Georgia could be the first state to test multiple proposals from President Donald Trump that would dramatically change the market for insurance under the health care overhaul passed by his predecessor.
Supporters say the 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.
Critics say it would drive up insurance costs for older and sicker people.
Georgia Gov. Brian Kemp issued his plan, dubbed “Georgia Access,” in October. It includes three approaches promoted by the federal Centers for Medicare and Medicaid Services, or CMS, in November 2018.
State officials planned to submit a formal proposal to the Trump administration on Friday and expected to hear by August 2020 whether the state has permission to implement it.
Passed in 2010, the Affordable Care Act — 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 at the same time that they’re part of a legal battle to entirely overturn the ACA. The Trump administration has sided with mostly GOP-led states, including Georgia, that are arguing the whole health care law is unconstitutional, but it has also left the door open for judges to keep parts of it.
Under “Georgia Access,” the state would take charge of federal subsidies for “Obamacare” and make them available to people who buy health plans that don’t provide the full array of benefits that the ACA requires.
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.
“Essentially, Georgia is saying if you’re a healthier person who doesn’t need maternity care or mental health care, you get to win with these cheaper products, but if you’re a sicker person who needs comprehensive benefits you could face much higher premiums,” said Sabrina Corlette, co-director of the Center on Health Insurance Reforms at Georgetown University’s McCourt School of Public Policy.
Corlette said Georgia is the first state to attempt to implement many of the Trump administration’s 2018 proposals.
At a recent public hearing, Carey Mackesey worried about what effect “Georgia Access” would have on her daughter, who has cystic fibrosis.
The University of Georgia junior needs constant medical treatment that requires the family to have a robust health insurance plan with a premium that has already climbed to $2,000 a month, Mackesey said. She spoke on behalf of the Georgia chapter of the Cystic Fibrosis Foundation.
She said subsidizing plans that don’t comply with the ACA’s requirement to provide full benefits could raise insurance costs for people with cystic fibrosis even higher.
“Each year, it has become more and more difficult to secure the services that my daughter needs to live,” Mackesey said.
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 percent. 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.
Under “Georgia Access,” residents would also be required to bypass the federal HealthCare.gov website to sign up for insurance. Instead, they would buy insurance directly from brokers or insurers on sites where they would be able to compare ACA plans side-by-side with plans that don’t meet ACA requirements.
All plans would have to continue covering preexisting conditions.
“Georgia Access” would “draw people into the market” by freeing them “from being forced to buy the kind of insurance that someone else a thousand miles away decided they needed,” said Kyle Wingfield, CEO of the Georgia Public Policy Foundation, a conservative think tank.
State officials would also set an overall cap on subsidies. There is no cap under the ACA.
“That doesn’t seem fair,” Georgia resident Susan Marling told state officials at the public hearing.
Marling, 55, suggested that Kemp look for ways to improve the ACA without “blowing up the system.”
The governor’s office says it has put enough money in its subsidy account to cover both the residents currently receiving federal aid and the additional 30,000 people expected to sign up for insurance.
Georgia officials say their proposals are responding to a bleak health care environment. Average premiums for some ACA health plans in the state have increased by more than 40 percent over the past two years, to nearly $7,500 a year, according to the governor’s office. Enrollment in ACA plans in Georgia has declined by 22 percent since 2016 and now stands at nearly 460,000 people.
Kemp said in a recent op-ed that “Georgia Access” would give families “more choices to ensure optimal coverage at the right price.”