What’s a State to Do? A New Series Helps States Navigate a Rapidly-Changing Federal Landscape

Introduction by NASHP Executive Director Trish Riley

In a period of change and uncertainty at the federal level, states are on the front line, searching for firm footing and clear direction as they responsibly steward their public programs, protect their consumers, and balance state budgets.

  • When the federal government stopped funding cost sharing reductions (CSR) for the individual Marketplace, eligible consumers could no longer get help paying out-of-pocket costs required as part of their health insurance coverage. In response, most state insurance regulators and state-based marketplaces negotiated work-arounds with their issuers to make sure consumers continued to receive help paying those costs.
  • Federal funds for the Children’s Health Insurance Program (CHIP) were not renewed on Sept. 30, 2017, but states – aided by redistributed funds from the Centers for Medicare & Medicaid — are keeping their programs open as long as possible despite uncertainty about when and whether funds will be provided.

Today, as the tax bill appears headed to repeal the individual mandate, states will lose a tool that is critical to sustaining a more robust individual insurance market. By encouraging all to procure coverage, risk was spread among both the healthy and the sick, which kept a check on premium growth. Two Congressional proposals – the Cassidy-Murray insurance stabilization bill and the Collins-Nelson reinsurance bill — propose short-term stabilization strategies to preserve markets. But are these two limited, two-year appropriations that fund CSRs and reinsurance enough to stabilize markets and offset the impact of the loss of the mandate?

Amid this uncertainty, states await the imminent release of proposed federal rules that would expand the use of short-term policies and provide for association health plans. How might those changes impact the individual markets in states, and how will state officials make sure they have the information and analysis needed to address new opportunities and challenges that are fast emerging?

Today, the National Academy for State Health Policy (NASHP) launches a series, What’s a State to Do? with State Options to Protect Consumers and Stabilize the Market: Responding to President Trump’s Executive Order on Short-Term Health Plans, a policy analysis written by our colleague, Sabrina Corlette, of Georgetown University’s Center for Health Insurance Reforms. We are pleased to share her work and hope to continue these collaborations in the future.

States will make their own choices as they respond to these emerging opportunities for state flexibility, and we hope these columns will help states as they navigate these changes.