Governors’ health care plan urges stabilizing markets, endorsed by Sandoval

By Julie Carr Smyth and James Anderson, Associated Press

Published Thursday, Aug. 31, 2017 | 10:02 a.m.

Updated Thursday, Aug. 31, 2017 | 1:41 p.m.

COLUMBUS, Ohio — A bipartisan governor duo is urging Congress to retain the federal health care law's unpopular individual mandate while seeking to stabilize individual insurance markets as legislators continue work on a long-term replacement law.

The recommendation is part of a compromise plan that's designed to be palatable to both parties. It was endorsed by six other governors.

Ohio Gov. John Kasich, a Republican, and Colorado Gov. John Hickenlooper, a Democrat, shared their plan in a letter to congressional leaders Thursday. They acknowledge retaining the mandate may be a difficult sell for Congress, which has failed so far to pass a replacement health care bill.

"The current mandate is unpopular, but for the time being it is perhaps the most important incentive for healthy people to enroll in coverage," they wrote to House and Senate leaders of both parties. Experts concur that keeping younger, healthier people in the insurance pool protects against costs ballooning out of control.

The letter was signed by the governors of Alaska, Louisiana, Montana, Nevada, Pennsylvania and Virginia.

Kasich and Hickenlooper also recommend that President Donald Trump commit to cost-sharing reduction payments to insurers and that Congress fund those offsets at least through 2019. Those payments reimburse insurers for providing low-income people with legally required reductions on copays and deductibles. If Trump follows through on threats to pull the plug, premiums would jump about 20 percent.

The governors note that the National Governors Association, U.S. Chamber of Commerce and National Association of Insurance Commissioners all have identified the payments as "an urgent necessity."

Gov. Brian Sandoval said in a statement that he’s committed to protecting coverage for residents benefiting from the Medicaid expansion and Silver State Health Insurance Exchange.

“Holding states harmless should be a priority as Congress continues to debate federal healthcare policies,” he said. “This letter is aligned with these two priorities and I am proud to be a part of a coalition of bipartisan Governors who are working to bring forward solutions that will help stabilize our healthcare market so more Americans can live healthier, happier lives.”

The governors support creating a temporary stability fund that states could tap to reduce premiums and limit losses; continuing to fund educational outreach and enrollment efforts under the Affordable Care Act; exempting insurers that agree to cover underserved counties from the federal health insurance tax; and supporting states' efforts to find creative solutions for covering the uninsured.

The governors said states can pursue lots of options without federal assistance, but in some cases they are "constrained by federal law and regulation from being truly innovative."

The letter reflects many of the recommendations officials in divisions of insurance and state-based marketplaces across the country have been making for months, said Heather Korbulic, executive director of the Silver State Health Insurance Exchange.

“These governors are listening to health policy people and taking seriously their obligations to stabilize marketplaces and trying to put together some kind of package of proposed ideas to do just that,” she said.

Carriers built discounts into certain rates for qualifying patients under the expectation that the federal government would follow through on making these payments. President Donald Trump has called these cost-sharing reductions “bailouts.”

Korbulic said enforcing the individual mandate and funding cost-sharing reductions in the long-term rather than month-to-month will help stabilize the marketplace and prices.

“We really want to see some assurances about cost-sharing reductions,” she said. “We recognize the importance of the individual mandate in driving young, healthier bodies into the risk pool.”

She said Sandoval’s letter and conversations going on in the Senate health committee are both indicators of bipartisan work to solve the country’s health care issues. This is a shift from GOP-led efforts that led to failed or pulled options to repeal and replace Obamacare.

“This is a really good bipartisan effort to start supporting the existing infrastructure of the Affordable Care Act,” she said.

After Republicans' failure to pass a replacement of President Barack Obama's health care law, Kasich and Hickenlooper teamed up to push for health care exchanges that would stabilize the market and assure affordability. Both took pains to quash speculation that their collaboration and public appearances suggested a bipartisan presidential ticket was in the making for 2020.

Kasich ran for the GOP presidential nomination won by Trump and has not ruled out another run; Hickenlooper was considered a possible running mate for Democrat Hillary Clinton last year.

They are expected to be in Washington next week to testify on their proposal. But congressional action on even a modest compromise is expected to be difficult following years of harsh partisan battling over the Republican drive to dismantle the health care law.

The Sun’s Yvonne Gonzalez contributed to this report.