Back in October, President Trump issued an executive order that halted the federal payments to state health insurance exchanges known as CSRs. These subsidies made it profitable for insurance companies to cover people at lower rates under the Affordable Care Act. Trump ended CSR (Cost Sharing Reduction) payments after the Republican-controlled Congress failed to repeal or replace the ACA—ostensibly because he considered the payments unconstitutional, but probably because ending the subsidies would push state insurance exchanges toward collapse.
It’s like my grandmother used to say: You can’t make an omelette great again without urinating all over it so people want you to make a new one. I miss her. Anyway, the companies on Montana’s insurance exchange had already submitted their 2018 rates when Trump stopped the CSR subsidies. The next day, State Auditor and Insurance Commissioner Matt Rosendale issued a statement saying that it was too late for the state to change.
“Any Montana consumer who purchases these products can be assured that my office verified that Montana’s insurers, whether receiving subsidies or not, are financially able to provide the benefits for the posted rates regardless of action taken at the federal level,” the statement said.
Insurance companies are in the business of predicting the future, after all, and plenty of people had predicted Trump would stop CSRs before he did. It seemed like insurers guessed wrong and would have to pay the price—kind of like I did when the premiums on my gold plan doubled over two years, so instead I got the bronze plan for $350 a month and wound up paying a $6,500 deductible when I dislocated my shoulder. Sometimes you guess right, and sometimes you give your whole margin to the hospital.
Commissioner Rosendale did not hold Montana’s insurance companies to that standard, though. Instead, he let them submit new rates, after the deadline, that reflected the disappearance of CSRs. Montana Health Co-Op, for example, originally filed for a 4-percent increase on its silver plans, but raised premiums another 24 percent after the news was announced. In response, Rosendale’s office issued another statement:
“My department was advised by both companies just months ago, that with or without [cost-sharing reduction] payments, they would be able to honor the rates they provided to us and the public,” he said. “Today, by their actions, they inform me that was not true.”
If only we had some kind of official whose job it was to regulate insurance premiums. Rosendale seems to be having it both ways, here. He let insurers file new rates after the deadline, even though they assured him before the deadline that losing CSRs wouldn’t change anything. Then he lambasted them for accepting his offer.
Yet criticizing him for complaining about the new rates is unfair. What is he supposed to do—praise insurers for raising premiums yet again? Rosendale has a difficult job, and he is in something of a lose-lose situation. Still, it is a situation of his own making.
Our state insurance commissioner has made no secret of his contempt for our national insurance system. As a Republican, he has attacked Obamacare and the state exchange, even as he has been charged with making it work. If his critics have taken his complaints about higher rates as disingenuous, it is because he has not convinced us that he actually wants the exchange to succeed.
Ironically, he may have saved it by letting Montana Health Co-Op and PacificSource raise premiums. Were those two insurers to take a bath in 2018, they might withdraw from the exchange in 2019, leaving us with only Blue Cross Blue Shield (which factored the loss of CSRs into its estimates and raised rates 23 percent before the deadline).
Rosendale has said he had no authority to prevent the rate hike—an odd claim, when the original deadline was specified by law—but he might as easily have framed it as a necessary evil to save the exchange. Instead, he has presented it to the public as a calamity beyond his control, the next stage in Obamacare’s inevitable collapse.
That’s an odd strategy from a man running for the United States Senate. As the only Republican candidate who holds statewide office, Rosendale will be known for his performance as insurance commissioner. It remains to be seen whether voters will respond to his message of, “Can you believe how badly this thing I’m in charge of is going, due to factors beyond my control?”
He’s in a bad spot, and it’s not fair to attack him for being against rate hikes, too. We all are. Unlike the rest of us, though, he’s in a position to do something. Thus far, his plan to let the exchange fail and then say he told us so has done little to distinguish him from the rest of his party.
Dan Brooks writes about politics, culture and the abject venality of the American health care system at combatblog.net.