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HSS Draft Rule

A leaked rule from HHS, that is aimed to help stabilize the individual insurance market, reveals the narrow limits of Trump Administration on healthcare reform. It is reported that HHS has submitted a proposed rule to the Office of Management and Budget, but the details of the rule is not yet released. Only two different draft versions of the rule are now available.

It is rumored that the provisions in the leaked rule are in consistence with the changes that are sought by the insurers to have an improved balance of sicker and healthier people in the risk pool, make the individual healthcare market a more profitable business, and bring down premiums and costs.

The reported provisions in the rule “are hopeful for us,” said Daniel Hilferty, who is the CEO of Independence Blue Cross, and a member of the executive committee of America’s Health Insurance Plans. Hilferty also serves as the board chairman of the Blue Cross and Blue Shield Association. He added that the reported rule suggests that, “the administration is listening and our message is getting through.”

However, experts say that the proposed changes do not address any important needs of the insurance industry leaders, which are necessary if they need to remain in the individual healthcare market in 2018. These changes include congressional funding for ACA’s cost-sharing reductions, preserving the premium subsidies to offer affordable coverage, and the restoration of the risk payments to protect those insurers who sign up disproportionately sick people.

Conservatives are opposing such measures and they call these measures insurance company “bailouts.” However, neither President Trump nor the congressional Republican leaders have said anything about the rule or the issues.

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Cost-Sharing Reductions

“The small nature of these changes shows that real reform has to come through legislation, because none of this will fundamentally change the market,” said Craig Garthwaite, who is a health insurance expert at Northwestern University. “And it’s not even legally clear they can do this.”

Another challenge for the Trump Administration trying to stabilize the healthcare market via rulemaking is time. It is reported that even if HHS issues a rulemaking notice tomorrow, soliciting, reviewing the public comments, and publishing the final rule will take about two to three months. However, the insurers will need to file the 2018 plan rates and offerings by April and May and they will need to know the rules before submitting their plans and rates.

“It will be tight,” Hilferty said. “We’ll already be modeling what we think the rule changes will be, based on the components that could be included in the rule.”