Governors to Congress: ‘Make a clear commitment’ to value-based care

A group of eight governors—five Democrats, two Republicans and one independent—have proposed a series of reforms they hope congressional leaders use in crafting legislation to stabilize the Affordable Care Act (ACA) markets.

Congress is reportedly working on a short-term stabilization bill of its own after Republican-only attempts to replace the law failed in July. With President Donald Trump refusing to guarantee cost-sharing reduction subsidies will continue to be paid to insurers, leading to those carriers either dropping out of the market or requesting higher premiums, the governors’ first priority would be a congressional appropriation to ensure those payments are made.

“Congress should continue its work to identify reforms that strengthen insurance markets in the long term, but we need immediate action to ensure consumers have affordable options in the short term,” they wrote. “Insurers have until the end of September to make final decisions about participating in the marketplaces. Congress and the Administration need to send a strong signal now that the individual market will remain viable this year, next year, and into the future.”

They suggested several other immediate actions, including setting up a two-year, $15 billion stability fund that could be used for state reinsurance programs and exempting insurers from the health insurance tax in areas where only one carrier is participating on the ACA exchange.

One more urgent proposals seeks to save an unpopular part of the law: the individual mandate.

“The current mandate is unpopular, but for the time being it is perhaps the most important incentive for healthy people to enroll in coverage. Until Congress comes up with a better solution—or states request waivers to implement a workable alternative—the individual mandate is necessary to keep markets stable in the short term,” the governors wrote.

Beyond those short-term measures, the governors offered a list of potential changes which they said will “preserve and expand gains in coverage,” something the Republican repeal-and-replace plans would not have accomplished. Their suggestions included some more vague principles (like getting more young, healthy customers on the exchanges to improve risk pool) to more specific changes, like allowing states to develop “alternatives” to the law’s ten essential health benefits under the ACA’s Section 1332 waivers.

Unlike the recent healthcare bills introduced by Congress, the governors didn’t shy away from larger issues with healthcare costs. They ended their blueprint by saying the healthcare discussion will have to move beyond insurance coverage and “confront the underlying market dynamics” which are driving the growth in costs and embrace new payment models.

“Congress and the Administration should make a clear commitment to value-based health care purchasing. For example, Medicare and other federal programs should be allowed to participate in multi-payer State Innovation Models,” they wrote.

The blueprint explicitly mentioned expanding projects funded through the Centers for Medicare and Medicaid Innovation (CMMI). HHS Secretary Tom Price, MD, and CMS Administrator Seema Verma, MPH, have so far been moving CMMI models in the opposite direction, reducing participation and making proposed mandatory models voluntary.

Part of this approach, the governors said, should be greater transparency from providers about price and quality data to consumers. Available pricing tools, however, have been shown to be rarely used by patients, and current quality transparency efforts, like CMS’ hospital star ratings, have been sharply criticized by the providers themselves.

Concerns about the underlying drivers of costs aside, the governors concluded by emphasizing ACA market stabilization is the immediate concern. They appeared to warn against repeating the process which crafted the failed repeal bills, where committees were bypassed and only the majority party had a hand in writing the legislation.

“Lasting solutions will need support from both sides of the aisle, and we applaud the bipartisan efforts that have now commenced in both the House and Senate. We ask that you support these efforts to return to regular order, allowing committees to work in an open, transparent and bipartisan manner,” they wrote.

The plan was signed by Govs. John Kasich, R-Ohio; John Hickenlooper, D-Colorado; Brian Sandoval, R-Nevada; Tom Wolf, D-Pennsylvania; Bill Walker, I-Alaska; Terry McAuliffe, D-Virginia; John Bel Edwards, D-Louisiana, and Steve Bullock, D-Montana.