. And also, we have a video explaining what high risk pools are, how they work. It’s not too long, don’t worry. But, it can help give you a baseline of understanding if you want to at least understand what a high risk pool is, might be able to help you.

KARL EISENHOWER: Another issue that we’re getting questions about pre-existing conditions is that right now, sort of a tradeoff for insurance companies, is they insure people with pre-existing conditions because they’re penalties for people who do not sign up for some form of insurance coverage. There has been the idea that, even without legislation, for the Trump Administration to just stop self-enforcing the individual mandates through tax penalties. If that were to happen, I’m going to ask this to Chris first, what could we anticipate the reaction of the insurance companies would be?

CHRISTOPHER HOLT: Well first of all, I do think that the Trump Administration intends to cease enforcement of the individual mandate and likely the employer mandate, but specifically the individual mandate. I think the executive order indicates that quite clearly. How quickly they do that is maybe up in the air. There’s implications for any repeal or replace legislation because if you got rid of the mandate and you didn’t do anything else, obviously you would expect the drop out of the market. That starts to change both numbers of insured. But also it starts to change federal spending, and so if that becomes calculated into the baseline, it can affect the score of any replacement legislation. So I think Congress and the administration are talking about the timing of that, but I definitely think the Trump Administration wants to go in that direction.

In the absence of anything else, that’s certainly the insurers would say that’s really problematic for them. I don’t know how effective the mandate has been, but certainly if you talk to your local insurers they can give you a sense of how effective they feel like it’s been. I think it is ramping up as the penalty has gotten higher. But I think initially the penalty just wasn’t substantial enough to really drive anyone to seek out coverage. What Republicans are largely talking about, and again when you’re talking to a specific person you want to find out what they mean by this. But it’s some kind of continuous coverage requirement that would say: instead of a mandate, there’d still be guaranteed issue. But if you didn’t maintain coverage – however that was defined – then perhaps the insurers would be allowed to go back to medical underwriting, or maybe you would have to go into a higher risk pool for some number of years. But the idea is to develop some sort of mechanism to provide a similar motivation to the mandate. Whether it will be more effective remains to be seen.

KARL EISENHOWER: Anybody else want to jump in on that one?

LINDA BLUMBERG: Sure, I’ll jump in. We have estimated that by eliminating the individual mandate, we believe that the number of uninsured would increase relatively quickly by approximately four million people. Household surveys have shown that there has been significant uptake of individuals taking up insurers as a consequence of the mandate. And those that are taking up as a consequence of the mandate are very likely to be significantly healthier than those who would be coming in on their own. So once you lose a few million people at a minimum of – from the health insurance pool, you can expect the insurers to need to increase health insurance premiums significantly in order to account for the change in the risk pool. The problem is if you stop enforcing the individual mandate penalties in the midst of a plan year, you start losing people from that coverage pool during the middle of the plan year. They know they’re not going to be penalized anymore. But the premiums are already set for the year. So, this could lead to pretty significant financial losses for insurers during the course of the year if the administration takes that approach.

KARL EISENHOWER: Okay, we’ve got a question about mental health coverage. Under the Affordable Care Act, there are minimum levels of coverage, essential health benefits that include mental health coverage for things like substance abuse disorders. If those essential benefits go away or gets shifted to the states, what can be done to incentivize insurance companies to continue covering mental health coverage, which in a lot of cases they’re reluctant to do? Linda, do you want to start off on that one?

LINDA BLUMBERG: Sure. I think it would be very difficult to get insurers to do that without essential health benefit requirements. The problem is that if one insurer does it and the other insurer doesn’t, and they’re going to attract individuals who are going to be more likely to use those services. Their premiums would go up differentially as a consequence; they wouldn’t be able to compete in the market. So that is why when you look back to where these markets were prior to the implementation of essential health benefits under the Affordable Care Act, was very unusual for non-group plans to include mental health benefits writ large, let alone substance use disorder. So it really – in order to keep these benefits that people might be able to assess, you know, that they’re at higher risk for before an insurer could figure it out.  You really need to have them as defined as part of the requirements for all insurers. Otherwise one insurer can’t act alone or small number of them can’t act alone to do it without enrolling too high a cost of population to compete.

MARY AGNES CAREY: I just wanted – Linda, how does that intersect, how does essential health benefits intersect with the mental health parity law, which theoretically was supposed to mean if you cover it, you’ve got to have the same coverage and coverage limits for physical ailments?

LINDA BLUMBERG: Those mental health parity requirements were strengthened under the Affordable Care Act as well. So, it would – before 2010 I believe, it’s not my area of expertise, but my understanding is that the mental health parity rule said if you offer mental health benefits in your package, you had to provide parity with the general medical benefits that you are offering unless that would lead to an increase in the premium of a certain percentage. And I can’t remember what that percentage was at the moment.

But when you have those benefits in the package required broadly by all of the insurers in the market, then the parity rule obviously can be a lot stronger because it’s there for everyone. Everyone has got to be providing those services without more limits than they’re doing for general medical care.

KARL EISENHOWER: The next question is about 1332 waivers, and I think Mark or Mary Agnes first. In your reporting, did you get any sense that states are anticipating additional flexibility and are preparing to do more through those waivers than they thought they could get past the Obama administration? Mark, are you hearing anything about that in Minnesota?

MARK ZDECHLIK: Absolutely, they’re very optimistic that now is the time to come up with a proposal that might cost less and be more efficient. In Minnesota, we’re talking right now with the Democratic governor is asking the Republican legislature to create a public option with the version of the medical assistance we have to let anybody buy into it. There have been proposals to modify it. We already have an interesting medical assistance program that has two different pools. And I don’t want to get into all that, but the bottom line is the policy folks here are thinking that with things, the Trump Administration has said right out of the shoot, that now would be a very good time to look for a waiver.

KARL EISENHOWER: Mary Agnes, in other states using evidence in other states or similar position?

MARY AGNES CAREY: Yeah, I think they’re extremely hopeful that they can do this because the – as you noted in your question, they felt perhaps the constraints of the way that waiver would be judged or evaluated by the Obama administration would be at a much stricter standard. So, I think they’re extremely hopeful for flexibility. They want to see Tom Price get in, see what else he’s doing, but I think a lot of the states are beginning to look at this for exactly all the reasons Mark’s talking about. They want to be able to save money. They want to conform it to their state. I think they’re thinking they’ll get a better evaluation, if you will, of the waiver under a Republican administration than they would President Obama’s administration.

KARL EISENHOWER: Okay, Chris, I’m going to ask this one to you to start off. We’re getting a lot of questions about selling insurance across state lines. So, can you talk to us about what the issue is there and what the anticipated impact of that would be and how realistic it is, if that would make a difference to the choices consumers have?

CHRISTOPHER HOLT: So I’m outside the main stream on the conservative side here. I don’t think the sale of insurance across state lines is a very significant policy proposal – partly because states can already allow it. And in fact some states do allow it, and some states have interstate compacts specifically designed to foster the sale of insurance across state lines. Insurers aren’t particularly interested in doing it because they don’t have networks in states that they’re not already selling in. And if they do have a network and are already selling in that state, they’re not necessarily interested in importing a plan design from a different state. And so I don’t think – it’s not necessarily a bad thing to do, to push, but I don’t think it particularly does much to increase competition the way Republicans hope it will.

I also think the only way you could really push it would be to sort of supersede states’ abilities to regulate their own insurance markets and force them to accept coverage from other states that don’t necessarily meet the state insurance market regulations that they have. That I think is a bad thing and not typically conservative approach, and but that potentially could generate lower premiums, but also potentially erase to the bottom as far as what is covered by that insurance.

I would say we also have a paper on this as well over on our website if you just searched “across state lines”.

LINDA BLUMBERG: I’ll jump in. I also have a paper on this on the Urban Institute website. And this is outside the realm of the Affordable Care Act that does allow, with restrictions, there to be coverage sold across state lines that doesn’t undermine one state’s set of regulations relative to another. When the alternatives are talking about allowing unrestricted sales of insurance across state lines, it can be very dangerous and that it would absolutely, as Chris alluded to at the end there, would lead to – from our perspective – a race to the bottom in terms of what insurers would be able and willing to sell. Because if one state’s regulations were allowed to be undermined by another, no state could offer comprehensive coverage or do more sharing of healthcare risk across their pool without that pool then enrolling just higher cost individuals.

Unrestricted sales across state lines are a very dangerous policy to put in place. It doesn’t lead to real economic competition on delivery of care and efficiency networks. What it does is lead to greater competition for enrolling the best healthcare risks to the detriment with health problems.

CHRISTOPHER HOLT: This is another one of those set of words that get used a lot where as a reporter if you’re talking to someone, it is really important to try and figure out what they mean by across state sales insurance. Because again, if they’re just saying if a state wants to let people sell insurance here and they want that insurance to meet their state regulations, that’s one thing. If they’re saying we kind of want to take away the state’s ability to regulate their own insurance market, then that’s different. And so it is important to make sure that you understand what that individual that you’re talking to means when they say that.

KARL EISENHOWER: We’re at the end of our time. I’m going to try to squeeze in one more question, but before we do that, Jared if you’d go to the next slide. In about an hour, you’re going to get an email asking you to fill out an evaluation of this webinar. We’re putting on this program for you. We want it to be useful. Your feedback is very important to us. So if you could take a look at that evaluation survey and fill it out, that would help us a lot. So, the final question, I’d like each of our panelists to take a stab at this one, and we’ll do it in the order that you all did your presentations. So, Linda, if you answer this one first. There are at least seven or eight Republican proposals floating around right now from various members of Congress. Which ones do you see as – which one do you see as being the strongest? And I guess we can answer that as most likely to pass or most likely to be effective and meet the goals that it has. But which Republican proposal are you watching as the one that’s most interesting to you?

LINDA BLUMBERG: Well, I haven’t seen all seven or eight of them. Obviously a lot share very strong commonalities in terms of, you know, continuous coverage requirement that would replace an individual mandate, providing financial assistance by age instead of by incomer financial need. All of these have, as I tried to allude to before, implications for vulnerable populations to be able to access insurance versus those who are healthy or wealthy. So, those are kind of – I mean it seems like that’s the direction of these proposals. I was interested the other day to see the one that came out from Collins and Cassidy and maybe others that were suggesting an option for states being allowed to maintain the Affordable Care Act if they wanted and go another way if they didn’t. I don’t know how much support there is for that among the Republicans, and I don’t know how it would work in practice, but I think that’s an interesting one to watch.

CHRISTOPHER HOLT: Kind of like I alluded to in my presentation, and certainly that paper that I mentioned earlier by Tara Hayes kind of gets into this. There’s not – one of these proposals is not going to emerge as the Republican proposal first of all. Whatever becomes the Republican proposal will be some sort of new developed legislation that looks like these broadly, but there’s not one that’s going to pop out. I think Cassidy/Collins is not actually a new proposal either. Cassidy and Sessions had introduced – Pete Sessions, not Jeff Sessions to be clear there – had introduced similar legislation last Congress. And this is sort of a growth out of a proposal that Senator Cassidy put forward during the King v. Burwell case in the event that the subsidies were to go away. I think it’s getting a lot of attention because it’s one of the only legislative proposals that’s been introduced in this Congress. But ultimately when – I think it’s unlikely to save very much in the way of money; and so I think the proposal as drafted is unlikely to gather a lot of Republican support.

KARL EISENHOWER: Before we move on to Mark and Mary Agnes, we’re getting questions about being able to download the presentations. Give us about 10 minutes and come to the website and we’ll have all the presentations there. So Mary Agnes, do you want to weigh in on that question?

MARY AGNES CAREY: I think Paul Ryan “Better Way” is kind of a baseline for a lot of Republicans. It’s been approved in the House. It’s got some stuff in there. If Republicans decide to do premium support on Medicare, that might be a heavy lift in a year where you want to overhaul the ACA, do to tax reform, do infrastructure, have a Supreme Court Justice be voted on. The agenda seems quite large but I think that is a roadmap to an ACA bill, but I agree with Chris, basically it’s going to be a starting point and they’re going to have lots of different elements. Especially if House Republicans go down this road of passing a bunch of different bills, I guess the Senate gets stuck combining them into one, but I’m watching the Ryan proposal.

MARK ZDECHLIK: It’s hard for me to say. I would say the people I’m talking to are kind of more the Minnesota Republicans who are looking for changes and they’re talking a lot about tweaking – or much more than tweaking – essential benefits, so that you can essentially sell people catastrophic coverage. And also they’re promoting a return to high risk pools to cover people who find it impossible to buy coverage in the non-group market if core of the ACA were stripped away. So I think it’s a bit early for all this so that’s all I got.

KARL EISENHOWER: Okay, well thank you everybody for joining us today. Thank you very much to our panelists. We’re doing a series of these webinars this year. So if you’re not on our mailing list, when you come to to download the presentations, make sure you sign up for our mailing list and we’ll talk to you again soon. Thanks.