ACA repeal would create financial uncertainly for Wyoming

By Ramsey Scott

Wyoming Tribune Eagle

Via Wyoming News Exchange

CHEYENNE — As the fate of the Affordable Care Act works its way through the federal court system, Wyoming is left to wonder what type of impact a repeal would have on health care in the Equality State.

A legal challenge by 20 state attorneys general against the ACA is working its way through the Fifth U.S. Circuit Court of Appeals after a district judge in Texas overturned the law. The legal basis for the challenge centers around the repeal of the individual mandate, which was included in the 2017 tax reform passed by Congress.

Without that individual mandate, the states involved in the suit argue the remainder of the law is invalid. And those states got a major boost in their efforts when President Donald Trump said this week the Justice Department would stop defending the law in court and instead ask for it to be thrown out.

Wyoming was one of 14 states that hasn’t expanded its Medicaid population through the ACA, meaning any nullification of the law wouldn’t immediately kick thousands of people off government health care.

But the repeal of the ACA would still be felt in Wyoming, especially on the state’s health insurance exchange and by those with pre-existing medical conditions. If the ACA were declared invalid without a replacement plan in place, thousands of people in Wyoming with pre-existing conditions could lose their coverage or see premiums skyrocket.

Currently, about 25,000 people in Wyoming receive their health insurance through the state’s marketplace, with 95 percent receiving subsidies from the federal government to pay for premiums. According to the Wyoming Department of Insurance, the average monthly premium in 2017 was $983, with an average subsidy of $926.

Given that Wyoming’s premiums are higher than the national average, the state receives some of the highest federal insurance subsidies, said Tom Glause, Wyoming’s insurance commissioner.

Glause said he couldn’t speculate about what would happen to the insurance market if the ACA is overturned in the courts. Because the legal process could take years, he said he didn’t want to create fear in the state about changes to the market.

The state will continue to monitor the court cases as they work their way through the system, Glause said.

But if the ACA is eventually overturned, Glause said the state would need to figure out a way to help provide insurance for those currently receiving subsidies, or those who would find it hard to be insured due to a pre-existing medical condition.

“(The exchange) would no longer be an option. So we would look at other options for people,” Glause said. “I would assume the insurance companies that are writing plans in Wyoming would offer a plan. And we would also look to our Wyoming Health Insurance Pool as another avenue to offer people coverage who couldn’t otherwise find it.”

The Wyoming Health Insurance Pool was how the state helped provide insurance for those who couldn’t find a plan due to pre-existing conditions before the ACA. Glause said if the ACA were repealed, the state could use that system again to help provide insurance but would need to look at the rates it would charge customers.

“We would want to look at the rates we’re charging in the pool, since the pool was designed for high-risk individuals with pre-existing conditions,” Glause said. “The premiums were higher than they were on the open market.”

The Wyoming Department of Health was also monitoring the court case to see what, if any, impacts it would have on the state, said Kim Deti, spokeswoman for the Department of Health.

“Largely, it’s difficult to tell at this point. The Affordable Care Act was a very large and complex piece of legislation, and its implementation has been complex over the years,” Deti said. “The biggest part of the Affordable Care Act that has potential to affect us is the Medicaid piece. There were some eligibility changes for (the Children’s Health Insurance Program) and Medicaid.

“We don’t have any estimate of how many people would be affected at this point.”

The amount of money Wyoming could lose in assistance from the federal government would be in the hundreds of millions of dollars, according to a study from the nonprofit Urban Institute. That study showed if there were no plan to replace the ACA, Wyoming could lose about $243 million in insurance subsidies, Medicaid payments for non-elderly patients and Children’s Health Insurance Program funding.

The potential of 25,000 people being kicked out of the insurance marketplace could have significant ramifications on the cost of health care in Wyoming, as well. The state already has some of the highest medical costs in the country, and a large number of people losing their current health insurance could drive costs higher, said Eric Boley, president of the Wyoming Hospital Association.

As hospitals and medical practices treat more patients without coverage, those unpaid costs will eventually be spread out throughout the system to those patients who have insurance.

“If there’s not a replacement of some sort, we expect that we’d see that uncompensated care (at hospitals) grow and put our facilities at more risk than they already are,” Boley said.

Those costs to hospitals would be not only from people without insurance, but from those whose plans only offer the very basic of benefits, Boley said. High premiums and deductibles, along with bare-bones coverage, means many patients could be faced with high costs for treatment that could eventually go unpaid.

“From the insurance side of things, one reason why we’ve seen the uncompensated care grow is because of those programs with huge premiums and out-of-pocket costs,” Boley said. “In the long run, if you have (almost 25,000) people with insurance and seeking care, there’s a benefit to providers, whether its doctors or hospitals. At least they have that coverage.

“It could have a huge negative impact to health care delivery across the state” if the exchange goes away, he said.