Attacked by Trump, insurers tout economic impact in CT, other states
Washington – Under attack from President Donald Trump, the nation’s insurers hit back Monday with a report aimed at showing the industry’s impact on the U.S. economy and the economies of every state, including Connecticut where it said health insurers are a $1.15 billion business.
The study, released by America’s Health Insurance Plans, or AHIP, said the health insurance industry employs 9,544 people in Connecticut and their average annual salary is $120,366, much higher than in all other states. That’s probably a result of the large number of insurance executives who live in Connecticut.
The report, based largely on U.S. Census and other federal government reports as well as industry data, said the industry generates another 12,513 insurance-related jobs in the state, including those held by brokers, reinsurance company employees and those who work as independent claim adjusters.
It also said health insurers paid the Connecticut government about $208 million in premium taxes last year.
Nationally, the report said health insurers cover about 170 million Americans, and employ – directly or indirectly – more than 1.4 million people.
The nation’s health insurers are angered by Trump’s decision to end an Affordable Care Act payment known as cost haring reduction (CSR) payments. Those payments go to insurers that sell “silver”-tiered health plans on state insurance exchanges, like Access Health CT, to low-income Americans who qualify for reductions in out-of-pocket costs, such as deductibles and co-pays.
Trump administration officials said they could not continue the payments because they were not appropriated by Congress.
The president, who announced the end to CSR payments Friday, characterized them as “subsidies” to insurers and tweeted the next day he was glad the decision hurt insurers.
“Health Insurance stocks, which have gone through the roof during the ObamaCare years, plunged yesterday after I ended their Dems windfall!,” Trump tweeted.
On Monday, Aetna, Anthem and Cigna stocks were still down by about 1 percent from where they were before the president’s announcement. United Healthcare stock recovered fully on Monday from Friday’s drop.
Trump continued on Monday to say he was happy with his decision to end CSR payments.
“So, the insurance companies have made a fortune with Obamacare — an absolute fortune,” Trump said at an impromptu press conference in the Rose Garden. “As you know, what I did with the cuts at the end, which were all going — you know, you’re talking about hundreds of millions of dollars a month going right into the pockets of the insurance companies. And I’m very happy with what I did.”
Under the ACA, insurers must continue to offer low-income Americans who qualify – about 44,000 of them in Connecticut – reduced copayments and deductibles.
Unless Congress acts to restore the payments, insurers will no longer be reimbursed for losses they may accrue from these discounts, which totaled about $50 million annually in Connecticut and about $7 billion nationally.
The Connecticut Insurance Department allowed the two insurers that sell “silver” plans on Access Health CT — ConnectiCare and Anthem — hefty premium increases for 2018 to cover the expected loss of the CSR payments.
But in other states, exchanges are scrambling to keep insurers and considering delaying the Nov. 1 enrollment start date for 2018 policies.
While Connecticut has allowed for increased premiums in 2018, insurers will still lose revenue because they are not expected to receive CSR payments for October, November or December of this year — months in which they have no allowed premium increase.
Congress may come to the rescue.
For weeks, bipartisan members of the Senate Health, Education, Labor and Pensions Committee have been working on a short-term “fix” of the Affordable Care Act that probably will reinstate the CSR payments.
At Monday’s press conference, Trump indicated he supported the effort.
“I believe Republicans and Democrats are, as we speak, working together very hard, right now — working together to do an intermediate plan, a short-term plan, because Obamacare is a disaster,” he said. “The rates have gone up. The premiums have gone up. The deductibles have gone through the roof. I mean, it’s terrible. If you look at the deductibles, unless you really have a problem, you’re not going to be able to use them.”
Connecticut Attorney General George Jepsen on Friday joined a group of fellow attorneys general from more than 20 states suing the Trump administration over the end of CSR payments.
Their lawsuit says the president did not follow the law when he ended the payments because the payments are mandated by the ACA and have been made since 2014.
They are seeking a temporary injunction from a federal court to make sure the October CSR payments, due on or around the 21st of the month, as well as subsequent monthly payments, are made.
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