The Trump administration announced on Monday that they would release new regulations aimed at giving states more flexibility to offer cheaper plans on Obamacare’s exchanges next year which would ease the requirements on the health benefits that plans must cover as well as quality control, reports The Washington Examiner.
Critics of Trump and this regulation say that the new rule will allow insurers to charge higher prices and skirt patient protections.
The rule outlines how insurers can apply for plans sold on Obamacare’s exchanges in 2019. It contains several major changes aimed at allowing plans to offer more affordable options on the exchanges, according to the Centers for Medicare and Medicaid Services. The changes include new flexibility in how states cover essential health benefits and how much money insurers must devote to improving services.
“Too many Americans are facing skyrocketing premiums that they can’t afford, and every year consumers are faced with the threat of fewer choices,” said CMS Administrator Seema Verma. “This rule gives states new tools to stabilize their health insurance markets and empower citizens to find coverage that fits their families’ needs and budgets.”
Some of the major changes starting with plans in 2020 are how insurance plans on the exchanges cover essential health benefits. An insurance plan sold on Obamacare’s exchanges must cover 10 essential health plans, which include maternity care, hospitalization or mental health.
States currently must choose an essential health benchmark plan from among 10 plans operating in the state to define the benefits that must be covered by the state.
The Trump administration now will let a state choose a benchmark plan from another state, instead of a plan in its own state. That means a state can choose a plan that is less restrictive than one offered in their own state.
“It allows states more flexibility in allowing EHBs but the 10 essential health benefits still remain,” she said.
CMS also will eliminate a requirement that each plan offered on the exchange by an insurer offer key differences such as the benefits covered or cost sharing.
CMS said eliminating the requirement gives insurers “more flexibility in designing plans.”
The agency also is changing the requirements for how much money an insurer must provide toward medical services and quality improvement. Obamacare requires insurers to spend 80 percent of the money it takes in from premiums on health costs and quality improvements and 20 percent on administrative overhead or marketing.
CMS would allow a state to change that ratio based on certain factors.
“Specifically, the rule reduces quality improvement activity reporting burdens on insurers and allows states to request reasonable adjustments to the [medical loss ratio] standard for the individual market if the state shows a lower MLR standard could help stabilize its individual insurance market,” the agency said.
The new rules govern which plans insurers can provide on Obamacare’s insurance exchanges in 2019. Insurers have until June to decide if they want to offer plans on the exchanges.
Obamacare’s exchanges are on the individual insurance market, which is used by people who don’t have insurance through a job or the government.
Sen. Patty Murray, D-Wash., the top Democrat on the Senate Health, Education, Labor, and Pensions Committee, said the new rule is an end-run around Obamacare’s patient protections. She charged that the essential health benefit rule would “open the door” to less comprehensive coverage, and she criticized the flexibility for the medical loss ratio.
“With this new rule, President Trump has issued an open invitation for insurance companies to raise premiums, skirt patient protections, and undermine families’ care,” Murray said. “I’m very concerned about what these dramatic, harmful changes in policy could mean for women who don’t want to pay more than men for health care, for people with pre-existing conditions, for those struggling with mental illness and substance use, and for millions of people’s health costs.”