Gov. Kemp Submits Bid To Remake Health Insurance Market

Georgia’s Republican governor on Monday submitted twin plans requesting that President Donald Trump’s administration allow changes to federal government subsidies for health insurance.

Gov. Brian Kemp said proposed changes to former President Barack Obama’s Affordable Care Act would give individuals and families less expensive coverage options, a particular benefit for those who don’t qualify for federal subsidies to cover premiums.

“They’re going to work to reduce costs, make health care more accessible and have better quality in our state,” Kemp said in a statement.

Critics say it would drive up insurance costs for older and sicker people.

Kemp also wants to offer subsidized coverage to a fraction of Georgia’s uninsured poor if they worked or went to school for 80 or more hours a month. Kemp’s administration projects the expansion would cover 50,000 people, far less than the 400,000 uninsured Georgians who might be covered by the Medicaid expansion originally envisioned by the overhaul.

This second proposal, aimed at people earning incomes of up to 100% of the federal poverty level, echoes those made by other states. Federal officials have rejected some similar partial expansions.

But it’s the first plan, under which Georgia would take over the federal insurance marketplace and the associated funding that goes with it, that’s drawing national notice. The state would make those federal subsidies available to people who buy health plans that don’t provide the full array of benefits that the Affordable Care Act requires.

Passed in 2010, Obama’s signature health care law extended insurance coverage to millions of Americans by expanding Medicaid and subsidizing premiums for individuals and families who make up to four times the federal poverty level. The law — also known as “Obamacare” — allows states to seek waivers from the federal government to change certain provisions, but only if they adhere to strict rules.

The Trump administration has loosened those rules, and Kemp’s plan includes three approaches promoted by the federal Centers for Medicare and Medicaid Services in November 2018.

Health policy experts say that change would drive up ACA premiums by drawing healthier people to less expensive, skimpier insurance plans. That would leave the ACA with a sicker patient pool.

Under Kemp’s plan, Georgia residents would be required to bypass the central HealthCare.gov website to sign up for insurance. Instead, the state would redirect them to a list of approved brokers and insurers where consumers would be able to compare ACA-compliant plans side by side with plans that don’t meet ACA requirements.

All plans would have to continue covering preexisting conditions.

In addition to the current gold, silver and bronze level plans, Georgia would let insurers offer a new lower tier of benefits, called copper level, which would cover only about half the cost of projected expenses. The current lowest level of bronze covers about 60% of costs. The state says copper level premiums are expected to be 17% lower than bronze level premiums, on average.

Georgia also would let insurers offer disease management plans aimed at helping patients manage a particular high-cost disease such as diabetes or HIV and AIDS.

State officials would set an overall cap on its own subsidies at $255 million. There is no cap under the ACA, although the state doesn’t project its spending will come anywhere near the cap, even though it projects enrollment will increase by more than 37,000.

The governor’s office estimates that the availability of subsidies for pared-down health plans would only increase “Obamacare” premiums by a little more than 1%. State officials say that amount would be more than offset by its intention to pay a portion of insurance companies’ costs to treat their sickest patients, a relatively small group that incurs the biggest bills. The so-called reinsurance program would allow the companies to lower monthly premiums for all customers.

Twelve other states have received approval for reinsurance programs, according to data from the Kaiser Family Foundation.

State officials expect to hear by August whether Georgia has permission to implement its plans.