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Throughout his first campaign ad for the U.S. Senate race against Kay Hagan, Thom Tillis wears an Autism Speaks lapel pin. Autism Speaks is an important science and advocacy organization that is active nationally and in North Carolina.

One of the organization’s top legislative priorities is enacting a law that requires insurance companies to cover treatments for Autism Spectrum Disorders. In 2013 the autism community passed such a bill through the House with 105 votes in favor of the requirement and 7 against.

This will likely set up a showdown with the National Federation of Independent Business. Last month the NFIB asked the Joint Study Committee on the Affordable Care Act to pass legislation prohibiting the introduction of new insurance mandates in North Carolina for some period of time. The committee, acting with great haste, agreed to discuss this NFIB bill at a May 13 meeting. Coverage for Autism Spectrum Disorder is the only proposed insurance mandate eligible for consideration this year.

It would be jarring if Speaker Tillis touted his ties to the autism community in a campaign ad only to undermine the central policy push of Autism Speaks in his chamber. We will soon find out whether or not his commitment is bigger than a pin.

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Politicians and members of the press are keenly interested in premium rates for Affordable Care Act Marketplace plans next year. Lawmakers want to use insurance prices as a cudgel on the campaign trail and the media knows that talk of premium spikes will attract attention.

That’s why reporters were interested in the announced enrollment statistics for Blue Cross and Blue Shield of North Carolina on Friday. The resulting coverage noted that BCBSNC enrollees were older and sicker than the company expected. In the race to make political hay out of these numbers there are a few points to keep in mind.

First, approximately 91 percent of ACA plan enrollees in the state receive a subsidy to purchase coverage. For this population premiums are capped as a percent of income. If, for example, you earn 150 percent of the federal poverty level then you will need to pay 4 percent of your household income for an ACA plan regardless of how premiums behave. Unless your income changes, you will pay the same rate next year.

Second, an older risk pool is not a major driver of premiums. Insurance companies certainly need younger and healthier enrollees to balance out payments for customers who use a lot of medical services. Still, as Kaiser Family Foundation has pointed out, even if insurers miss the mark substantially, this less healthy risk pool will only have a 1 or 2 percent impact on premiums. The primary drivers of premiums continue to be underlying medical costs and negotiated payment rates to providers.

Third, insurance companies have an interest in talking up their bad risk and steep medical costs. Insurance companies are, after all, companies. They want to set rates as high as the market will allow yet they also have to justify premium hikes to regulators. So, if they begin preparing the public for large premium increases the companies can then blame older and sicker enrollees for the requested boost in rates. Insurers also use the poor risk pool when negotiating with hospitals to explain cuts in payments for certain services. This is not to impute ill will to the insurance companies. It’s just how the game is played.

The risk pool mix, premium increases, and changing medical costs are all critical policy issues. We must restrain the rise in health care costs because, in the end, we all pay for our unnecessarily overpriced system. But when you hear that ACA Marketplace premiums will increase next year keep this context in mind.

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As we reported last week nearly 360,000 people have enrolled in health insurance plans through the federal Marketplace established by the Affordable Care Act in North Carolina. According to the federal data, 91 percent of these enrollees will receive financial help to pay their premiums.

Although impressive, this top line number does not tell the full story.

The fact sheets released by Health & Human Services also show that 74 percent of North Carolinians purchasing coverage through the Marketplace chose a Silver plan. As many people now know, insurance plans were listed on the federal website according to metal levels. These metal levels correspond to different cost sharing requirements. So an insurance policy that pays about 60 percent of costs is rated “Bronze,” and a plan that pays out 70 percent of costs is ranked as a “Silver” policy.

For individuals and families earning less than 250 percent of federal poverty level, about $58,000 for a family of four, Silver plans provide additional financial assistance by capping deductibles and co-insurance. That means the federal government will not only help with premiums, it will also ensure that families are not left with financially catastrophic deductibles.

The high rate of enrollment in Silver plans should be some comfort to physicians and hospitals that worried about patients facing unaffordable deductibles.

North Carolina’s robust enrollment figures, and the demographics of the enrollees, are good news for the stability of the state’s insurance market. Navigators, health insurance agents and brokers, providers and insurance companies all played a major part in driving consumers to the Affordable Care Act Marketplace. The state’s largest insurer, Blue Cross and Blue Shield of North Carolina, had a lot at stake.

BCBSNC was the only company to offer plans in every county. Weak enrollment would have meant a small pool of customers for the insurance company. With a modest customer base a few sick enrollees could drive up premiums for everyone. A large number of enrollees, on the other hand, means more stable and predictable costs for the company and should moderate premium hikes when new rates are released later this year.

There is also a good age mix among enrollees through the Marketplace in North Carolina. Insurers and analysts often draw arbitrary lines when setting age targets for enrollment. But, generally, younger people use fewer health services so insurance companies need them to offset the older folks to create a balanced pool of customers. Oftentimes analysts look at the percentage of enrollees younger than 35.

In North Carolina, 35 percent of enrollees are younger than 35. Also, 54 percent of enrollees are under the age of 45, what some may consider roughly middle aged.

So what is the bottom line from these figures? Obamacare will not, as critics charged, collapse under its own weight or create what some in the insurance industry call a “death spiral.” In fact, more insurance companies may see the success we’ve had in North Carolina and get into the market.

Also, it is critical to remember that those calling for the repeal of health reform are trying to transport us back to the bad old days when pregnancy was a pre-existing condition and insurance companies could deny coverage to uninsured customers for a broad range of reasons.

Instead of attempting to take coverage from 360,000 North Carolinians legislators should work to improve a law that is already working in our state.

 

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Sen. Richard Burr has an idea: maybe it’s time to reform our health insurance system. We could set up state-based marketplaces, give tax credits to purchase private insurance, and create some new protections for people with pre-existing conditions. But first we need to repeal the Affordable Care Act because it sets up state-based marketplaces, gives tax credits to purchase private insurance, and creates some new protections for people with pre-existing conditions.

The fact that Sen. Burr’s proposal is a watered down version of Obamacare is not its most entertaining feature. Partisan opponents of the Affordable Care Act have spent several years introducing alternatives to health reform that are just less workable variations of the law the nation has spent the past three years implementing.

What is most entertaining about Sen. Burr’s new proposal is what it says about prevention. Although the Affordable Care Act is one of the largest, most comprehensive investments ever made in prevention, it was not enough for Sen. Burr. In debates and news interviews he constantly harped on the lack of investment in prevention as the primary driver of his opposition to the ACA. In fact, he introduced an ACA alternative in 2009 called the Patients’ Choice Act. Title I of that act is “Investing in Prevention”. Prevention, after all, is the key.

What, then, does this new proposal, called “The Patient Choice, Affordability, Responsibility, and Empowerment Act,” have to say about prevention? Nothing, nothing at all. In the detailed summary of the bill there is no mention of prevention. So, Sen. Burr is now proposing that we throw away a unprecedented, large-scale prevention effort currently underway and replace it with nothing.

It’s easy enough to laugh off these public relations stunts. Even Sen. Burr has admitted that repeal is unlikely. It’s even less likely now that millions of people are enrolled in ACA plans and are receiving tax credits. But it’s sad that this is what passes for legislating nowadays. There are things that need fixing in health reform. Legislators should get to work and stop trying to strip away protections for American consumers.