Alexander, Collins Statement on Bills to Lower Health Insurance Premiums

WASHINGTON, December 20, 2017—United States Senators Lamar Alexander (R-Tenn.) and Susan Collins (R-Maine) today jointly released the following statement:

“Rather than considering a broad year-end funding agreement as we expected, it has become clear that Congress will only be able to pass another short-term extension to prevent a government shutdown and to continue a few essential programs,” said the Senators.  “For this reason, we have asked Senator McConnell not to offer this week our legislation which independent analysts Avalere and Oliver-Wyman say would reduce premiums by about 20 percent for the 9 million Americans who have no government subsidies to help them buy insurance in the individual market. Instead, we will offer it after the first of the year when the Senate will consider the omnibus spending bill, the Children’s Health Insurance Program reauthorization, funding for Community Health Centers, and other legislation that was to have been enacted this week. 

“Also, in order to succeed, our legislation must be bipartisan, and the Senate Democratic leader said on Tuesday that Democrats would not support it in the current environment even though as recently as October he said that all Democrats would. 

“There is every reason to believe that these important provisions can and will be delivered as part of a bipartisan agreement. And Majority Leader McConnell has told us that he will uphold his commitment to schedule and support the legislation. 

“Americans with no government subsidy for health insurance have seen their premiums more than double on average over the last five years, making health care unaffordable for millions of people. The Alexander-Murray legislation, which funds cost-sharing payments and gives states more authority to reduce rates, was introduced by 24 senators, half Democrats and half Republicans. The Collins-Nelson risk pool proposal was supported by almost every witness who came before the Senate's health committee during our four hearings on stabilizing the individual market. President Trump and Majority Leader McConnell support these bipartisan bills. And House Republicans voted for similar proposals earlier this year in their repeal and replace bill. Earlier, the Senate Democratic leader said that every Senate Democrat would vote for it.”

Senator Lamar Alexander (R-Tenn.) added: “It looks like the Christmas present of lower health insurance premiums will now have to be a Valentine’s Day present. It is hard to add our bills to a year-end package that does not yet exist. I am grateful to Senator Collins for her strong and steady leadership and to the 22 other Senate Democrats and Republicans who have cosponsored legislation to help drive down these intolerable insurance premium increases. I am confident that after the first of the year members of both houses will be eager to include our legislation in what was to have been the year-end package of bills.”

Senator Susan Collins (R-Maine) added: “I appreciate the thoughtful and bipartisan effort that Chairman Alexander has led in the Senate health committee, and I look forward to working alongside him and Ranking Member Murray to enact these bipartisan bills and help make health insurance more affordable. This afternoon Speaker Paul Ryan called me and said that the House remains committed to passing legislation to provide for high-risk pools and other reinsurance mechanisms similar to the bipartisan legislation I have introduced. He pointed out that by waiting until early next year, we will be able to use a new CBO baseline that will result in more funding being available for reinsurance programs that have been proven effective in lowering premiums while protecting people with pre-existing conditions like diabetes, heart disease, and arthritis.”

On background:

• In a December 9 report, Oliver Wyman said of the package, “We estimate that with $5 billion in funding, states collectively could provide more than $15 billion in reinsurance coverage, and that this, combined with the funding of CSRs, would result in another 700,000 people with coverage in the individual market and premiums that were more than 20% lower than if the individual mandate were repealed and the package of provisions was not implemented.”

• On December 6, Avalere said, “In combination, CSR funding and $5B in annual reinsurance could lower 2019 premiums by 18% and increase enrollment by 1.3M people.”

• In a December 15 letter to the senators, the National Association of Insurance Commissioners said, “Providing reliable federal funding to reimburse health insurance carriers for the Cost-Sharing Reduction (CSR) program assistance they give to low-income consumers and grants for states to establish invisible high risk pools or reinsurance programs would reduce premium increases as much as 20% and could encourage some carriers to stay in the market. Such funding is not a “bailout for insurers” as some have argued, but rather goes directly to improving the availability and affordability of health insurance for our most financially vulnerable consumers.

• In August, the nonpartisan Congressional Budget Office said that cost-sharing reduction payments are terminated, “premiums for silver plans offered through the marketplaces would be 20 percent higher in 2018 and 25 percent higher by 2020.”