The following comments were submitted by Richard Besser, MD, Robert Wood Johnson Foundation (RWJF) President and CEO, in response to the Centers for Medicare and Medicaid Services’ (CMS) request for information on ideas for innovative programs and waiver concepts that states could consider relating to section 1332 of the Affordable Care Act (ACA).
RWJF is the nation’s largest philanthropy dedicated to improving health and well-being in the United States. Since 1972, we have worked with public and private sector partners to advance the science of disease prevention and health promotion, train the next generation of health leaders, and support the development and implementation of programs and policies to foster better health across the country, including high-quality health care coverage for all. We are working alongside others to build a Culture of Health that provides everyone in America a fair and just opportunity to live the healthiest life possible.
RWJF has a longstanding commitment to coverage, which were established in the following principles in April, 2007:
- Good health is necessary for everyone in the United States to participate fully in society, and a healthy population is vital to the productivity and economic and social well-being of our nation.
- Health care is critical to good health and should be available to all regardless of race/ethnicity, age, gender, geography, or income.
- Health insurance coverage is essential for access to necessary and appropriate health care and should be available to everyone in America.
Therefore, we believe that:
- Health insurance coverage should be affordable. Individuals should contribute to the cost of their care, however, the cost of health insurance and the out-of-pocket costs incurred in accessing care should not force individuals to choose between health care and other basic necessities of life.
- Health insurance coverage should include necessary, appropriate, and effective health care services.
- Health insurance coverage should be continuous and portable, bridging life span, employment, and geographic relocation.
- Health insurance coverage should promote high-quality and cost-effective health care.
- Health insurance coverage should be based on shared responsibilities between the public and private sectors and individuals. These responsibilities include the oversight, management, and financing of the health care system.
We have a long-standing commitment to working with states to expand health care coverage in accordance with these principles. For instance, the State Health and Value Strategies (SHVS) program assists state agencies and officials in their efforts to transform health and health care systems to provide care that meets people’s goals and needs, including by providing technical assistance to states seeking to expand access to coverage. Part of this assistance involves working with states on 1332 applications (see the map of states pursuing 1332 waivers and tools for states here).
We also support a variety of other activities intended to increase transparency in insurance markets and consumer education, including providing technical assistance to navigators; supporting consumer representatives at the National Association of Insurance Commissioners (NAIC); and sponsoring competitions for those creating consumer decision support tools.
As part of our work with states and helping states to leverage 1332 waivers to expand coverage and address affordability, we have learned that one urgent challenge is protecting the integrity of the insurance market for people with pre-existing conditions. Specifically, waiver ideas that include allowing lower-risk individuals to use federal tax credits to purchase coverage that removes them from the individual market risk pool would leave the traditional individual market with higher-risk, more expensive individuals. The practical effect of such a policy would be to significantly increase premiums for people buying coverage on the individual market. While state flexibility is an important goal, we do not believe it is as important as protecting and expanding access to high quality, affordable coverage for everyone.
Alternatively, we have focused on models that can encourage maintenance, or even growth, in consumer participation in the individual market that can encourage increased choice and lower premiums. For example, in early 2016, the SHVS program engaged with officials in Alaska to assist in the creation of the first reinsurance waiver and the program subsequently worked with five of the six states that followed Alaska’s model. The reinsurance waivers have been incredibly successful, resulting in significant savings for consumers and forming a model of federal-state cooperation to improve affordability and access, while protecting consumers. SHVS is eager to continue to help states in this way.
Another policy option that is gaining traction among many states is to leverage their purchasing power to create more affordable options that maintain protections for people with pre-existing conditions. These proposals have been called “public options” or “buy-in” programs and what they can mean is a state providing access to a plan that the state procures on the individual market or as part of a state’s Medicaid program. As states drive lower prices for care, premiums can be lowered for consumers while at the same time protecting consumer choice. Such a program could create savings captured through a 1332 waiver.
As RWJF continues to work with states to develop new waiver ideas, protecting affordable coverage of populations most at risk of inequities, including those at lower income levels and those with pre-existing conditions, is a core value. We want to take this opportunity to note that we have previously encouraged CMS to take a broad approach in its consideration of state innovation for the purpose of 1332 waiver applications. It is critically important that new models being developed by states and those approved by the Administration promote affordability for everyone; protect people with pre-existing conditions by assuring that they can retain coverage that is both affordable and comprehensive; and allow states to leverage their purchasing power to create models that meet the needs of the people in their states, especially those most at risk of inequities. We also strongly encourage state and federal officials to meaningfully engage the people most likely to be impacted by these waivers in their design.