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In Test of Obamacare Support, Trump Administration Rejects Idaho's Plan to Ignore the Law

The Trump administration sent a letter to Idaho Gov. Butch Otter on Thursday turning thumbs-down on his proposal to allow the sale of health insurance plans in Idaho that don't comply with the Affordable Care Act.

By Betsy Z. Russell

The Trump administration sent a letter to Idaho Gov. Butch Otter on Thursday turning thumbs-down on his proposal to allow the sale of health insurance plans in Idaho that don't comply with the Affordable Care Act.

While expressing sympathy for efforts like Otter's to make health insurance more affordable, the letter said that the ACA, also known as Obamacare, "remains the law and we have a duty to enforce and uphold the law." The letter was addressed to Otter and state Insurance Director Dean Cameron, from U.S. Health and Human Services Administrator Seema Verma.

Otter and Lt. Gov. Brad Little signed an executive order in January allowing the sale of the plans; Blue Cross of Idaho has submitted a proposal to the Idaho Department of Insurance to start selling the new "state-based plans" this month.

The plans were expected to offer sharply lower premiums, through such tactics as charging people more based on their health history, or by not covering some health needs like maternity care.

Verma gave Idaho 30 days to respond, and threatened that if Idaho doesn't comply with the law, the federal government could take over enforcement in the state and impose hefty fines on insurers offering the plans.

She also, however, noted a Feb. 21 ruling from the Departments of HHS, Labor and the Treasury allowing short-term health insurance plans, which don't fully comply with ACA requirements, to expand from the current three-month limit to any period that's less than 12 months.

"We believe that, with certain modifications, these state-based plans could be legally offered under the PHS Act exception for short-term, limited-duration plans," Verma wrote. "I encourage you to continue to engage in a dialogue with my staff regarding this and other potential options."

Jon Hanian, Otter's press secretary, said late Thursday afternoon that the governor had just received the letter and was reviewing it, and had no immediate comment.

Verma said her agency was sympathetic to Idaho officials' concerns, and said President Donald Trump is "committed to doing everything in his power to increase competition, choice, and access to lower-priced, high-quality health care options for all Americans."

"As you know, the Patient Protection and Affordable Care Act (PPACA) is failing to deliver quality health care options to the American people and has damaged health insurance markets across the nation, including Idaho's," Verma wrote, noting that premium rates for coverage through the Idaho health insurance exchange have increased by more than 91 percent from 2014 to 2018, while insurance companies continue to incur losses.

The letter listed eight areas in which the U.S. Department of Health and Human Services believes Idaho's proposed plans would fall short of federal requirements, including rules against charging customers significantly more based on their age, location or history, rules  outlawing discrimination against people with pre-existing medical conditions and rules prohibiting lifetime and annual coverage caps.

Other areas where Verma said the state-based plans fell short included failing to cover all "essential health benefits" required under the ACA and failing to include preventive services such as immunizations or some health screening tests.

The Associated Press contributed to this report.

(c)2018 The Spokesman-Review (Spokane, Wash.)

Caroline Cournoyer is GOVERNING's senior web editor.
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