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As Trump attacks the federal health law, some states try to shore it up

Christine Vestal, Stateline.org on

Published in Health & Fitness

The federal tax overhaul enacted in December repealed the individual mandate, which required everybody to have health insurance or pay a financial penalty. The requirement was designed to ensure that healthy people signed up for insurance so that premiums for everyone remained affordable.

Two months earlier, President Donald Trump withdrew billions in federal insurance industry subsidies that allowed insurers to keep premiums affordable while holding down copays and deductibles.

Around the same time, Trump also cut the health exchange enrollment period in half. And earlier in the year, he slashed the marketing budget for federal exchanges to further damage the health law by curtailing enrollment.

This year, both branches of government promise further attacks on the health law, including final actions on two administration proposals. One would encourage insurers to offer short-term policies with variable copays and deductibles, and the other would allow people to form groups to create so-called association health plans with cheap premiums and limited benefits.

In Idaho, Republican Gov. Butch Otter followed the administration's cues, signing an executive order last month that directs the state insurance agency to draft rules allowing insurance companies to offer cheap plans with stripped-down benefits.

Going in the opposite direction, California, Connecticut, the District of Columbia and Maryland are considering legislation that would recreate the Affordable Care Act's individual mandate by requiring nearly all residents to enroll in a health plan or pay a fee. Massachusetts has a mandate on the books that it said it intends to enforce.

 

Taking a different tack -- one that has been endorsed by members of both political parties -- Alaska, Minnesota and Oregon have created so-called reinsurance programs designed to cover higher-than-average claims with state money and thereby reduce overall risk for insurance companies so they can offer consumers lower premiums.

Under the health law, the federal government can reimburse states for any money spent on reinsurance programs that results in lower premiums, and thus reduced federal tax subsidies, as long as the reimbursements do not exceed federal savings. Washington state and Wisconsin are considering similar programs this year.

In New Jersey, newly elected Democratic Gov. Phil Murphy signed an executive order in January directing state agencies to invest in greater outreach and education to encourage more people to sign up for coverage on the state insurance exchange when it opens in November. California and New York launched similar advertising and marketing campaigns last year for the same reason.

By encouraging more people to enroll, states can improve the odds that their insurance markets will stabilize and premiums will remain affordable.

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