Top Takeaways from this week – (1) The Senate HELP Committee held two hearings to discuss market stabilization with state insurance commissioners and governors; (2) the Senate Finance Committee has also announced a hearing on health care costs and coverage; and (3) the Senate Parliamentarian ruled that budget reconciliation instructions to repeal the ACA will expire at the end of the fiscal year.

Congress returned from their August recess this week to a packed legislative agenda, which may complicate its ability to complete work on health care legislation. Although President Trump has renewed calls for the Senate to repeal and replace the ACA, the Senate Parliamentarian has determined that rules allowing the Senate to repeal and replace the ACA with only 50 votes will expire at the end of the month, significantly shortening the timeline to pursue wholesale repeal and replace.

The Senate HELP Committee has instead begun to focus on a more narrow effort to stabilize the marketplaces in time for the 2018 open enrollment period, and plans to hold four hearings between this week and next week in order to build consensus on stabilization legislation by the end of next week. HELP Committee Chair Alexander (R-TN) noted In a hearing yesterday that “If Congress acts quickly we can limit increases in premiums in 2018; continue support for co-pays and deductibles for many low-income families; make certain that health insurance is available in every market; and lay the groundwork for future premium decreases.” Press release:

Congressional Activity –

Market Stabilization

Senate HELP Committee Chair Alexander (R-TN) and Ranking Member Murray (D-WA) held two hearings this week addressing market stabilization policy, hearing from state insurance commissioners yesterday and from governors today.

In his opening statement yesterday, Committee Chair Alexander (R-TN) noted:

“This is about taking one small step on a big issue which [has] been locked in a political stalemate for seven years – health insurance. This step is not so small to 18 million Americans—songwriters, the self-employed, farmers—those who do not get their health insurance from the government or on the job. … To get a result, Democrats will have to agree to something – more flexibility for states – that some are reluctant to support. And Republicans will have to agree to something – additional funding through the Affordable Care Act – that some are reluctant to support.”

The discussion with insurance commissioners focused on the need for appropriations for cost-sharing reduction payments, streamlining the 1332 waiver process and providing states more flexibility under 1332s, and establishing a reinsurance program. Other potential changes or issues raised included allowing the purchase of so-called “copper” plans, amending the individual mandate, and the need for greater outreach and enrollment assistance from the federal government to support Open Enrollment.

Governors were fairly aligned with the insurance commissioners in their recommendations to Congress, arguing for multi-year funding for CSR payments to issuers, greater flexibility for 1332 waivers, and for a temporary “stability fund” for reinsurance. Governors also raised the potential benefit of allowing copper plans to be sold.

In both hearings, HELP Committee Chair Alexander called for a narrow legislative package solely consisting of one year of payments for cost-sharing reductions to lower out-of-pocket costs combined with “significant changes in flexibility for states – probably, mostly through changes to section 1332 since it’s already in the Affordable Care Act.” He noted today that legislation is not likely to include any other provisions, including for reinsurance, and cautioned Democrats against pushing too hard against 1332 flexibility, noting “To get a Republican President, a Republican House, and a Republican Senate just to vote for more money won’t happen in the next two or three weeks unless there’s some restructuring.”

In an op-ed in the Washington Post yesterday, Ranking Member Murray (D-WA) called for at least two years of CSR payments, noting “we need a multiyear solution to offer certainty to patients and families and to truly help prevent premium increases.” She further added a note of caution with respect to 1332 flexibilities, noting “I will reject any effort to use this process as a back door to pass parts of Trumpcare that would erode protections for people with preexisting conditions – for example, women seeking maternity care or those with mental illness or substance-use disorders.” Op-ed:

Next week, the HELP Committee will hear from other health care stakeholders on market stabilization and state flexibility. Chair Alexander is pushing for market stabilization legislation to be drafted by the third week of this month in order to pass it by the end of the month.

ACA Repeal and Replacement

The narrow, and bipartisan approach to market stabilization is in contrast to continued efforts by some Senate Republicans and the White House to build support for the Graham-Cassidy proposal, which would largely repeal and replace the ACA. Administration staff have been working with Sens. Graham (R-SC) and Cassidy (R-LA) on their proposal, which would block grant federal healthcare funding to the states. Sen. Cassidy is hoping to have new bill text finalized by this week, noting “We are still refining the legislative language – just things you got to clear up. We think we have good legislation, good policy.”

Yesterday, Sen. McCain (R-AZ) announced he would consider supporting the Graham-Cassidy bill as long as it went through regular order, and White House Advisory Kellyanne Conway said that President Trump supports it, noting, “The President’s ready, he’s ready with pen in hand to sign health-care reform if, say, Graham-Cassidy moves forward. A lot of the governors seem to be supportive of that, people have been working on that very strongly over the recess.”

While Sens. Graham and Cassidy are optimistic that they could gain support for their bill, there are a number of high-priority legislative efforts also culminating this month. Further complicating the timeline is a ruling from the Senate Parliamentarian last Friday finding that the reconciliation instructions that allow Senate Republicans to repeal parts of the ACA under a simple majority will expire at the end of the fiscal year, or September 30. Because the House GOP fiscal year 2018 budget resolution does not include health care instructions, any action to repeal and replace the ACA after September 30 will be subject to normal rules requiring 60 votes for passage.

Meanwhile on the House-side, Reps. MacArthur (R-NJ) and Meadows (R-SC) have reportedly reached an agreement on a market stabilization bill, which Rep. MacArthur has described as composed of three main pillars: funding CSR payments, giving states more flexibility through 1332 waivers, and fighting high drug costs. Additionally, the Problem-Solvers Caucus is also backing a proposal similar to what is forming in the Senate HELP Committee.

Stakeholders have continued to write to Congress, urging their support for market stabilization legislation. AHIP, Blue Cross Blue Shield of American (BCBSA), the American Hospital Association, and the Chamber of Commerce, among other stakeholders sent a letter to HELP Committee Chair Alexander (R-TN) and Ranking Member Murray (D-WA) on Tuesday urging the Committee to “ensure that cost-sharing reduction (CSR) benefits are continuously funded for at least two years (2018-2019). Consumer, patient and provider organizations have also written to Congressional leadership, urging funding for CSRs, reinsurance, and additional funding to help with open enrollment. Letters: and