A Call for Stability on Cost-Sharing Reductions

Governor Charlie Baker testified before the U.S. Senate Committee on Health, Education, Labor and Pensions (HELP) on Thursday, arguing in favor of continuing the cost-sharing reductions that are included in the Affordable Care Act and that help insurance companies provide lower-income people with more affordable plans purchased in exchanges.  HELP Committee Chairman Senator Lamar Alexander (R-Tenn.) called for a bipartisan plan focused on addressing issues affecting access and affordability of insurance offerings in the individual market.

The Trump Administration has consistently sent monthly mixed messages about whether it will extend the cost-sharing reductions. “Month to month resuscitation of cost sharing reductions is not stabilization; they should be maintained for at least two years,” Baker said, adding, “I cannot stress enough how critical it is for federal cost-sharing reduction payments to be resolved affirmatively in order to maintain market stability and to constrain rate increases.”

Senator Elizabeth Warren (D-Mass.), a member of the HELP Committee, on Thursday was strongly critical of President Trump’s dithering on the CSRs.

Baker testified along with Governors Steve Bullock (D-Mont.), Bill Haslam (R-Tenn.), Gary Herbert (R-Utah), and John Hickenlooper (D-Col.). In his testimony Baker also called for “broader parameters for insurance market reforms that include greater latitude for states to meet the unique needs of their residents.” Specifically he called for states to be allowed to broaden so-called Section 1332 waivers, such as the one Massachusetts will be submitting shortly to create a premium stabilization fund in the event Congress does not appropriate funding for cost-sharing reductions. Baker and the other governors also pointed to rising pharmaceutical costs as a major problem.