Washington Insurance Commissioner Mike Kreidler grabbed national attention last year when he broke with President Obama’s efforts to mollify a public upset by canceled insurance plans. Of late, Kreidler has been openly critical of the state’s botched efforts to make repairs to the online insurance exchange.
But Kreidler remains a champion of the effort to make universal health care a reality, and Washington has taken some meaningful steps in that direction. The state has reduced the number of uninsured residents by roughly 38 percent since it expanded who is eligible for Medicaid and opened a new insurance marketplace in October 2013.
Shortly before the kick off of the second health-insurance open enrollment period on Saturday, we spoke with Kreidler about health-care reform. Here’s what he had to say.
The case for greater transparency
Kreidler is undeniably a supporter of the health-care overhaul, but that hasn’t stopped him from publicly raising concerns about technology problems plaguing the state’s online insurance exchange.
“I’ll do a disservice if I portray it as perfect,” Kreidler said.
While Kreidler oversees insurance issues for the state, a separate organization called the Washington Health Benefit Exchange runs the Healthplanfinder marketplace.
Since the launch of the exchange more than a year ago, the site has struggled to resolve various technical troubles, the knottiest being the transfer of premium payment information. Consumers are paying their premiums, but the information and funds aren’t always being accurately transferred to the insurance companies, so it appears the people are uninsured, creating a nightmare for affected patients, doctors and insurers.
“This is something that should have been resolved early,” Kreidler said. But the problem still wasn’t fixed by the time the exchanges opened for enrollment on Nov. 15.
A key to solving the problem, Kreidler said, is for the exchange to have a more robust system for tracking consumer complaints to help them identify systemic problems more quickly.
Before enrollment opened, the exchange said roughly 1,300 accounts had payment problems, but insurance companies have claimed it’s more than 10 times that number. And from June to October, consumers lodged more than 500 complaints with the Office of the Insurance Commissioner regarding problems with their premiums, though the OIC is helpless to fix them.
“I feel very strongly that you have to be open and transparent and you can’t sweep things like this under the rug,” Kreidler said, “or your credibility will be diminished.”
The health of the exchange
Putting some of the technical challenges aside, “I’m pleased with the success the exchange has had,” Kreidler said. “We’re still doing much better than anyplace else in the country. We’re doing remarkably well.”
The updated Healthplanfinder website should provide a better shopping experience for customers, he said, making it easier to compare plans and figure out which ones cover specific medicines and doctors. Customers can more readily see what their out-of-pocket expenses will be.
But it’s essential that the website fix the remaining technical problems and reach sales goals to stay afloat. The exchange is required to be self-sustaining beginning in January, and its funding depends on selling enough plans through Healthplanfinder.
Health insurance plans are taxed, and for plans sold through the exchange, that money is given back to Healthplanfinder. Additionally, the exchange is charging insurance companies a $4 fee or “assessment” for each plan sold.
In addition to individual insurance plans, the exchange has for the first time a statewide marketplace for businesses employing 50 or fewer people, called Healthplanfinder Business. But only two insurance companies are offering plans through the exchange, and in most counties only Moda Health is selling coverage.
By the start of open enrollment, roughly 140,000 people had coverage through the exchange, and the agency hopes to sign up 85,000 more in the individual market by Feb. 15 when the enrollment period ends.
“I’m still optimistic” the exchange will continue growing and meet its goals, Kreidler said.
A bigger stick in 2015
The Affordable Care Act requires nearly all Americans to have insurance — and wields a penalty for those who do not. In 2014, the penalty was fairly modest: whichever was larger — 1 percent of a household’s adjusted income or a flat $95 per adult and $47.50 per child, up to a certain level.
This year the stick is bigger. Uninsured Americans in 2015 will be penalized 2 percent of their adjusted income or $325 per adult and $162.50 per child (there are some exceptions to who can be penalized). A single person earning $40,000, for example, would get hit with the 2 percent and owe nearly $600.
Kreidler expects the threat to start having a more meaningful effect.
“There is a psychological part of this,” Kreidler said. While insurance will still cost more than the penalty, at least people would be getting the benefits of coverage.
People will think, “I’d rather get something for my money rather than just throwing my money away,” he said. “More and more people will begin to recognize the benefits.”
Looming threats to the ACA
The Republican’s success in the midterm elections and the announcement that the U.S. Supreme Court will consider a case challenging a key ACA provision are raising new questions about the future of the health-care overhaul.
Kreidler is less concerned about what the Republican lawmakers can do to unravel the act, but the Supreme Court troubles him.
The court earlier this month agreed to hear a case asserting that the ACA allows only state-run exchanges to provide tax subsidies that lower the cost of health insurance based on one’s income. Only 13 states plus Washington, D.C., have state-run exchanges, according to the Kaiser Family Foundation. The remaining 37 are federally supported or facilitated, or a state-federal partnership.
While Washington’s Healthplanfinder is one of the state-run exchanges, that doesn’t mean it would be insurance-business-as-usual should the court find the subsidies in federal exchanges illegal, Kreidler warned.
“On paper it doesn’t impact us, but in practice it does,” he said. “It would have potentially very profound implications.”
Without the subsidies to lower the monthly premiums and out-of-pocket health care costs for millions of Americans, it would be nearly impossible to enforce the requirement that nearly everyone needs to have insurance coverage. And if the insurance mandate dissolved, the whole market would be disrupted.
It’s unclear when the system might become so entrenched — like Medicare or Social Security — that the public wouldn’t stand for its dismantling from the court or Congress.
“There have been some significant benefits with a reduction in the number of people who are uninsured, a decline in the amount of charity care in this country,” Kreidler said. “To all of a sudden to throw a curve ball in this late stage, would be difficult for the court to do.
“You’d be going back to a system that had significant problems.”