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How Private Health Insurance is Changing in 2019?

By March 1, 2019 No Comments

Health care reform has been a dominant topic in U.S. politics since the 2017 presidential election. Several bills have been introduced to reform the Obama administration’s Affordable Care Act (ACA), which is often referred to as “Obamacare”. The most notable attempt came in the form of the American Health Care Act (AHCA), which was passed by the House of Representatives only to fail in the Senate. Despite the flurry of political debate, news coverage, and legislative activity, the ACA remains in effect today, albeit with some important changes coming in 2019.

The single biggest change made to the ACA is the reduction of the individual mandate penalty to $0 starting in January 2019. As part of the tax reform bill signed into law in December 20171, the change is important for a few reasons. First, the penalty’s removal eliminates the metaphorical stick used to goad the young and healthy into buying health insurance. This will likely lead many young people to decide not to purchase insurance, making the overall pool of the insured older and less healthy, causing premiums to increase. The Trump administration’s decision to stop reimbursing insurers for cost sharing will likely exacerbate the impact on premiums, with some experts projecting that premiums will increase an average of 2.8% (nearly $580 per year) in 2019.2 Perhaps even more significantly, states are challenging the ACA in federal court in the case of Texas vs. Azar on the basis that the $0 individual mandate penalty no longer qualifies as a tax, making the law unconstitutional.3 The lawsuit is likely headed for the Supreme Court where, if the plaintiffs are successful, all of Obamacare could be tossed out.

2019Other scheduled changes for 2019 include revisions to the types of private insurance plans available and the ways in which they can be purchased. Short term plans can now be purchased for up to one year of coverage and are renewable for up to three years. This represents a significant change from the maximum three months of coverage allowed previously. Policies have also been revised to expand the availability of “association plans,” which are health insurance plans offered by trade, industry, and professional groups. Association plans are usually cheaper than plans offered by employers, but in most cases lack the full suite of benefits required of ACA-compliant plans.4 Yet another change to come in 2019 is a rule that allows online brokerage sites to directly enroll customers into health insurance plans. Instead of redirecting customers to government-run exchanges for verification of eligibility criteria and enrollment, customers can now complete the entire process on third-party websites.4

One of the most notable developments for health insurance in 2019 is the emergence of greater variability in insurance plans between states. The Trump administration’s efforts to weaken ACA restrictions have led to a divergence between blue and red states as the former pass laws to reinforce Obamacare policies, while the latter embrace the federal pullback. The dramatic divergence between states can be seen in the comparison between Minnesota and Maryland where Minnesota silver plans are expected to be 11% cheaper in 2019 compared to 2018, while silver plans in Maryland are expected to be 36% more expensive.5

These changes to private health insurance aren’t expected to have an inordinate impact on anesthesia care, but like other health care providers, anesthesia service professionals will have to cope with the increased uncertainty of the current regulatory environment. The elimination of the individual mandate penalty and rising premiums could reduce the percentage of insured patients, which may weaken demand for certain anesthesia services. Greater state-to-state variability may also complicate operations for anesthesia practices serving populations coming from more than one state. Anesthesia service professionals should remain vigilant in 2019 as federal and state health care policies continue to change and evolve.

References: 

  1. Armour, Stephanie and Kristina Peterson. “Senate GOP Tax Plan to Include Repeal of Health Law Individual Mandate,” The Wall Street Journal (November 14, 2017). https://www.wsj.com/articles/senate-gop-tax-plan-to-include-repeal-of-health-law-individual-mandate-1510690807.
  2. Gaba, Charles. “The Chart That Shows the Price Tag for Trump’s Obamacare Sabotage,” The New York Times (December 27, 2018). https://www.nytimes.com/2018/12/27/opinion/trump-obamacare-sabotage-chart-cost.html.
  3. Keith, Katie. “Court Rules Individual Mandate, Entire ACA Unconstitutional,” Health Affairs 38, no. 2 (2019): 1-2. doi: 10.1377/hlthaff.2019.00024.
  4. “7 Big Health Insurance (Obamacare/Trumpcare) Changes for 2019.” eHealth. Last modified October 2, 2018. https://www.ehealthinsurance.com/resources/individual-and-family/11282.
  5. “Cost of Individual Health Insurance Depends More Than Ever on Where You Live.” Consumer Reports. Last modified August 30, 2018. https://www.consumerreports.org/health-insurance/cost-of-individual-health-insurance-depends-more-than-ever-on-where-you-live.

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