Obamacare insurance markets open this week, but there’s still confusion and uncertainty

Reporting from Washington —  Health insurance marketplaces created by the Affordable Care Act begin accepting 2018 applications Wednesday amid mounting concern that the Trump administration’s repeated attacks on the law will dramatically depress enrollment.

The marketplaces -- a centerpiece of the law commonly called Obamacare -- continue to provide coverage for some 10 million people. And they remain the only option for many low- and moderate-income Americans who don’t get health benefits through an employer or a government program such as Medicare or Medicaid.

But across the country, the president’s persistent criticism of the law and Republican congressional efforts to repeal it have fed widespread confusion among consumers.

“Most people think the plans are gone,” said Katy Caldwell, executive director of Legacy Community Health, a large network of clinics serving low-income patients in and around Houston.

Caldwell said patients routinely now say they are expecting to be uninsured in 2018. “We’re afraid people think they can’t enroll next year,” she said.

In one recent national survey, more than 40% of uninsured working-age adults were either unsure or unaware that the requirement that people have insurance is still in effect, the nonprofit Kaiser Family Foundation found. Americans who do not have coverage may be subject to a tax penalty.

The Trump administration has at times appeared intent on stoking the uncertainty.

Two weeks ago, the president publicly suggested the healthcare law had already been repealed.

“Obamacare is finished. It’s dead. It’s gone,” Trump said at a mid-October Cabinet meeting. “There is no such thing as Obamacare anymore.”

The president’s comments followed a series of moves that many state regulators, consumer advocates and health insurers say are undermining the markets.

Trump in October abruptly cut off federal payments that reimburse insurers for reducing out-of-pocket costs for lower-income Americans.

The so-called cost sharing reduction payments are the subject of a legal battle, with congressional Republicans arguing they cannot be paid without an appropriation by Congress.

But the Trump administration’s decision to suddenly back the legal challenge after nearly a year of making the payments drew widespread criticism, especially coming so close to the 2018 open enrollment period.

And although a bipartisan group of senators has proposed legislation to fund the payments and stabilize markets, Trump has signaled he may not sign it.

Uncertainty over the payments has prompted many insurers to significantly raise their 2018 rates, in some cases by as much as 30%, according to a recent Kaiser Family Foundation analysis.

Many consumers will be protected from these rate hikes, in part because of premium subsidies provided through the healthcare law.

The law offers aid to consumers making between 100% and 400% of the federal poverty line, or between $12,060 and $48,240 a year.

Many insurers also concentrated the rate hikes in certain plans. Because of the complex way the law calculates subsidies, that means that some consumers could actually see their rates decline next year.

But Americans who make too much to qualify for aid – many of whom have already experienced big premium hikes in recent years -- may see very large rate hikes again in 2018.

That could force some to drop coverage, weakening the markets further in some parts of the country.

Trump also roiled markets in October by directing federal agencies to look at ways to broaden the availability of cheaper, less comprehensive health plans which could leave only sicker, more expensive consumers behind in the marketplaces.

Trump’s moves came on top of dramatic budget cuts by the Department of Health and Human Services for enrollment efforts this year, slashing advertising by 90% and reducing federal funding for organizations that help people sign up by more than 40%.

At the same time, this year’s enrollment period – which runs from Nov. 1 to Dec. 15 – will be half as long as prior enrollment periods for residents of the 39 states that use the federal HealthCare.gov marketplace.

Most state-run marketplaces, including California’s and Connecticut’s, plan to keep their enrollment periods open into January.

“This is like the invisible open enrollment,” said Peter Lee, executive director of Covered California, the state’s insurance marketplace. “That’s a prescription for low enrollment and bad risk.”

The marketplaces, which began offering health coverage in 2014, depend on attracting enough younger, healthier enrollees to offset the costs of older, sicker consumers. That helps keep premiums in check.

Getting that mix right was challenging before this year, as the Obama administration labored to convince younger consumers to sign up for coverage.

Some states, such as California, are again planning robust new outreach efforts for 2018.

And some health insurers will increase marketing efforts this year, said Jeanette Thornton, senior vice president at America’s Health Insurance Plans, the industry’s Washington-based lobbying arm.

But the Trump administration has no major plan to promote enrollment this year and has done little to coordinate with grass roots groups that help people sign up for health plans, according to several leading groups.

“There are still a lot of people who want the coverage,” said Jodi Ray, who oversees enrollment efforts for Florida Covering Kids and Families, a nonprofit that has helped Floridians sign up for health insurance since the marketplaces opened four years ago.

Federal officials have said they don’t believe such a federal effort is necessary, as the marketplaces are now entering their fifth year.

That’s unfortunate, Lee said. California officials concluded that ongoing outreach and advertising is crucial because there is so much turnover in the marketplaces as consumers leave to get coverage elsewhere after getting a job or qualifying for a government plan such as Medicare or Medicaid.

Ever year, about 40% of Covered California’s enrollees are new, Lee said. “There are always new people to reach.”

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@noamlevey

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