The head of the largest state-based Affordable Care Act (ACA) public health insurance exchange says a move by the Trump administration to cut insurance companies’ HealthCare.gov user fees will hurt efforts to get people covered.
Peter Lee, CEO of Covered California, said managers of HealthCare.gov should focus on using the user fee revenue to spread consumer awareness of the ACA exchange system.
“Proclaiming that a reduction of user fees leads to a reduction of premiums flies in the face of the reality that well-spent marketing dollars by this administration would have had a five-to-one return on lowering health care costs for Americans,” Lee said in a statement.
Lee put out the statement in response to new draft regulations that affect how HealthCare.gov and other ACA programs will operate in 2022.
In most HealthCare.gov states, health insurers now pay a user fee that amounts to 3% of premium revenue for coverage they sell through HealthCare.gov.
Several federal agencies are calling for in the new draft regulations for reducing the user fee to 2.25% of premiums in HealthCare.gov states, and to 1.75% of premiums in states that use HealthCare.gov systems to support state-run ACA public exchange programs. The agencies include the Centers for Medicare and Medicaid Services, the U.S. Department of Health and Human Services and the U.S. Treasury Department.
ACA Public Exchange Basics
The ACA public exchange system is supposed to provide a web-based supermarket for health insurance. Consumers can use the system to shop for coverage, sign up for coverage, and get ACA premium tax credit subsidies.
HealthCare.gov managers have slashed spending on nonprofit ombudsmen, or “navigators,” since Donald Trump became president, and they also have reduced spending on print and broadcast advertising.
Program managers have argued that using low-cost email and social media campaigns brings in almost as many applicants as the higher-cost advertising campaigns did, and that insurance agents and brokers have been much more effective than nonprofit assisters at bringing in applicants, without getting any cash directly from HealthCare.gov.