NASHVILLE — As the health care debate heats back up in the nation’s capital, the administration of Tennessee Governor Bill Haslam is taking a stance that could put it at odds with the administration of President Donald J. Trump.
Tennessee Department of Insurance Commissioner Julie Mix McPeak testified before the U.S. Senate’s health committee that cost-sharing reductions is the “single most critical issue” to help stabilize the insurance marketplace. Trump has threatened to cut that funding.
McPeak, who famously said last year that the Obamacare marketplace is “on the verge of collapse” in Tennessee was testifying before a bipartisan committee that was orchestrated in part by Sen. Lamar Alexander, R-Tenn. She refuted claims made by Trump and some Republicans that the cost-sharing reductions amount to bailouts for insurance companies.
“To be clear, this issue is not an ‘insurer bailout,’” McPeak said. “CSR funding ensure that some of our most vulnerable consumers receive assistance for co-pays and deductibles.”
Experts say that ending the cost-sharing reductions would cause premiums to skyrocket, which would in turn cause more people to stop purchasing insurance on the marketplace. Some Democrats have alleged that Trump has threatened to stop the cost-sharing reductions as a way to sabotage the Affordable Care Act since Congress failed to repeal it earlier this year.
Even Haslam, another Republican, testified before senators last week that ending CSR funding would drive up costs.
“Failure to fund CSR payments will increase premiums significantly for our citizens, create even more uncertainty around the future of participating carriers and, according to the Congressional Budget Office, actually increase the federal deficit due to higher premium tax cuts. Clearly, this is not a recipe for success,” Haslam said.
He was referring to a CBO report last month that estimated the deficit would increase by $6 billion if CSR funding is eliminated.
The battle over CSR funding dates back to 2016. The Republican-controlled House of Representatives challenged the funding in court, saying that those payments by the federal government are illegal because they were not appropriated by Congress when Obamacare was adopted.
The House won an early legal victory when a judge issued an opinion that CSR funding is, indeed, illegal. The Obama administration appealed that decision, and the Trump administration has not dropped that appeal. By threatening to cut CSR funding, Trump is suggesting that his administration would drop the court appeal and allow the lower court’s ruling to stand.
That hasn't happened, perhaps due in part to a separate court ruling earlier this year. In May, a court ruled that 15 states and the District of Columbia can continue an appeal without the Trump administration, saying that ending CSR funding would be detrimental to the citizens of those states.
Tennessee was not among the group of 15 states, though neighboring Kentucky was.
While McPeak and Haslam said that ending CSR funding would be detrimental to Tennesseans who are not offered health insurance by their employer and purchase coverage privately through the marketplace, Haslam also pointed out that continuing CSR funding is not a fix for the marketplace, which has teetered on the verge of collapse in the Volunteer State.
“It’s also very important to understand that our marketplace was facing collapse before this discussion of CSR payments, and other actions and reforms will be needed to address the crisis.”
While Haslam is opposed to putting a stop to the CSR funding, he also stated his opposition to rising costs associated with the health care debate.
“During all of the debate about the Affordable Care Act, there has been a lot written and said about how immoral it would be to have millions of people lose health insurance coverage,” Haslam said. “However, can’t we all acknowledge that it is just as morally questionable to cover everyone with health insurance and put the bill on a credit card to be paid by our grandchildren and not do everything we can to make health care affordable?”
Alexander was scorned by conservatives earlier this year when he voted against repealing Obamacare, but he has also stated his support for repealing and replacing the law. As chairman of the Senate’s health committee, he vowed to keep the conversation about health care alive after Congress failed to pass legislation to address it earlier this year.
At last week’s hearings, he said the subject of health care has been a prisoner in a “partisan stalemate for seven years,” and said fixing the problem will require a bipartisan approach.
“To get a result, Democrats will have to agree on something, more flexibility for states, that some may be reluctant to support. And Republicans will have to agree to something, additional funding through the Affordable Care Act, that some may be reluctant to support,” Alexander said.