Highlight on Arizona: Premiums skyrocketing for Arizonans, Republican governor committed to keeping health protections in place

When it comes to premium increases for marketplace plans, Arizona is one of the hardest-hit states. For the 2017 plan year, reports show that premiums across the country will increase by an average of 22 percent. In Arizona, that number is 116 percent.

According to HHS, Arizona had the lowest rates of the states in 2016. This honor came back to bite marketplace consumers, who will be forced to pay around $422 per month for even the lowest cost plans in 2017. That will come as a blow to the wallet, considering the average of $196 for 2016.

Dr. Robert Tenchsel, CEO of the Yuma Regional Medical Center, admitted that this may cause some consumers to choose to opt out of coverage, because paying the penalty will be cheaper than their premium. Selections for coverage are limited, and consumers must either choose between marketplace plans or Blue Cross Blue Shield of Arizona.

Since the election, Arizona Governor Doug Ducey (R) has drawn attention to the necessity of enacting  new health insurance protections if the new administration follows through with President-elect Trump’s campaign promises to repeal the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148). Ducey agreed that the ACA “isn’t working…that it’s badly broken and in need of improvement,” but remains committed to keeping access to affordable care available for his state’s citizens.

Ducey pointed to certain parts of the law that need to be preserved, such as protections for those with pre-existing conditions, prohibitions against lifetime caps, and federal funding for expanded Medicaid programs. Arizona chose to expand Medicaid and accept federal assistance in covering the 400,000 newly eligible. Arizona also restored coverage for single adults living below the federal poverty level, which had been cut years before due to the necessity of finding budget savings. The state received some federal money for this measure, and the rest is funded by assessments on hospitals (which is still in dispute in the state court system).

If the ACA is repealed and the federal funding for Medicaid expansion is revoked, the state will either have to take away health coverage for this part of the population, or find more money in the already stretched state budget. Although during his campaign Ducey stated that the ACA’s Medicaid provisions were an “unacceptable expansion of government,” he said he would veto any attempt by the state legislature to repeal the expanded program now that so many citizens depend on it for coverage.

 

Arizona KidsCare restart estimated to help 40K children

Arizona will begin taking applications on July 26, 2016, for its government-sponsored health-insurance program KidsCare; coverage will begin September 1, 2016. As a result, the population of uninsured Arizona children, currently around 162,000, is projected to drop significantly this fall, as an estimated 34,278 Arizona children would be eligible for KidsCare upon reinstatement of the program.

KidsCare, the Arizona version of the Children’s Health Insurance Program (CHIP), is administered by the state’s Medicaid program, which is known as the Arizona Health Care Cost Containment System (AHCCCS). Officials with AHCCCS expect that within its first year of being newly active, KidsCare will enroll 30,000 to 40,000 Arizona children. Arizona is the only state without an active CHIP program. According to a study by the Center for Children and Families at Georgetown University, the state has the third-highest rate of uninsured children in the U.S.

Opponents of KidsCare have expressed concern that Arizona will eventually have to pick up the tab for the program, as federal dollars are only appropriated to cover the cost of the program for the next year. Supporters said reopening the program was the moral thing to do for Arizona children.

KidsCare

Enrollment in KidsCare was frozen in 2010 after Arizona decided to cut eligibility and phase out CHIP benefits over time. KidsCare II, a temporary hospital financing agreement meant to fill the gap due to frozen enrollments beginning in 2010 until new coverage options were available to Arizona families with the implementation of the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148), was terminated at the end of January 2014.

An earlier Georgetown study observed that the termination of KidsCare resulted in families paying more for alternative subsidized health care coverage while receiving fewer benefits under that coverage (see Arizona CHIP discontinuation results in higher prices, less coverage, Health Law Daily, May 9, 2014).

Ninth Circuit Halts Arizona’s Implementation of 20 Week Abortion Ban

The Ninth Circuit Court of Appeals issued an emergency preliminary injunction last week preventing a new Arizona abortion ban from being implemented until the court has heard the case this fall and issues a ruling.  The injunction came two days after a U.S. District Court judge upheld the state’s law, one of many abortion restrictions passed during the most recent legislative session. This law would make Arizona one of nine states to generally prohibit abortions more than 20 weeks after a woman’s last menstrual period.

The 20 week bans are part of a new legislative movement based on the concept that fetuses can experience pain after 20 weeks of gestation. Supporters of the ban assert that, in addition to causing pain to the fetus, abortion procedures performed this late in a woman’s pregnancy put the woman at increased medical risk. The District Court judge found that the ban would not substantially obstruct the majority of abortions and that fetal pain was a “legitimate interest” of the state’s restriction.

Those in opposition of the ban counter that a woman’s medical risk was actually increased by not allowing her to have an abortion after 20 weeks.  They argue that the fetal pain concept is not grounded in acceptable scientific fact. They also contend that the exceptions for medical emergencies are so narrowly drawn that women may suffer severe medical issues by being forced to carry dangerous pregnancies to term. The legislation exempts late abortions from the ban for purposes of avoiding death of the mother or a “substantial and irreversible impairment of a major bodily function.”

The ban, if upheld by the Ninth Circuit, will make the performance of abortions after 20 weeks a misdemeanor and will put the doctor at risk of license revocation. The law additionally imposes other abortion restrictions, including requirements for the creation of a state website illustrating fetal development, parental consent for minors, and limitations on the conditions for prescribing nonsurgical abortions. So far, 2012 has been an active year for anti-abortion legislation, with 40 abortion constraints having been enacted into law by 13 states.

HHS Deems Insurance Premium Hikes in 9 States Excessive

HHS Secretary Kathleen Sebelius has announced that health insurance premium increases in nine states are “unreasonable” under the rate review authority granted by the Patient Protection and Affordable Care Act (PPACA) (P.L. 111-148), which requires insurance companies to justify rate increases of 10 percent or higher.

The announcement was made after HHS determined, based on independent expert review, that two insurance companies have proposed unreasonable health insurance premium increases in Arizona, Idaho, Louisiana, Missouri, Montana, Nebraska, Virginia, Wisconsin, and Wyoming. The rate hikes would affect over 42,000 residents across these nine states. Sebelius has called upon these companies to immediately rescind their unreasonable rate hikes, issue refunds to consumers or publicly explain their refusal to do so.

New rate review report issued by HHS

Sebelius also released a new rate review report showing that, six months after HHS began reviewing proposed health insurance rate increases, health insurers have proposed fewer double-digit rate increases and states have begun to take an active role in reducing rate increases. In fact, since March 10, 2012, the justifications and analysis of 186 double-digit rate increases for plans covering 1.3 million people have been posted at HealthCare.gov, resulting in a decline in rate increases. In the last quarter of 2011 alone, according to the report, states have reported that premium increases dropped by 4.5 percent, and in states like Nevada, premiums actually declined.

In these nine states, the insurers have requested rate increases as high as 24 percent. HHS has deemed these increases unreasonable because the insurer would be spending a low percentage of premium dollars on actual medical care and quality improvements and because the justifications of the insurers for the premium increases were based on unreasonable assumptions.

It should be noted that most rates are reviewed by states and many states have the authority to reject unreasonable premium increases. In addition, since the passage of PPACA, the number of states with this authority has increased from 30 to 37, with several states extending existing “prior authority to new markets. The HHS report also shows that:

• Texas, Kentucky, Nevada and Indiana are reporting fewer requests for rate increases over 10 percent;

• California, New York, Oregon, and many others, have proactively lowered rate increases for their residents; and

• the rate review program has made insurance companies explain their increases, and more than 180 have been posted publicly and are open for consumer comment.