WASHINGTON — Today, U.S. Sens. Mark R. Warner and Tim Kaine (both D-VA) sent a letter to U.S. Secretary of Health and Human Services (HHS) Alex Azar, urging him to take swift action to stabilize the insurance marketplace. On May 4, the majority of health insurers filed initial rates with the Virginia Bureau of Insurance proposing to raise premiums between 15 and 64 percent in 2019 – a move that could impact more than 400,000 Virginians who purchase their health care coverage through the individual marketplace. 

“We are concerned that these substantial rate increases will negatively impact hundreds of thousands of individuals in Virginia that purchase their plans on the health insurance marketplace,” wrote the Senators. “Additionally, we are disappointed to know that these increased costs are largely a result of policies the U.S. Department of Health and Human Services (HHS) and Republicans in Congress have pursued and implemented.”

In 2017, the Trump Administration ended cost sharing reduction payments under the Affordable Care Act, a move that subsequently destabilized the individual marketplace and increased premiums for people who do not receive financial assistance on the marketplace.  Since then, Congressional Republicans and the Administration have taken several steps to undermine the success of the Affordable Care Act, including repealing the individualmandate and expanding the availability of short-term health plans that don’t cover many basic health care costs such as prescription drugs, maternity care, or preventive health services. According to experts, expanding the availability of these plans – which don’t protect consumers from discrimination on the basis of age, gender, or pre-existing conditions – will draw younger and healthier consumers out of the health care marketplaces and further raise premiums for individuals who depend on the individual market to purchase their health care coverage.   

In filing their proposed rates for 2019 with the Virginia Bureau of Insurance, insurers directly cited the elimination of cost-sharing reductions, the expansion of short-term plans, and the elimination of the individual mandate to justify double-digit rate increases.  

“Double digit premium increases are not only unacceptable, they are also avoidable. We are committed to work with you to take proactive steps to lower premiums in Virginia and across the country. This would include prioritizing proposals that would establish a federal reinsurance program and continuing cost sharing reduction payments while adopting policies to hold harmless those people who do get financial help in the marketplace,” the Senators told Sec. Azar. “We also would encourage you to revise your recently proposed rule to expand the use of short term limited duration plans. Finally, we urge you to reverse recent policies to shorten the annual open enrollment period, slash funding for consumer outreach and assistance, and other efforts to undermine consumer protections. Without these important changes it is likely Virginians and other Americans will continue to experience significant premium increases in the future.”

In addition, according to a study by Medicare's chief actuary that was released on Tuesday, President Trump’s plan to expand short-term health insurance policies will drive up federal spending by $1.2 billion next year and by a total of $38.7 billion over 10 years – significantly more than the Trump Administration’s original estimates.

Sens. Warner and Kaine previously raised similar concerns in a public statement after Virginia insurers filed their initial rates for 2019.

The full text of today’s letter can be found below and here.

Honorable Alexander M. Azar II

Secretary

U.S. Department of Health & Human Services

200 Independence Avenue, S.W.

Washington, D.C. 20201 

Dear Secretary Azar,

We write to you regarding the 2019 proposed premium rates in Virginia. The majority of insurers filed proposed rates with the Virginia Bureau of Insurance earlier this month that propose to increase premium rates for plans on the health insurance marketplace between 15 and 64 percent in 2019. We are concerned that these substantial rate increases will negatively impact hundreds of thousands of individuals in Virginia that purchase their plans on the health insurance marketplace. Additionally, we are disappointed to know that these increased costs are largely a result of policies the U.S. Department of Health and Human Services (HHS) and Republicans in Congress have pursued and implemented.

Virginia insurers have directly cited actions by HHS to eliminate cost sharing reduction payments, which increased premiums for those who don’t get financial help in the marketplace, and a recently proposed rule to expand the use of short term limited duration (STLD) plans when explaining the justification for their substantial rate increases. In addition, insurers have stated that premiums were further increased when Republicans in Congress and President Trump passed legislation repealing the individual shared responsibility provision. Together, these changes have made it more difficult – and in some cases impossible – for many Virginians to afford their health care premiums.

Doctors, hospitals, patient organizations and the medical community have raised concerns that the actions listed above will result in patients paying more money for less care. They have the potential to disproportionally hurt older Americans and individuals with pre-existing conditions by making it more difficult for them and other Virginians to get affordable plans that cover basic benefits such as hospitalization, behavioral health, prescription drugs, and maternity care. The Urban Institute estimated that the impact on premiums due to expanded STLD policies and the loss of the individual shared responsibility provision is 19 percent, while, the non-partisan Congressional Budget Office projects that repeal of the ACA’s individual shared responsibility provision alone will increase individual market premiums by 10 percent in 2019.

Double digit premium increases are not only unacceptable, they are also avoidable. We are committed to work with you to take proactive steps to lower premiums in Virginia and across the country. This would include prioritizing proposals that would establish a federal reinsurance program and continuing cost sharing reduction payments while adopting policies to hold harmless those people who do get financial help in the marketplace. We also would encourage you to revise your recently proposed rule to expand the use of short term limited duration plans. Finally, we urge you to reverse recent policies to shorten the annual open enrollment period, slash funding for consumer outreach and assistance, and other efforts to undermine consumer protections. Without these important changes it is likely Virginians and other Americans will continue to experience significant premium increases in the future.

We are willing to work with you on the steps listed above and other proposals that will stabilize the health insurance marketplace and reduce premiums for enrollees. We simply ask that you work with us, rather than against us, to achieve the important and shared goal of ensuring affordable and accessible health care coverage for Virginians. Thank you for your consideration of our letter and we look forward to your response.

Sincerely,

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