Marketplace Archives

Michigan at a crossroads: CHRT highlights key health policy issues for the incoming gubernatorial administration

The Michigan government has jurisdiction over a wide array of health policy issues. From the regulation of insurance products, to oversight of the state’s Medicaid program, to investing in local public health efforts, Michigan policymakers craft policies and budgets that impact the health of millions of Michiganders.

This brief provides an overview of four key and timely health policy topics:

Medicaid and the Healthy Michigan Plan;
the individual health insurance market and the federal Health Insurance Marketplace;
the opioid epidemic; and
the integration of services to address the social determinants of health.

With the expansion of Medicaid and the launch of the Affordable Care Act’s individual Health Insurance Marketplace, the numbers of uninsured Michiganders have been considerably reduced since 2013. Yet Michigan policy makers will still face numerous policy issues and decisions related to health care coverage, health disparities, and access to care in the years to come. Our state will continue to struggle with complex health issues such as substance use and access to mental health services.

Michigan policy leaders, local public health agencies, and the private sector are engaged in many innovative initiatives to address these issues and improve the health of communities. In particular, the state has committed to programs that are intended to improve health equity and focus on the social determinants of health.

All of this work is being conducted at a time of great political change and considerable turmoil at the federal level. The new governor and the 100th Legislature will be faced with both tremendous responsibility and opportunity to shape the health policy landscape for years to come.

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Setting the stage for the 2019 Health Insurance Marketplace

The Centers for Medicare and Medicaid Services is rolling back regulations around rate increases, essential health benefits, health insurance navigators, and more, for insurers offering Qualified Health Plan coverage on the Health Insurance Marketplace in 2019.

On April 9, 2018, the Centers for Medicare and Medicaid Services (CMS) issued new guidance for insurers offering Qualified Health Plan (QHP) coverage on the Health Insurance Marketplace created under the Affordable Care Act. In this guidance, CMS made several important changes intended to provide states with greater flexibility to regulate their individual and small group health insurance markets beginning in 2019.1

In a new fact sheet, CHRT compares the current rules and regulations to the changes that go into effect in 2019—with a special focus on Michigan. The face sheet reviews essential health benefits, health insurance navigators, maximum out-of-pocket limits, standardized plan options, rate increase reviews, medical loss ratio, risk adjustment, silver loading, individual mandate hardship exemptions, projected premium and federal spending changes, and the timeline for the 2019 filing process in Michigan.

Here are just a few highlights:

Rate increases under 15 percent will no longer require review;
Simple choice standardized plans will be eliminated; and
Consumer cost-sharing limits will increase by 7 percent.

These changes to the 2019 Health Insurance Marketplace will impact Michigan consumers as soon as November 1, 2018, when the next Marketplace Open Enrollment Period begins.

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Update: For more information about the 2019 Health Insurance Marketplace, read our rate analysis.

Health Care Provisions in the Tax Cuts and Jobs Act (H.R. 1)

Buttons decorated like the American flag, with "Tax Cuts and Jobs Act" written on them.

The Tax Cuts and Jobs Act passed the U.S. House of Representatives on November 16, 2017, and an amended version passed the U.S. Senate on December 2, 2017. Congress reconciled the differences between the two bills in a compromise conference report.

While the purpose of the legislation is to reduce tax rates for businesses and individuals, it includes several major health care policy changes.

For instance, the act repeals the tax penalty for those who choose not to enroll in health insurance. CBO estimates the impact of this will be that 13 million fewer individuals will have health insurance over 10 years and health insurance premiums for ACA Marketplace plans will increase an additional 10% per year.

The Tax Cuts and Jobs Act also lowers the threshold of health care tax deductions from 10% to 7.5% of income for 2017 and 2018. This means that more taxpayers and more expenses will be eligible for the deduction.

Finally, the act limits the tax credit amount for pharmaceutical companies that develop drugs to treat rare diseases from 50% to 25% of qualified clinical testing expenses.

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Editor’s Note: CHRT updated this fact sheet Jan. 12, 2018 to include more recent Medicare beneficiary numbers, updated information on PAYGO, and reflect that the conference report is now law.

Rate analysis: Michigan’s 2015 Health Insurance Marketplace

On November 15, 2014, Michigan’s ACA Health Insurance Marketplace launched its second annual open enrollment period. During this period, which runs until February 15, 2015, Michigan residents can shop for health plans and determine if they are eligible for financial assistance to decrease the cost of coverage for the coming year.

Compared to the first open enrollment period, the Michigan marketplace saw large increases in the number of available health plans and, in certain areas, considerable changes in premium costs. These changes are especially important for residents who enrolled in 2014 marketplace coverage and plan to enroll again before the end of the 2015 open enrollment period.

All marketplace analysis was completed using 2014 and 2015 qualified health plan individual market medical plan data available at data.healthcare.gov. Notably, there are new benchmark plans (second-lowest cost silver plans) in nearly all (81 out of 83) Michigan counties. Changes in benchmark plans are an important factor in calculating the amount of premium tax credits marketplace applicants may be eligible for. Applicants in counties where the local benchmark premium decreased may be eligible for smaller tax credits, all other factors being equal.

The changing dynamics of the health insurance marketplace are particularly important for 2014 enrollees. Under current federal policy, enrollees who did not actively apply for and enroll in 2015 coverage by December 15 were auto-renewed into their 2014 plan, if it continued to be offered. Due to increases in new plan options and changes to benchmark plans that affect tax credits, many enrollees may have been better off actively selecting a 2015 plan that met their coverage needs.

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