Officials Looking at Ways to Stabilize Costs in the Affordable Care Act Marketplace

There’s a lot of legislative debates going on in the country these days, but there’s one thing that politicians across party lines can agree upon: universal healthcare is important. However, legislators differ on how to implement such a wide-reaching program.

Should the country’s universal healthcare system be replaced or tweaked? This is the biggest question lingering over this landmark legislation, the legacy of Former President Barack Obama.

One of the biggest challenges faced by the program today is the soaring costs of buying insurance in the Affordable Care Act marketplace in some states. While the ultimate fate of the ACA hangs in the balance, officials are trying to find ways to tweak its current shortcomings.

When Healthy People Don’t Sign Up, They Can Skew the Price of Coverage

Convince the Young and Healthy to Get Coverage

To be young is to be invincible. At least, that’s the mindset of many young adults in the country, which is why a sizable chunk of this demographic don’t purchase insurance. The problem is that the insurance industry, by its very nature, relies on shared risk. The young and healthy are supposed to subsidize the healthcare costs of the sick and elderly. But if the former don’t get coverage, the pool of insured individuals will tend to be older people, who are more likely to get sick and often require costlier care. This skews the pricing of policies, making them more expensive.

That’s why Iowa Insurance Commissioner Doug Ommen is suggesting a stopgap measure: tax credits. According to his plan, offering additional tax incentives will reel in more young enrollees to the marketplace, thereby stabilizing the costs. However, it is important to note that this motion needs to be approved first by the federal Centers for Medicare and Medicaid Services.

Democrats Offer Their Suggestions

Recently, Senate Majority Leader Mitch McConnell of Kentucky said that a limited healthcare bill could be needed in order to stabilize insurance marketplace prices. Seemingly in response to this comment, 10 house democrats have unveiled a five-part plan to address this very matter.

First off, the legislators suggest creating a dedicated $15 billion reinsurance fund, that will help keep costs down should policyholders find that they need more healthcare than their current plan can provide.

Second, they propose that Congress double down on the cost sharing reduction (CSR) payments, which helps reduce copays and deductibles for lower income families in the country.

Third, they propose to resume the marketing for the marketplace enrollment period, which has been stalled since January. It’s been shown that enrollment rates are higher in states with a robust marketing strategy, and that it attracts healthy policy buyers who help stabilize costs.

Fourth, create more affordable options for Americans, whether it be through expansion of Medicare for the indigent, or ensuring the flexibility of health savings accounts (HSAs).

Fifth, providing technical changes and improvements, such aligning the enrollment period with tax season, or making the marketplace more inclusive especially in rural areas.

Eligibility assistance matters, too

Of course, enrolling in the marketplace may be an intimidating experience for many enrollees. As such, they may choose not to enroll in the program, even if they are healthy and thus are entitled to lower premiums. Fortunately, there are companies like DECO that walk applicants through the entire process so that they can get the coverage they need, at the quickest possible time, and at the lowest cost.

As a country implementing its first universal healthcare law, America is still in the “growing pains” stage of the Affordable Care Act, where strengths and weaknesses are still being uncovered. That being said, there are already steps being taken to help address the shortcomings present in the current model, so that costs are kept under control without compromising quality of care.

Sources
Ten House Democrats unveil plan to stabilize & improve the individual marketplace, StateOfReform.com
Affordable Care Act fix, TheGazette.com

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Categories: Affordable Care Act