State withdraws insurance stopgap measure

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DES MOINES – The Iowa Insurance Division has withdrawn its effort to create a stopgap insurance program for Iowans, according to a release today from Governor Kim Reynolds office.

State officials, including Iowa Insurance Division (IID) Commissioner Doug Ommen, received a letter on Friday from the Center of Medicaid and Medicare Services outlining how federal funding will be calculated for the state’s waiver, also known as the Iowa Stopgap Measure. The announcement came early Monday afternoon. There were also concerns about the timeline for providers to be able to handle the application process with the Nov. 1 ACA open enrollment date quickly approaching.

“Premiums under Obamacare have increased 110% for Iowans since 2013, and thousands of Iowans can no longer afford health insurance,” Governor Kim Reynolds and the Centers for Medicare & Medicaid Services (CMS) Administrator Seema Verma said in a joint statement. “Iowa pursued state flexibility through the Stopgap Measure, but ultimately, Obamacare is an inflexible law that Congress must repeal and replace. Obamacare is unaffordable, unsustainable, and unworkable.”

“Obamacare is an unworkable law,” Ommen said. “The Stopgap Measure was an innovative solution to help thousands of Iowans. Unfortunately, Obamacare’s waiver rules are so inflexible that the Stopgap cannot be approved under terms that would be workable for Iowa. This is evidenced by the fact that a bipartisan group of senators recently announced a bill to fix some of the inflexibilities on Obamacare’s waiver provision that Iowa has run into.”

Wellmark Blue Cross Blue Shield indicated if the stopgap measure were put in place in Iowa, it would be willing to offer ACA plans in 2018, as well. Many insurance providers are continuing to offer insurance plans in Iowa, but only Medica will offer ACA plans that may include subsidies to offset premium costs. However, Medica has said premium rates could increase by as much as 57% in 2018.

“I think it’s generally the administration’s lack of flexibility. Generally speaking, President Trump has been very clear that he wants it gone and he doesn’t want to put a band-aid on it,” said Justin Pieper from Fort Madison’s Group Benefit Partner’s office.

“Medica will be the only carrier and it will be very status quo as it was last year. We have not seen the rates and how the subsidies are going to be impacted. So anyone eligible for a premium subsidy should be eligible and the subsidies will likely be absorbing that increase, but we haven’t seen any numbers.”

Pieper said Ommen was very clear that this was a stopgap, not a long-term solution, and was intended to bring some short-term cost relief to the market until further progress could be made at the federal level.

The Affordable Care Act provided in Section 1332 a path for states to file for a waiver, but if those states are facing a failing market, and if they are successful in stabilizing the market and bringing people back in, the waiver will not work. In other words, the title of Section 1332—“state innovation waivers – is an oxymoron”, according to the governor’s release.

“We are hopeful that expansion of short-term health plans and association plans for individuals will provide much needed relief in the near future. Additionally, Iowans eligible for Obamacare subsidies or who can afford the high cost of Obamacare will be able to sign up for health insurance on, starting November 1, 2017, with Medica.”

Wellmark issued a statement following the announcement.

“Wellmark commends Governor Kim Reynolds, Iowa Insurance Commissioner Doug Ommen and their staffs, for taking the lead in creating the Iowa Stopgap Measure. We also want to thank Senators Charles Grassley and Joni Ernst for their strong support of this effort.  The Iowa Stopgap Measure is the most innovative attempt to address the challenges with the individual Affordable Care Act (ACA) market in the country. Wellmark stands by our beliefs on what it will take to stabilize the individual ACA market and will continue to work on a long-term solution with state and federal officials.”

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