New Jersey is in a good place heading into the 2019 Affordable Care Act marketplace, experts say, but upheaval on the federal level is causing some bumps along the way.
State insurers are expected this month to determine how much residents who get health care coverage through the ACA should pay for their plans in 2019, but a recent disruption by President Donald Trump’s administration on payments that have helped stabilize the market is causing delays.
The White House announced earlier this month that billions of dollars in payments under the ACA’s risk-adjustment program will be put on hold.
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“There’s no question that federal actions have an impact on all states, and New Jersey is not immune to that,” said Ward Sanders, president of the New Jersey Association of Health Plans.
Under the program, the government transfers funding from insurer plans with low-risk, or healthy, enrollees to insurers with a lot of high-risk, or sick, enrollees to help even out the marketplace.
The freeze on those payments comes at a crucial time when insurers try to calculate what they should charge customers next year. Nearly 275,000 New Jersey residents selected Obamacare plans on the federal exchange during last year’s enrollment period, according to the U.S. Centers for Medicare and Medicaid.
Sanders said as with any regulated industry, insurers look for clarity and certainty for guidance in making pricing decisions, and it has been a tumultuous period for understanding the market.
In response to the federal announcement, New Jersey Department of Banking and Insurance officials said they extended the deadline for insurers to file ACA plan rates by another week to July 18 because the decision to halt adjustment payments came just days before the state’s original deadline of July 11.
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“Despite actions taken at the federal level to undermine the Affordable Care Act, New Jersey is working aggressively to create stability in the market and to ensure that residents have access to affordable quality health care,” Banking and Insurance Commissioner Marlene Caride said in a statement.
The state’s insurance department told New Jersey Obamacare insurers, which this year included Horizon BlueCross BlueShield of New Jersey, AmeriHealth and Oscar, in a July 9 memo that they should calculate their plan rates, or premium prices, assuming the risk-adjustment payments will resume.
Despite the issues, Katherine Hempstead, senior adviser at the Robert Wood Johnson Foundation, said New Jersey should be looked at as a model for other Medicaid expansion states.
She credits early and more recent initiatives, including new laws Gov. Phil Murphy signed that will preserve components of the ACA like the individual mandate and a reinsurance program to reduce premiums, that have led to better health care access in the state.
“New Jersey has done everything it can do to make the market a success,” Hempstead said. “The state has been responsible for a regulated market, to provide people with comprehensive coverage. It has always tried to keep out junky policies.”
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It’s not perfect, experts note. Premium and deductible costs have risen over the years, making it difficult for some patients to afford health care under their insurance plans, providers reported. Sanders said affordability has remained a challenge.
Hempstead said overall, she sees this as a time when the market has stabilized to the effect that insurance carriers are more interested in participating in Obamacare as they better understand their patient populations and costs.
State officials said final ACA plan rates are expected to be finalized and released by the end of the summer ahead of open enrollment, which begins Nov. 1.