CONCORD — A federal waiver request to President Donald Trump’s administration could result in nearly $45 million in savings and could lower health care premiums by 15% for people who get insurance coverage in the individual market, Gov. Chris Sununu announced.
This change came from the compromise, two-year state budget that called on the Insurance Department to ask federal authorities if it could create a state-based reinsurance program.
The agency estimates this plan would save the federal government from having to pay out $31.1 million in advance premium tax credits. The state’s share of these credits is equal to $13.5 million.
Sununu said his request is to permit all these savings, $44.6 million, to be redeployed so the three companies writing insurance in the individual market could reduce premiums charged to individual customers.
The waiver is needed to deal with a lack of more health care reform coming out of Congress, Sununu said.
“Preserving and stabilizing New Hampshire’s individual health insurance market has been a key priority for our administration. Our previous efforts have kept our state’s three current insurance companies in the market and have lowered premiums for two consecutive years,” said Sununu. “However, continued dysfunction and lack of reform in Washington is likely to produce increased prices next year that could put health care out of reach for too many Granite Staters.”
State officials explored this idea back in 2017 but it wasn’t profitable for the state because the Medicaid expansion population was being served through the individual market and the Trump administration would not credit all those savings.
Since then, managed care companies have taken over providing coverage to the Medicaid population and that change makes savings through reinsurance for the individual market much greater and state costs much lower, Sununu said.
“The individual market in New Hampshire has been under stress for years,” said New Hampshire Acting Insurance Commissioner Alex Feldvebel. “I hope that by implementing a well-crafted reinsurance program, we can strengthen the individual market — both in terms of company participation and in terms of covered lives and general consumer confidence. We have seen the negative impacts of high premium costs on people’s financial well-being and health, and the governor and Legislature have directed the department to take action.”
Senate Majority Leader Dan Feltes, D-Concord, who is a Democratic candidate for governor in 2020, said Democratic legislative leaders called for this change.
“I’m glad the administration is following through with the requirement to submit this waiver as passed by the Democratic Legislature to help reduce health care costs,” Feltes said.
In 2018, the Trump Administration announced additional options for states pursuing these waivers and most states that got them in 2019 had double-digit premium savings, Sununu said.
Three insurance companies offer individual plans in the New Hampshire marketplace: Anthem, Ambetter from NH Healthy Families, and Harvard Pilgrim Health Care, according to the department.
Consumers can buy plans outside the federal marketplace, but state officials warned against companies like Aliera Companies and Trinity HealthShare, which the state last fall ordered to stop selling or renewing what it called “illegal health insurance” in the state. Aliera also marketed its products under the company name Ensurian.
The individual health insurance market has 44,000 people in it through the federally facilitated exchange (HealthCare.gov) and 10,000 people outside the exchange.
Individuals whose income was too high to qualify for premium subsidies experienced very steep increases and many left the market, Feldvebel said.
Unlike the group market, these customers were vulnerable to much higher premiums due to a proportionally large number in that pool with high health care costs.
The Insurance Department will hold two public hearings this spring on the proposed risk-sharing plan and application for federal funding.
The dates and locations for the hearings will be announced once the venues are confirmed, officials said.