Iowa Drops Obamacare Waiver Request

by | October 24, 2017

By Rod Boshart

Thousands of Iowans face paying significantly more for their individual health insurance premiums -- or going without coverage -- after a state effort to win federal waivers of some Affordable Care Act provisions to prop up Iowa's collapsing marketplace ended Monday.

Iowa Insurance Commissioner Doug Ommen and Gov. Kim Reynolds called a Statehouse news conference to announce that Iowa was withdrawing its "stopgap" proposal -- first made in June -- to stabilize the individual market in part by attracting healthy Iowans needed to temper rate increases.

"We were doing something no state had tried to do," Ommen said. The health law popularly known as Obamacare "has caused our market here in Iowa to collapse, and unfortunately now its inflexibility is preventing us from picking ourselves up and making the adjustments that are needed in order to attract healthy people back in."

Ommen said Iowa offered an innovative approach, but Reynolds said Obamacare provisions proved too inflexible to overcome.

"I'm extremely disappointed," said Reynolds, who added that Trump administration officials gave Iowa a fair hearing.

"It came down to the law. As it's written, it just does not afford the flexibility that we need to be creative," she said. "The bottom line is we need Congress to do their job. They need to act and they need to act sooner rather than later."

In a statement, U.S. Sen, Chuck Grassley joined his fellow Republican in asking for Congress to try again.

"As written, the law hamstrings the administration's ability to help Iowa," Grassley said. "I hope Congress will act soon to repeal and replace this unworkable and unaffordable law."

However, the news also comes about two weeks after the Washington Post reported that President Donald Trump personally called the Centers for Medicare and Medicaid services in August to direct that Iowa's application be denied, as one of several actions he has taken to unravel the health insurance law.

Iowa's withdrawal comes only a week before this year's enrollment period opens Nov. 1 and despite the state insurance division's warning that without the plan, 22,000 Iowans will drop out of the market.

Ommen said the Trump administration informed the state last week it was still "several weeks" away from determining how much federal funding the state might receive, a key part of the proposal.

Monday's announcement means that Minnesota-based Medica will be the only statewide insurer in the Affordable Care Act marketplace in Iowa for 2018.

Medica said its premium rates would go up an average of 57 percent in 2018, partly because Trump also has ended cost-sharing subsidies to the insurance companies that held rates down.

State officials had complained that large of an increase would significantly hurt people who don't buy on the marketplace or don't qualify for federal tax credits.

"We certainly understand the state's desire to improve the individual market in Iowa, and we are appreciative of being a part of those discussions," said Larry Bussey, Medica's communications director. "While this is not the preferred outcome for the state of Iowa, we want consumers to know that Medica is ready."

Bussey said consumers who previously purchased coverage through healthcare.gov will receive information from the government and Medica over the next week explaining options.

"We strongly encourage consumers to see if they qualify for a premium subsidy" that could "dramatically reduce" costs for those found to be eligible, he said.

Reynolds said the lack of the waiver will hit farmers, self-employed Iowans, early retirees and others who rely on individual insurance coverage. She said the state continues to explore short-term options to help Iowans get some type of affordable health-insurance coverage, but most require waivers.

Newly installed state Senate Democratic Leader Janet Petersen of Des Moines said Democrats are ready to work with Reynolds to find a workable, bipartisan solution. But, so far, she said, Republicans "have done everything possible to undermine Obamacare."

But Republican Party of Iowa spokesman Carlos Cruz said the blame falls to the failure of Obamacare -- and he applauded Reynolds and Ommen for trying.

State Sen. David Johnson, an Ocheyedan independent, said the situation calls for presidential leadership but the current approach appears to be to allow Obamacare to fail in hopes the GOP-led Congress will replace it.

"I don't believe that's a winning strategy -- that failure leads to success," Johnson said.

(c)2017 The Gazette (Cedar Rapids, Iowa)