Opinions

Lawmakers' fixation on repeal of 'Obamacare' does nothing to improve Alaska health care

The Alaska congressional delegation and the Republican Party suffer from "Obamacare" repeal syndrome, a chronic condition since 2010.

The symptoms are a compulsion to selectively use statistics and exaggerate the downside, ignoring all positive aspects of the law, including evidence the health care law has helped people get health insurance coverage -- thousands in Alaska and millions across the U.S.

The first step toward a cure is admitting that "Obamacare" is like every other law in history, an imperfect instrument our political leaders ought to be working to improve.

That's more sensible than the repeal fixation, premised as it is on empty promises about replacement plans that warrant more disclaimers than any wonder drug ad on TV. Trust Donald Trump's claim that he will replace the Affordable Care Act with "something terrific" as soon as Mexico pays for the wall.

Alaska politicians, both state and federal, can start by addressing the most obvious "Obamacare" problem in our state—the cost of insurance on the individual marketplace is going up about 40 percent in 2016 in Alaska, following a rate increase of more than 30 percent in 2015.

Nearly 90 percent of the people who buy insurance coverage on the federal exchange in Alaska are eligible for federal subsidies, but the skyrocketing rates are unsustainable. There's no big mystery about why this is happening, according to Premera Blue Cross and Moda, the two companies offering policies.

Dozens of Alaskans with chronic and life-threatening illnesses have signed up for coverage—now that they can't be refused because of pre-existing conditions and they have enormous medical bills. The Alaskans in this group are not old enough to qualify for Medicare and they have yet to go bankrupt because of medical bills.

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For Premera, 37 of its customers in Alaska who bought insurance through the individual market generated $11.2 million in medical bills during the first six months of this year, about $300,000 per person.

"The lack of a large enough pool to spread the cost of care for those individuals is the overwhelming key driver of this rate increase," Premera said.

The 8,500 other policyholders who bought so-called bronze, silver or gold plans had about $34 million in claims among them, about $4,000 per person.

Without a large enough customer base over which to spread the high costs of caring for those with congestive heart failure, various types of cancer and other serious illnesses, the situation will not improve, the companies said.

"Without a change to the way this pool is funded, the treatment of these chronic conditions will continue to significantly impact the rates all Premera's individual members pay," the company told the state in May, seeking a 38.7 percent rate increase.

"Premera and other carriers that serve Alaska are advocating the state of Alaska implement a supplemental state reinsurance program hopefully in time for the 2017 plan year. This is a mechanism to achieve market stability and mitigate the need for large rate increases in the individual market by spreading high medical costs across the entire insured market," the company said.

The companies said they have drafted a bill to provide supplemental insurance that would spread the costs among all insured people in Alaska. The final language has yet to be publicly released, but it is expected to provide a mechanism so that the cost of covering high-risk individuals for certain types of claims would be spread across the entire small and large-group insurance markets in the state.

The plan would use the Alaska Comprehensive Health Insurance Association as a mechanism to spread the risk and lower the burden on the individual market.

In years past, when companies could deny coverage to people who had pre-existing conditions, the supplemental coverage offered by the association, which was far more expensive than regular insurance, was the only option for many people who were deemed uninsurable. It was financed by assessments on private health insurers doing business in Alaska.

Melanie Coon, the senior communications manager for Premera, said there would be no change in the way people shop for insurance. "The state can do this as it is a supplemental program and it would work under federal law," she said. There are no numbers yet on just what this would mean to other insurance rates, but spreading the burden over tens of thousands of people is bound to help.

This legislation, when it emerges, will deserve close scrutiny by the governor and Legislature to make sure this is the best approach to help more Alaskans afford health care coverage. That's more pragmatic than waiting for a replacement plan that may never materialize.

The views expressed here are the writer's own and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary(at)alaskadispatch.com.

Dermot Cole

Former ADN columnist Dermot Cole is a longtime reporter, editor and author.

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