Commentary: Review And Revision Are Key To Health Care Reform

By Cathy Mahaffey

The pledge by Republicans to repeal the Affordable Care Act (ACA) has reignited debate over needed reforms.

As CEO of Common Ground Healthcare Cooperative, one of only five Consumer Operated and Oriented Plans (CO-OPs) still standing nationwide since their formation under the ACA, I have a unique perspective regarding potential solutions and improvements to the ACA. Our CO-OP’s membership is primarily comprised of individuals purchasing on the Exchange, and unlike a private insurance carrier, our non-profit health insurance cooperative focuses solely on member needs, without the influence of external shareholders.

It is disheartening that the security of our members’ health insurance coverage is caught up in this political battle. Every decision we make puts our members at the forefront and I implore Congress to apply that same philosophy to this debate – do what’s best for Americans rather than for your political party. If that was the case, rather than a repeal and replacement of the ACA, Congress would conduct a careful evaluation of what has worked and what has not and then implement effective reforms. This would provide ACA enrollees the security of knowing their coverage will not be taken away and would also assure the American people that our leaders are doing all that they can to address the costs of health care and health insurance.

Our members are very interested in lower health insurance premiums and lower out-of-pocket costs, and we support an overhaul aimed at fixing problems with the ACA. But what’s missing from the political debate is a real examination of why health insurance premiums and consumer out-of-pocket costs are rising at a rate our economy can’t support.

There seems to be consensus on continuing to provide access to health insurance even with pre-existing conditions, yet there is also interest in reviving high risk pools. How does one enroll in a high risk pool without a review of a consumer’s pre-existing conditions? This is but one example of how complicated this is and the need for a deep understanding of the health insurance and health care systems.

As Congress moves forward on ACA reform, I offer these considerations:

• Individual Mandate: There must be some mechanism in place so consumers don’t buy insurance only if they need it. I believe the penalty for not obtaining insurance should be higher than the annual cost to purchase a health insurance plan – otherwise it’s an easy decision for consumers to not purchase health insurance. Without the ability to insure everyone, insurance carriers can’t be expected to cover pre-existing conditions if the consumer didn’t have continuous coverage. Without an immediate, effective replacement for the mandate, insurers will have no choice but to exit the marketplace.

• Funding: Programs to stabilize premiums, often called the 3 Rs for Risk Adjustment, Reinsurance, and Risk Corridors, were put in place for very good reason. These programs were designed to keep consumer premiums reasonable after high risk pools were eliminated and through the bumpy transition to the ACA. I am offended by suggestions that the 3 Rs are an “insurance company bail-out” or “insurance company welfare.”  Our CO-OP’s revenue consists mainly of premiums, ACA-related financial assistance for lower income members and payments through these programs (far short of what was promised).  Nearly all of it has been passed along to providers and pharmaceutical companies. The high cost of health care must be addressed and consumers must take responsibility for their health if we want to make health insurance affordable. Helping consumers afford their monthly insurance premiums is a critical and important aspect of reform, but premiums will continue to escalate if we don’t address the underlying costs. In the interim, I recommend extending the transitional reinsurance program, which makes payments to insurers for their particularly costly members, because it is the only one of the 3 Rs to actually work as intended.

• Close the loopholes: There are too many ways consumers can take advantage of loopholes, leading to higher overall costs for everyone. Special enrollment periods allow consumers to obtain coverage only when they get sick, the 90-day grace period on premiums enables consumers to get coverage without paying for it and some providers encourage high-cost patients to keep private insurance – allowing them to make more money – instead of steering patients to government programs. These and other loopholes all contribute to higher premiums for consumers who play by the rules.

Today, healthcare is nearly one-fifth of the US economy. Our country deserves an honest, apolitical review of what has worked and what has not under the ACA and then a smart transition to improvements toward a healthier system. A repeal and delayed replacement is not in anyone’s best interest.

Cathy Mahaffey is Chief Executive Officer of Common Ground Healthcare Cooperative in Brookfield, Wis.