Ex-Molina CEO, Blues plan executive sound off on ACA subsidies

Affordable Care Act highlighted
To the health insurance industry, there is perhaps not greater immediate threat to their individual market business lines than the uncertainty surrounding funding for the cost-sharing reduction program. Getty/Ellenmck

Though most health insurance executives have said little publicly about the political wrangling affecting their industry, the specter of rising uncertainty recently led one current and one former CEO to speak out.

Brad Wilson

The current CEO is Brad Wilson, of Blue Cross Blue Shield of North Carolina, who told Vox that he isn’t counting on the Trump administration to commit to funding the cost-sharing reduction (CSR) program next year. Thus, while he would have requested an 8.8% rate hike for 2018, instead he’s asking for a 22.9% increase.

Through the CSR program, the government pays health plans to reduce out-of-pocket expenses for Affordable Care Act exchange customers. But the program’s future is in jeopardy, as not only would the American Health Care Act halt its funding, but a lawsuit brought by House Republicans also challenges its legality.

Last week, a federal appeals court granted a request from Congress and the Trump administration to put the case on hold for another 90 days, which ensures CSR payments will continue for now but still leaves insurers in the dark about the future as they begin to file their individual market rates for next year. Despite mounting pressure from healthcare lobbying groups, the president and federal health officials have refused to commit to funding the subsidies after the suit is resolved.

To Wilson, the “biggest single reason” for BCBSNC’s double-digit rate hike is the lack of certainty about funding for CSRs in 2018. “The president and the administration have made several statements about CSRs that don’t give any comfort that they will be available,” he told Vox.

J. Mario Molina
J. Mario Molina

And Wilson isn’t alone in that opinion. J. Mario Molina, who in early May was suddenly ousted from his role as CEO of the California-based insurer his father founded, has been a vocal critic of Republicans’ healthcare plans—a stance he suggested contributed to his firing.

Molina doubled down on his position in a recent op-ed published by U.S. News & World Report, writing that Americans have been “duped” into believing that the ACA is failing when in reality, Republicans are the ones working to destroy it.

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Refusing to commit to reimbursing health plans for CSR payments, he argues, is “perhaps the most drastic way” that the Trump administration is threatening Americans’ access to health insurance.