Some Health Insurers Bail On States Citing Trump-Fueled Uncertainty

President Donald Trump give the thumbs-up as he walks from Marine One across the South Lawn of the White House in Washington, Wednesday, Sept. 27, 2017, as he returns from Indianapolis. (AP Photo/Carolyn Kaster)

On Wednesday’s deadline for insurance companies to submit their individual market rates to the federal government, North Dakota lost one of its three remaining companies. Citing “the uncertainty that currently exists around cost-sharing reductions,” the state’s insurance commission announced Thursday that the insurer Medica quit the state’s market, leaving just two options for consumers in North Dakota.

The Trump administration has for months publicly toyed with the idea of cutting off the billions in cost-sharing reductions (CSRs) paid to insurers who cover low-income people with severe health needs, but has so far made each monthly installment.

North Dakota Insurance Commissioner Jon Godfread said in a statement Thursday that Medica at first filed insurance rates assuming that the government would make the payments, and later submitted high rates assuming Trump would pull the plug on the subsidies. When the state rejected those higher rates, Medica quit the market.

The same Trump-fueled uncertainty triggered another major exit this week, with Anthem leaving Maine’s exchange.

“A stable insurance market is dependent on products that create value for consumers through the broad spreading of risk and a known set of conditions upon which rates can be developed,” Anthem spokesman Colin Manning said in a statement. “Today, planning and pricing for ACA-compliant health plans has become increasingly difficult.”

Congress is currently crafting a bill that would take the power to cut off CSRs out of Trump’s hands, guaranteeing a year or more of the funding and giving the individual market more stability. But negotiations stalled when Republicans prioritized taking another failed run at repealing Obamacare, and their success remains uncertain.

With the power to unilaterally cut off the subsides still in the hands of the administration, insurance companies and their customers have grounds to be skittish.

Sen. Lindsey Graham (R-SC), who met with President Donald Trump on Thursday to discuss health care, told TPM when he returned that the White House signaled its displeasure with continuing CSRs.

“The president really has a hard time writing checks to a failing program, doing something he thinks is outside the law,” he said. “I came away thinking that the president is not going to continue this practice forever. He’s not going to keep throwing good money after bad. He was in the mindset, to me, that these payments are a problem, but he wants to see what the market will bear.”

The non-partisan Congressional Budget Office calculated in August that cutting off CSRs would trigger premium increases of up to 25 percent over two years.

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