Md. to consider health insurance market’s present, future

A busy week is in store for health policy in Maryland as regulators, advocates, consumers and insurers consider the present and future of the state’s individual market.

Monday, the Maryland Insurance Administration will hear from insurers and the public as it decides where it will set premiums for the 2019 individual market. Tuesday, the Maryland Health Insurance Coverage Protection Commission will meet in Annapolis for the first time this year as it has been charged with figuring out how the state will navigate the individual market’s future.

The commission could be credited for helping to stabilize the market this year. It studied the proposal that eventually moved forward in the General Assembly to create a reinsurance program with the goal of reducing rates.

So far, that plan appears to have worked. CareFirst BlueCross Blue Shield and Kaiser Permanente, the two insurance companies with products on the individual market and Maryland, refiled previous rate requests this week with dramatically lower numbers. CareFirst is now asking for an average 22.3 percent decrease on its HMO product and Kaiser is asking for an average 5.7 percent decrease. CareFirst is also asking for an average 17.7 percent increase on its PPO product after initially requesting a 94 percent increase last May.

Now the Maryland Insurance Administration will take a look at those numbers and, working with the carriers, figure out what rates should be for 2019.

Beth Sammis, president of Consumer Health First, will have some suggestions at Monday’s hearing. Looking deeper at the numbers the carriers have filed, Sammis found that all three products account for reinsurance at different rates. And depending on a potential buyer’s age and the product they are looking to buy, the change in rates may not match the averages.

“It’s overall good news but it just kind of reiterates the point that it depends on what you were buying before, and consumers need to look carefully at their options and consider all of the options available to them,” Sammis said.

The reinsurance program will be funded by a state tax on health insurers that would have ordinarily been assessed federally but was set aside in last year’s tax legislation. It creates an estimated $380 million pool that should help the state run its reinsurance program for the next three-to-five years.

But most stakeholders, including Gov. Larry Hogan when he announced the federal government’s approval of the reinsurance program last month, admit the fix is temporary until a more permanent solution for escalating premiums can be found.

The health insurance commission will once again take up the mantle of finding solutions to Maryland’s health care system, both near term and into the future.

One leading proposal, which received serious consideration during this year’s session of the General Assembly, will be the creation of a state individual mandate to replace the federal penalty that was zeroed out in last year’s tax law. The proposal would not just recreate the federal penalty, but allow people to use it as a down payment on their own insurance instead.

“The one great thing about health insurance down payment is we don’t require any federal approval,” said Vincent DeMarco, president of the Maryland Citizens’ Health Initiative, said. “They can just do it. Some of the other proposals … would require federal waivers. I think that it’s very important to say that Maryland should do what we can do.”

His organization estimates that 60,000 more Marylanders could get access to health insurance through the proposal.

Sammis agreed that Maryland will need a state mandate. But she also believes more must be done to entice people who make more than 400 percent of the federal poverty level into the market. Right now, they do not receive any subsidies and can be priced out of buying insurance.

She said the best solution may be for the state to create a public option to sell insurance to this group of people, using the existing administrative infrastructure set up for Medicare.

“We need start thinking about these individuals who are over 400 percent (of the poverty level) and figure out a way to make it affordable for them so they stay in the market, whether or not they are healthy or unhealthy,” she said. “I don’t see any way to do it other than a public option. (The private market) is just not going to be sustainable for this population.”

But those longer solutions — other proposals studied will include universal health care models, merging the individual and small group markets and a basic health plan — could take several sessions to gain approval in the state legislature.