What Does the Change in House Leadership Mean for Private Health Insurance? CHIR Experts Make Some Predictions

Most political watchers predict that the Democratic takeover of the U.S. House of Representatives is a recipe for legislative gridlock. For the most part, that’s likely to be true. But exit polls suggest that health care is a top priority for voters, particularly the protection of people with pre-existing conditions and rising out-of-pocket costs for consumers. Many newly elected members of Congress will be eager to deliver for their constituents on both of these issues, and there may even be opportunities for a few bipartisan breakthroughs. At CHIR, we study private health insurance, so we grabbed our crystal balls and made a few predictions about what the new House leadership will do on these issues.

It’s All about Affordability

Health care costs too much and voters are crying uncle. While ultimately Congress needs to tackle the politically thorny problem of high provider prices, in the short term, we predict House action on a few issues that can help consumers with insurance premiums and cost-sharing. These include:

  • Reinsurance. A bipartisan effort to fund a reinsurance program for the individual insurance market sputtered out in this Congress, but could be revived in the next one. Although premium increases moderated for 2019, prices remain extremely high, particularly in rural areas with less plan and provider competition. A federal reinsurance program is projected to reduce premiums between 3.9 and 19.3 percent in 2020, depending on how well it is financed.
  • Surprise balance billing. A true scandal and sign of the deep dysfunction in our health system, the phenomenon of patients receiving thousands of dollars (or even $109,000, in one highly publicized case) in unexpected charges from out-of-network providers is crying out for a legislative solution. Bipartisan bills have already been floated in this Congress and we’re sensing that many current and new members have a keen interest in getting something done on this issue (although exactly what is the tricky part).
  • Family glitch. The House could also advance a bill that would help middle class families afford coverage by fixing the so-called family glitch. (As a refresher, the family glitch is a flaw in the Affordable Care Act (ACA) that locks many low- and moderate-income families out of premium subsidies for Marketplace coverage. If someone in the family has access to “affordable” job-based coverage, the entire family is ineligible for Marketplace premium assistance, even if the cost of the family premium for the employer-based plan is not affordable.) Unfortunately, fixing the family glitch doesn’t come cheap – one estimate pegs it at up to $6.5 billion per year. But the population helped – working families – could make it an attractive early piece of legislation to pursue.
  • Funding outreach and enrollment assistance. There is strong evidence that investments in marketplace advertising and consumer assistance can reduce premiums by broadening the risk pool and bringing in more healthy uninsured enrollees. Yet under the Trump administration, there have been dramatic cuts to these efforts. Because a modest federal outlay could improve premium affordability, House leaders may well push a funding boost for ACA marketing and outreach.
  • Improving marketplace subsidies. The new House leadership is also more likely to consider bills that would enhance the ACA’s premium and cost-sharing subsidies. Some proposals target those who earn too much for ACA subsidies by capping the amount families need to contribute to premiums, regardless of their income. Others would also direct dollars to minimizing the “cliffs” that currently exist in the ACA’s sliding income scale for subsidy eligibility, particularly for those above 250 percent of the federal poverty line. These proposals are likely to be tougher sells with the GOP-dominated Senate, but would do much to address the problems many people have affording coverage.

Protecting people with pre-existing conditions

Senate Majority Leader McConnell has already conceded that another effort to repeal the ACA is not in the cards next year, thanks to the House takeover. However, the Trump administration has pursued a number of policies that have made health insurance less affordable for people with health needs. These include the encouragement of short-term and association health plans, the emergence of which raises premiums for ACA-compliant coverage, and the Department of Justice’s arguments in a Texas federal court that the ACA’s provisions protecting people with pre-existing conditions from insurance company discrimination should be invalidated. Under new leadership, the U.S. House is likely to resist any further administrative attempts to roll back the ACA’s protections. The House also could seek to intervene in the Texas litigation and argue to uphold the law.

Looking under the Hood: Congressional Oversight

To date there has been minimal, if any, Congressional oversight of the Trump administration’s operation of the ACA’s marketplaces and enforcement of its insurance reforms. That is likely to change under the new House leadership. We can expect that multiple House committees – Oversight & Government Reform, Energy & Commerce, Ways & Means, and Education & Labor – will soon be asking a lot of questions of – and requesting a lot of documents from – the agencies charged with administering the law. Secretaries Azar and Acosta and CMS administrator Seema Verma, in particular, may want to brace themselves for numerous appearances before these committees.

One thought on “What Does the Change in House Leadership Mean for Private Health Insurance? CHIR Experts Make Some Predictions

  1. Excellent summary. Regarding the fixing of the family glitch, I don’t know how you can get much cheaper than $6.5 billion a year in federal health policy. That is about three days worth of Medicare spending.
    But when it comes to helping lower income workers, nickels are like manhole covers.

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