The Senate Committee on health, education, labor and pensions will please come to order. This morning were holding our first hearing on stabilizing premiums and ensuring access to insurance in the individual Health Insurance market for 2018. We have five state Insurance Commissioners. Thank you for coming from long distances some of you to be with us to give your testimony on how to help the 18 million americans in the individual Insurance Market. To give an idea of how many people are interested in this, senator murray and i invited senators who were not on our committee which has about a quarter of the senate is on this committee, to come to a coffee with the five commissioners that we have just completed for an hour. We had 31 senators there. So thats remarkable level of interest. Senator murray and i will each have an Opening Statement then we will introduce our five witnesses, after their testimony senators will have an opportunity to ask witnesses questions and we will do it in fiveminute rounds. As i mentioned this committee includes 23 United States senators, nearly one quarter of the members of the senate. It includes senators with the widest divergence of views. It has a republican majority of only one. Yet working together during the last two years we have been able to agree on big steps, on big issues about which we have big differences of opinion. Such as fixing no child left behind, which president obama called the christmas miracle. 21st century cures which senator mcconnell the majority leader says was the most important piece of legislation that passed Congress Last year. The first overhaul of Mental Health laws in a decade. And in early august after two careers of work, and i want to thank the staff for that two years of work, especially, we passed new agreements to help speed safe drugs and devices into medicine cabinets and provide 9 billion for funding for the food and drug administration. I congratulate senator murray and democratic as well as republican members of the committee for those accomplishments. This is the way americans expect the United States senate to work. Now, those were big steps. This hearing is about taking one small step. A small step on a big issue which has been locked in partisan stalemate for seven years, Health Insurance. It is a step Congress Needs to take by the end of this month. By the end of this month. The step is not to big to 18 million americans, song writers, selfemployed farmers, those who dont get their Health Insurance from the government or on the job, these 18 million buy their Health Insurance in the individual market and about half of them have zero Government Support to help buy that insurance. 18 million is only 6 of those who have Health Insurance in america. So thats the individual market. Nearly 300 million americans have insurance, Health Insurance, 18 million have buy it in the individual market. Thats 6 of all the insured and 9 million of those 18 million have no government help to buy their insurance. They are the ones most hurt by higher premiums and higher copays and deductibles. Lets take a hypothetical tennesseen. A 43yearold making 18,000 a year would receive no tax benefit to cover her 7100 per year premiums. An estimated takehome pay of 39,000 after taxes which means almost a fifth of her takehome pay is spent on Health Insurance premiums and this doesnt include deductibles or copays. Next year the Tennessee Department of insurance says premiums will go up an average of 21 to 42 . Thatsen increase for her between 1,500 and 3,000 more in premiums next year and that doesnt include increases in deductibles and copays. She ought not to have to pay a fifth of her income for Health Insurance. Tennessees insurance commissioner who is here today has described the states individual market as very near collapse. At the end of september last year blue cross our largest insurer pulled out of the individual market in knoxville, nashville for everybody. That can happen again at the end of this september if congress doesnt act. And if it happens again up to 350,000 tennessee ans and millions of americans could literally be left with zero options to buy insurance in the individual market. Last year only 4 of american counties had one insurance commissioner on the exchange. This year 36 have one insurer on the exchange and for 2018 one half of the counties will have one insurer only on the exchange. In tennessee its 78 of our 95 counties. If we do act we can limit increases in premiums next year, 2018. We can continue support for copays and deductibles for many low income families, we can make certain that Health Insurance is available in every county and lay the groundwork for future premium dee suggestion creases. I would suggest we do this by taking two actions although there may be others that come from these hearings, one, appropriate cost sharing payments through the end of 2018 to help with copays and deductibles for many low income americans. Two, amend the section 1332 waiver already in the Affordable Care act so states can have more flexibility to devise ways to provide coverage with more choices, lower costs. On the first, cost sharing payments are extra subsidies or discounts really for many low income individuals who receive premium subsidies under the law. They help these individuals pay for outofpocket costs like copays and deductibles but their overall effect is to lower premiums in this individual market. On the second, the section 1332 waivers, as i said, are already written into the Affordable Care act under some circumstances they allow a state flexibility from certain elements of the law such as essential Health Benefits, but they do not in any way reduce the patient protections most of us support, including protections for those with preexisting conditions and insuring those under 26 may remain on their parents insurance and have no annual or lifetime limits. Right now 23 states have begun steps to apply for a section 1332 waiver, seven states have applied, two states, alaska and hawaii, have received the 1332 waivers so far. Now, to get a result democrats will have to agree to something, more flexibility for states that some may be reluctant to support and republicans will have to agree to something, additional funding through the Affordable Care act that some may be reluctant to support. That is called a compromise. A much smaller but similar agreement to the compromise that created this United States senate in 1789, when the founders created a senate with two members from each state and the house of representatives based on population that was a compromise. This is a compromise, that we ought to be able to accept. Temporary cost sharing payments were included in both the senate and the House Republican bills to repeal and replace major parts of the Affordable Care act. The section 1332 waiver is already in the Affordable Care act, it just hasnt been very appealing to states because its a difficult tool to use. We hope to hear more about that from our witnesses today. If we were able to take the big steps i mentioned earlier, fixing no child left behind, passing 21st century cures, we ought to be able to take this small limited bipartisan step on Health Insurance. If we dont millions of americans will be hurt. Timing is a challenge, so i propose that we try to come to a consensus by the end of next week when our hearings are complete so that congress can act on what we recommend before the end of september, otherwise, we wont be able to affect insurance rates and the availability for insurance next year. Thats because the department of health and Human Services requires Insurance Companies to submit their final rates by september 20 and the Department Plans to put those rates on healthcare. Gov by september 27th. I believe we can do it here because were plowing very familiar ground. Our goal is a small step and so Many Americans will be hurt if we fail. If we dont do it wont be possible for republicans to make political hay blaming democrats or democrats to make political hay blaming republicans. The blame will be on every one of us and deservedly so. So now let me conclude with a word about process. We will have four hearings, were hearing from state Insurance Commissioners today. Were hearing from five state governors tomorrow. We will hear from various experts on state flexibility next tuesday and a variety of helpful perspectives next thursday, including representatives from doctors, hospitals, insurers, patients and Insurance Commissioners. This is what we call a bipartisan hearing, most of our hearings are, that means that senator murray and i have agreed on the hearings, on its topic and on who the witnesses will be. This committee has a clear jurisdiction over the rules that govern the individual Insurance Market, which is what were discussing today. We have jurisdiction over private insurance, over the exchanges created by the Affordable Care act and over the cost sharing reduction payments. The purpose of the hearings is to provide a forum and create an environment for reaching a consensus that we can act on quickly during the month of september. Now, note that we do not have jurisdiction over taxes, including the Affordable Care act tax credit subsidy, nor over medicare, nor over medicaid. Those belong to the finance committee, although theyre at least nine members of that committee on this committee. There has been such great interest in this effort that senators that are not members of our committee are being invited to coffee each before each of the four hearings, as i said, 31 senators came to the one today. Senator murray and i have invited them to do that and to participate in this process. My goal is to get a result on a small, bipartisan and balanced stabilization bill. Where it makes sense we will work with other committees and members to get that result. Health insurance has been a very partisan topic for a very long time, but the bottom line is 18 million americans need our help. I hope we can stay focused on getting a result. Senator murray. Thank you very much, chairman alexander. And i do want to start by expressing my appreciation for your leadership in holding these hearings. It is refreshing to have an opportunity for frank and bipartisan discussions on the Healthcare System and consistent, as you said, with long standing tradition of working across the aisle on this committee. So thank you very much. Im also very grateful to each of the Insurance Commissioners who have come a long way to join us today. Your perspective is incredibly valuable in this discussion. Im looking forward to hearing from each of you, and i particularly want to acknowledge commissioner Mike Kreidler who came all the way from Washington State today, good to have you here as well. Were beginning these conversations at an important moment for patients and families. There is a lot of work that needs to be done to undo the damage this administration has caused within the Healthcare System because this administration is still trying to create trump care by sabotage. Our Healthcare System is more stable than president trumps tweets would have you believe, but it is weaker as a direct result of some steps that have been taken. Unfortunately, the president has undermined outreach and consumer assistance efforts and put forward executive orders seemingly designed to inject uncertainty into the markets. Just last week this administration cut funding for outreach by 90 and funding for consumer assistance by over 40 . And another pressing example is the threats to cut off payments, to reduce coverage costs for low income people. Should these outofpocket cost reductions be discontinued, independent analysis suggests that premiums could be an average of 20 higher next year for the most popular plans on the exchanges. There will be even more uncertainty in the markets and patients and families likely will have fewer options when they go to pick their plans. That is unacceptable and it is avoidable. Congress can act right away to confirm once and for all that outofpocket reductions will continue and we will have a very narrow window to do that as the chairman said before insurance finalizes their plans for 2018 later this month. I am very glad that there are members on both sides of the aisle who agree we do need to take the step and i believe it is critical we work towards a multiyear solution in order to provide the kind of certainty that have have the most impact on families premiums and choices in the marketplace. It takes plans months to develop their rates. If we dont find a multiyear solution we will just be back in this room trying to patch the same problem a few months from now and thats simple knew not what certainty looks like. This kind of discussion around strengthening our Healthcare System is what democrats had hoped for over the last few years. We put forward a number of ideas that would help stabilize markets and lower costs in the near term. As i said before as we Work Together im more than ready to consider additional ideas from the other side of the aisle to make our Healthcare System work better for our families and for patients but to be clear that means moving forward not backward on affordability, coverage and quality of care. Families have rejected the damaging approach taken in trump care which would have raised the families costs and gutted protections for preexisting conditions and congress should listen. I think we are all aware threading this needle will not be easy but i do believe an agreement that protects patients and families from higher costs and uncertainty and maintains the guardrails in our current Healthcare System is possible. This kind of agreement would not only make a real difference for the patients and families that we serve but it could provide a bipartisan foundation for future work. Ive said many times before this worked in when the Affordable Care act passed, its certainly true today. Theres much more we need to do to strengthen the Healthcare System, to lower costs, to expand coverage and improve quality of care and these are the issues we should be able to Work Together on in a bipartisan way. I hope with todays conversation we continue to turn the page away from trump care and partisanship that weve seen way too much of. Instead start working on healthcare policies to help our patients and families afford the care they need because that is the goal that we all should be focused on. Im so glad weve seen interest on both sides of the aisle for coming together and working to find Common Ground on these issues and i want to thank all of the commissioners and all of our colleagues joining us today and turn it back over again to chairman alexander. Thank you, senator murray. Our first witness is julie mcpeak, shes commissioner of tennessees department of commerce and president elect of the National Association of Insurance Commissioners. Shes testified here before. Welcome. Our second commissioner or witness is Mike Kreidler, senator murray has already welcomed him and acknowledged him, he is washingtons eighth insurance commissioner. The state of washington and the countrys longest serving commissioner. I will ask senator mccould you ski to introduce the next witness. Thank you, mr. Chairman. It is a pleasure to introduce to the committee an individual who has been before us before, director laurie wingheier is alaskas director of insurance. She has been in that position since 2014 and has done an exceptional job. We recognize not only her service there, but she is also the chair of the American Indian and Alaska Native Liaison Committee on the association of Insurance Commissioners. She is, as you have noted, one of or alaska is one of two states that has received a 1332 waiver and it has been under the guidance of director wingheier that we have seen that come about. So i thank her not only for being here today, but for her leadership and her persistence in working not only with the Obama Administration but with the Trump Administration in getting that final signoff. Thank you, senator murkowski. Senator casey, would you like to introduce the next witness. Thank you, mr. Chairman. Im pleased to introduce Theresa Miller who is pennsylvanias acting secretary of Human Services and former pennsylvania insurance commissioner. Secretary miller served as insurance commissioner from 2015 through august of this year when she was nominated by Governor Wolf to serve as secretary of Human Services. In her role as insurance commissioner shes been a vocal supporter of pennsylvanias Health Insurance marketplace, demonstrating a deep understanding of the Insurance Industry while advocating for policies in the best interests of pennsylvanians. I congratulate her on being nominated to serve as secretary of Human Services and happy to welcome her to the Health Committee today. Secretary miller, thank you for your testimony today. Were grateful youre here. Thank you, senator casey. Our fifth witness is john doak. We welcome you back, mr. Doak. You were here before to help us understand the issues. Hes commissioner for oklahomas department of insurance. He is well known for hosting Healthcare Innovation summits within his state which seek to offer Cutting Edge Solutions to the countrys healthcare challenges. As you already know from the meeting weve had earlier, there is a lot of interest here among senators, so if you could please summarize your remarks in about five minutes, we will then turn to a series of questions from senators to follow that up lets begin with you, ms. Mcpeak. Thank you. Good morning, chairman alexander, Ranking Member murray and members of the committee. I am julie mcpeak, commissioner of the Tennessee Department of commerce and insurance. Today i plan to highlight tennessees history with the aca and discuss some Immediate Solutions that congress can consider to stabilize the individual Insurance Market. Before i get started i would like to thank you for holding todays hearing and for inviting so many of my state regulator colleagues. In an interview last year i characterized tennessees individual Health Insurance market as very near collapse. In the 12 months since thankfully our market has not collapsed, but our market is not any more stable and probably less so. Tennessee in 2017 has continued to see Health Insurance carriers flee the market due to the tremendous uncertainty surrounding the 2018 plan year as well as year over year of substantial losses. As of today and subject to change until qhp agreements are signed later this month tennessee consumers across the state will have at least one option for coverage, but only one in the clear majority of our state. While we feel fortunate that tennesseeness will have an opportunity for coverage i dont think that many people believe that having a single choice in 78 of 95 counties represents ideal market competition. To summarize, tennessees experience over the last four years, our consumers have seen premium prices skyrocket while their plan choices have diminished. Tennessee had around a dozen carriers offering individual healthcare coverage in 2010, reduced to only three Companies Offering aca compliant plans in 2018. Tennessees current aca trajectory quite simply is not sustainable. Todays hearing couldnt be time clear as we are a proechg a september 20th deadline for final determinations on 2018 rate filings. Each carrier a contributing approximately 14 of their average rate increase to csr uncertainty. According to cms data approximately 120,000 tennesseeans are enrolled in csr plans. The csr funding issue is the single most important issue and to be clear this issue is not an insurer bailout. Csr funding ensures some of our most vulnerable consumers receive assistance for copays and deductibles required to be paid under federal law and has the affect of reducing premium increases and has a direct impact on the amount of subsidy assistance provided by the federal government. As you know last month the cbo reported federal deficits would increase by 6 billion in 2018 if csr funding is terminated. On the other hand should the federal government agree to fund csrs and cms works with the states tennessee we could see proposed increases for 2018 be reduced. Beyond csrs conks should establish a reinsurance mechanism that would stop losses for individual claims at a specified amount to increase Market Participation by carriers. For the most Immediate Impact this backstop mechanism must be federal. States should have the option and flexibility to set up their own programs to reflect our unique dynamics and market conditions, but the federal government should set up a default mechanism to stabilize markets during any transition to a state run program. Following these immediate measures csr funding and reinsurance Congress Must address broader aca reforms such as benefit design, rating restrictions and the underlying cost of healthcare. As the cost of Healthcare Services increase so too must be the cost of Health Insurance. This causal relationship is simple to understand yet is too often not discussed in conversations of Health Insurance reform. Health insurance rate requesting are subject to review by state insurance departments. In tennessee the rate review process is in an entirely public one. As soon as a rate is filed it is publicly accessible to anyone interested. Rates are filed and approved on a plan year bases that prohibits rate changes during the year and provides consumers notice before a rate increase for the following year. These parallel protections are nonexistent in the pharmaceutical industry and this level of transparency is lacking. These issues cannot remain to be unaddressed and our focus on Health Insurance rates and accessibility. In conclusion consumers need access to quality Health Insurance coverage at affordable rates. We can get back to a vibrant market where shoorpers look to expand rather than retract their operations. After addressing these issues congress should focus its attention on broader conversation of our Nations Health and strategies to improve Health Outcomes while reconsidering tenets of the aca. Thank you again for your time. I look forward to answering your questions. Thank you, ms. Mcpeak. Mr. Kreidler. Good morning, mr. Chairman. And Ranking Member murray, members of the committee. My name is Mike Kreidler and im the insurance commissioner for the state of washington. I want to thank you for your bipartisan commitment to address the challenges that we as Insurance Commissioners are facing, but also you are facing in the coming months. This is especially true for the individuals and families who buy their own Health Insurance, some 330,000 people in the state of washington. They really are the the health of that market is really the canary in the coal mine. If there is a problem in the individual market, it is a problem for all of us. This is made up as you pointed out chairman alexander, is early retirees, selfemployed people who work for employers who dont offer Health Insurance, the individual market is clearly a very critical safety net. We rely they are relying on us to find a path forward that offers a great deal more certainty than what we have right now. Washington state has fully embraced the Affordable Care act from the very beginning. We have a very stable market since 2014. Our uninsured rate has plummeted from 15 down to under 6 in the state of washington, but this year there has been a serious jolt to the system. Initially we had two counties in the state of washington that didnt have any health insurers. We solved that problem, thankfully, but im nervous about whats going to happen next year. Because of the growing uncertainty and actions by the administration, our individual Health Insurance markets are in serious peril. The proposed average rate increases that weve seen for 2018 are 23 . In years past its been under 10 . Nine Rural Counties have only one insurer, one major insurer, largely pulled back in our state completely from western washington where most of the people live. The next two weeks are going to be very telling. Insurers will be making their final decisions as to whether theyre going to participate in the Health Insurance marketplace or not. Congress must act quickly to address these growing uncertainties. You must permanently fund the cost sharing reduction payments. Thats something thats going to help a great deal in our marketplace. It affects some 72,000 people in the state of washington for a low income family in the state of washington, the deductibles is the difference of being 1200 with the csrs or 14,000. I rj you to create a federal Reinsurance Program this year. Doing this would be would show your commitment to stabilizing the market. It worked very well in the state of washington for the first three years that we had a Reinsurance Program. Wed like to see it continue and go forward. Its another way of reassuring the Insurance Market that an and insurance carriers it doesnt help them financially but it gives them predictability and helps us hold down the rates. Make sure that you maintain the coverage and affordability guardrails in the 1332 waivers. Im willing to play by the rules, what we dont want to see is that essential Health Benefits, the guarantees on outofpocket costs are eroded away. Those are Consumer Protections that nobody wants to see leave the marketplace. In closing let me say that you must take bold action now to shore up these markets. Millions of hard working families and individuals are counting on us. In Washington State we have firsthand experience with what can happen if violating basic insurance principles are allowed to occur and they are occurring right now. We tried this in the 1990s and we saw the individual market in the state of washington totally collapse. Believe me, thats something no one wants to go through. Let me be a harbor here and say this, it can and will happen if you do not take action now. Thats how critical it is out there in that Insurance Market to make sure we dont have that kind of collapse we saw in washington happen for the whole country in the individual market. Lives depend on it, our lives rest on your bipartisan efforts. Thank you, mr. Chairman. Thank you, mr. Kreidler. Ms. Wingheier. Thank you for the opportunity to testify today about the Health Insurance market in alaska. And the need for congressional action to help people in the individual Insurance Market. In 2018 and beyond. Alaska has amongst the highest cost of healthcare in the nation due to low population density and limited Healthcare Provider or facility competition in much of the state. While the individual mandate reduced the number of uninsured alaskans, an unintended consequence was that the high cost of individual Health Insurance premiums increased even further. Premiums in the individual market in alaska have increased by 203 since 2013. On average an alaskan in 2013 was paying a monthly premium of 344 per month and in 2017 that premium is 1041 per month. To stabilize this volatile market the division of insurance worked with Governor Bill Walker to create the alaska Reinsurance Program. The 29th Alaska State Legislature passed the governors bill in 2016 with overwhelming bipartisan support. The alaska Reinsurance Program is intended to provide stability to the individual Health Insurance market, mitigating rate increases by removing high cost claims. As planned, this had an Immediate Impact on rates. Prior to enacting the Reinsurance Program, indications were that the rate filing from the single insurer in alaska would be close to 40 in 2017. After enactment the rate increase was a moderate 7. 3 . An independent actuarial analysis estimates the Reinsurance Program will increase enrollment in the individual market by 1,650 individuals, modeling also indicates that the program may attract healthier members to the individual market further reducing premiums. After enacting the Reinsurance Program alaska then applied and was subsequently approved for a federal aca section 1332 state innovation waiver. Alaska raised the requirement of a single risk per pool and proposed that the federal government provide pass through funding for a period of five years to secure the states Reinsurance Program. The pass through funding is based on the savings generated as a reduction in the advanced premium tax credits. It is estimated that the alaska Reinsurance Program will save the federal government 51. 6 million in advanced premium tax credits in 2018 relative to what would have been the Tax Liability had the program not been put into place. After the federal pass through funds are accounted for the state will be responsible for providing approximately 15 of the 55 Million Program costs necessary to stabilize the individual market. As you consider congressional action to stabilize premiums across the country in 2018, we cover the following perspectives, we would urge congress to not disrupt the Health Insurance market, but instead focus immediately on stabilization. Any decision made after the filings are approved could cause unintended, unfavorable disruption to Insurance Markets. Uncertainty destabilizes the market. Committing to funding cost sharing reduction payments through at least 2019 will keep premium rates from increasing at even higher rate. We support collaborative reforms developed in consultation with state regulators that strengthen markets with a goal of Health Insurance not only being accessible but affordable. Programs that allow states to address the unique needs of their citizens such as the section 1332 waivers are vital to the longterm stability of Health Insurance markets. Further deliberation on Health Insurance taxes are needed. In particular citizens of states like alaska that already faced extremely high cost healthcare cost may be unfairly penalized by the cadillac tax. Additionally exempting insurers from Health Insurance tax in counties or states served by one insurer may be an effective way to increase competition that will benefit citizens but should be considered by all states as a moratorium. Please consider continuing and funding the navigator and sister programs. In rural areas of alaska Insurance Brokers and consultants are hard to find. These programs reduce the number of uninsured citizens and maximize Market Participation. Media and public announcements are vital to open enrollment being successful. A review of regulations may reveal some that are unnecessarily burdensome and costly to both medical providers and insurers. We are also interested in coordinated efforts with Healthcare Providers to address the underlying drivers of healthcare spending. Even under the extreme might considerations you faced 2018 premiums please make your decision in a bipartisan manner after thorough analysis. We are here to assist you in any way we can and i look forward to your questions. Thank you. Thank you, ms. Wingheier. Ms. Miller, welcome. Good morning, chairman alexander, Ranking Member murray and members of the committee. Im honored to be here today and want to applaud the committee for hosting such an important conversation at such a critical point in time. Im not going to sit here this morning and tell you that the aca is perfect, i think we all know that its not, but the narrative that the aca is failing and imploding is just false and ignores the coverage requirements that the law put in place. Millions of americans have benefited from the aca and the employer markets br the majority of people get their insurance have seen a moderation of costs since passage of the aca. Pennsylvanias uninsured rate is now the lowest its ever been thanks to improvements in the market. Pennsylvania has about 426,000 people on the individual marketplace and about 80 of these enrollees receive subsidies to help them pay their premiums and more than half benefit from cost sharing reductions that help them pay with their outofpocket costs like copays and deductibles. So for most individuals in this market the aca is working well. The aca has resulted in millions of pennsylvanianess no longer being denied coverage due to a preexisting condition and benefiting from quality comprehensive coverage because of Preventive Care and essential Health Benefit requirements. Pennsylvanias market has experienced difficulties but our individual market is not collapsing. Our individual market insurers filed for an average increase of just 8. 8 for 2018, assuming no changes to the aca. Im pleased to report that our insurers are finally seeing improved experience with this market and thats reflected in their rate increases, but im also very concerned that that stability is on fragile ground because of the ongoing uncertainty surrounding the future of the aca and in particular payments for cost sharing reductions. I cannot stress enough how difficult this uncertainty is on our markets. These payments have a Significant Impact on rates and failing to make a longterm commitment will do nothing but drive up costs for consumers. This will further hurt the 1 to 2 of pennsylvanians, roughly 125,000 people who dont receive subsidies because those who do will be shielded mostly from these premium increases if their insurer stayed in the market, that is. Ultimately rates have to be finalized based on finite assumptions. Pennsylvania consumers will be left to bear the burden of premium increases or lessened choices necessitated by continued uncertainty. Congress should allocate money for these payments through at least 2019 to give insurers the predictability they could desperately need. We also must make sure were properly encouraging enrollment in the individual market. The health of any Insurance Market depends on the strength of its risk pool and reduced enrollment strains the risk pool and contributes to rising costs for all of those in it. I worry steps the Trump Administration has taken could further erode the risk pool. Just last week we found out the extent of cuts to outreach and enrollment efforts funded by the federal government. Health and Human Services will spend just 10 million advertising 2018 open enrollment compared to the 100 million spent for 2017. In addition to this funding granted to Health Insurance navigator organizations to help people enroll was almost halved from the levels in the previous administration. Reducing outreach efforts combined with a shortened Enrollment Period will leave people without coverage and raise rates for people left in the market. In pennsylvania were implementing our own outreach program, working alongside insurers, Healthcare Providers, consumer advocates and other stake homtders to reach our common goal of increasing covered pennsylvanians. Encouraging enrollment helps everyone. People have access to coverage, insurers have a more robust risk pool and providers are more likely to receive compensation for care they provide. Over time a more robust risk pool should result in lower premiums for consumers. As we work towards providing stability in the market we should consider all options to moderate the premium increases. A 15 billion Reinsurance Program in the con tektd of a careful bipartisan approach to improving our Healthcare System would be a great place to start. Especially if the individual mandate were preserved and outreach was boosted to increase enrollment. The acas Reinsurance Program successfully moderated premiums while it was in place and a reintroduction of a longterm program could be an effective way to scale whack the premium increases we currently see. I do think we need to have a Serious National Conversation about healthcare costs in in this country. These costs are growing and even if we bring stability to our markets we must still address healthcare costs if we want to ensure our Current System is sustainable in the longterm. This is a national issue. Even as states work to address rising costs in our own markets we will not be able to fix this complete on our own. The healthcare reform gate has been without question partisan, the goals we are trying to achieve are not and neither is recognizing the real problems that exist in our system. We all want americans to have access to the kafr they need and be able to afford that care and we all want them to have choices and that means supporting a competitive Health Insurance marketplace that provides that choice. Im grateful for your leadership, chairman alexander, and im so thankful we are finally moving in the direction of working together to find Real Solutions to all consumers have access to quality Affordable Care. Mr. Doak, welcome. Thank you, senator. Good morning, chairman alexander, Ranking Member murray. One of the things before we get started today our hearts and prayers are with those folks that are in the line of hurricanes and we want to keep them in our prayers today and i would ask for speedy consideration for the flood reauthorization act with all that on our minds. Good morning. I appreciate the opportunity to testify today to provide an oklahoma perspective on stabilizing the individual Health Insurance market for 2018. For years we have been dealing with the negative consequences of obamacare, ive been warning with spiking rates, Narrowing Networks for too long. My warnings have been ignored at the federal level. I look forward to seeing how congress will address these problems in time for carriers to meet their deadlines. The implementation of obamacare in oklahoma has been a failure, it has created market disruptions without meaningful reduction in the number of uninsured in our state. In 2014 our izes is chose plans from five different carriers on the fed real facilitated marketplace, those carriers sustained heavy losses and by 2017 that number had dropped to only one carrier. Whats happening cant be sub stained and we cant we can expect eventually oklahomans will have no market and no options. Not only do they have one marketplace carrier to choose from but over the past four years rates have increased by 130 . Studies estimate approximately 30,000 individuals who do not qualify for premium assistance exited the nongroup market in oklahoma between 2016 and 2017. Small Business Owners and selfemployed individuals who are the backbone of oklahomas economy are suffering. As premiums have spiked, enrollees have experienced deductibles shock and cant afford the coverage. Many people in oklahoma where the average per capita income is just above 25,000 annually are being forced to pay higher premiums for a policy they cannot afford to actually use. Further, as carriers have sustained large losses in the marketplace they have responded by their in owing their provider networks. Many other states are facing similar issues. Unfortunately all recent efforts to repeal and amend obamacare have failed and states like mine have been left holding the bag. Im encouraged by the Trump Administration priorities particularly in encouraging state flexibility and autonomy. In oklahoma obamacare gives us no other options at this point. Oklahoma has submitted a 1332 waiver application under the obamacare framework. This application focuses on the creation of a Market Stabilization Program using federal pass through funding and statebased assessments. This would create a Reinsurance Program for carriers operating in the marketplace. This initial plan estimated to reduce premiums and increase enrollment in the marketplace in 2018, subsequent waivers will regain state control over other obamacare requirements, however, i am not convinced that obamacare waivers are going to be the solution to our problem. What we really need is an innovative longterm solution that truly returns powers back to the states to implement ideas tailored to fit each states specific needs in Health Insurance. Thats why ive been encouraged that proposals that are out there like ones from senators graham and cassidy which would repeal the individual and employer mandates, block grant dollars to the state. This kind of leadership and flexibility to the longterm stability of our markets. If some states want to keep their regulations from obamacare, thats great, if that works for them, but that isnt working for oklahoma and we should have the opportunity to do Something Different or else we face an uncertain and difficult future on this current flawed path. In conclusion, former senator dr. Tom coburn recently said if you want to fix healthcare, fix the markets. I do not think government will ever fix healthcare, only markets will. For more information please see my written testimony which includes letters i sent in january to House Majority leader mccarthy and chairman alexander. These letters outline several other Innovative Solutions to our insurance problems. Thank you very much, mr. Chairman. Thank you, mr. Doak. And thanks to each of you. We will now begin a round of fiveminute questions. We will begin with senator enzi. Thank you, mr. Chairman. I want to thank the panel for not only what youve said, but whats in your testimony. It will be helpful to us in a number of solutions. I will begin with ms. Wingheier. I know that alaska has been faced with some dramatic premium increases in the country and potential loss of carriers on the exchange and you set up that Reinsurance Program to address premiums and working through that section 1332 waiver now that also includes several market reforms. Can you talk about what youre seeing from the waiver and what you might look for and what some of the impediments might have been to getting the waiver. The waiver process is somewhat onerous in the fact that there is not a defined application to submit. So the states that are applying are hoping that they are providing the data requested by cms, including the actuarial analysis, the Economic Impact and proving that they are staying within the guardrails to be given the waiver. After that is done, the part that is stifling states right now is the sixmonth waiting period before they receive final approval. The first part of the waiver, as far as the application, the actuarial analysis and such can be done in a period of a couple of months. But then you wait after cms is giving the first approval for up to six months to know if you will receive final approval, your funding or the ability to go forward with any state innovation that you may find would benefit the citizens in your state. I will tell you that cms was very helpful to us, but it still was a rather lengthy process. So you can probably provide us some suggestions as you just did for simplifying that process. We submitted and worked with cms on some reforms that we thought would help. I do not believe theyve been adopted. Im quite sure theyve not been adopted. But we did submit some comments to cms on things that could improve the waiver process. Thank you. Mr. Doke, oklahoma faces similar challenges to wyoming, were practically neighbors. We have only one insurer offering individual coverage on the exchange. Can you talk about the challenge that it creates with one carrier holding all the risk . I know that wyomings blue cross sustained some real losses last year and i might talk about those later in their first year as the only carrier offering coverage. What changes would you suggest that could encourage more competition in the individual market for states like oklahoma and wyoming . I know you had some of that in your testimony, if you could share that with us. Yes, sir, senator. Thank you very much for that question. And we do share some of the similarities with your state. While our blue cross has had a huge amount of losses, much like yours, one of the things i think that we can do is as long as were under the current framework that were operating under, under obamacare, the 1332 waiver is and funding the csrs is the right way path to go ahead unless we make other dramatic changes in the future. In my letter that year stated i see many options for oklahomans in the future Small Business are bearing the brunt of these unintended consequences, so i think other types of vehicles that can be used, i for one believe buying across state lines is a possibility. But again, also offering maybe more catastrophic type plans as we talked about earlier this morning, for oklahomans to be able to have choices for what types of carriers and services and deductibles they have. The more choices we can give consumers in my opinion is the right thing to do for my state and others. Thank you. I notice that miss mcpeak mentioned a stop loss of a specific amount. Mr. Krieg ler mentioned a federal stop loss and unusual mashl market changes were mentioned by virtually all of you. I know in wyoming we had a carrier that found out two boys each had 30,000 prescription each, each year, but that was bought out by the primary company, so the generic went away and it went to one in threetenths million each. So they had a two in 6 million hit from just one family. So i appreciate your comments on that. And my time is about to expire here. I will be asking in writing for some suggestions from you on ways to do that stop loss at a specified amount and how the federal government ought to have a role in it and what the state role should be. Thank you. Thank you, senator enzi. Thank you for staying within five minutes, setting a good example. We have lots of senators here today. Senator casey. Mr. Chairman, thank you. I want to thank the chairman and Ranking Member murray for making this hearing possible and the subsequent hearings as well as the roundtables. When i was going across pennsylvania in august i was in 32 of our 67 counties. And when i could announce were having Bipartisan Health care hearings was an audible sigh of relief. So were grateful for the opportunity. Secretary miller, i wanted to ask you in particular about, a, that weve got, i think, a broad consensus emerging at least about the importance of the cautionary reduction payments, socalled csrs, and i think more discussion now as well about 1332, the waiver. You said on page pages six and seven of your testimony that you felt that the 1332 waiver process could be streamlined to minimize administrative burden. Im paraphrasing here. While also protecting the guardrails of the waiver program. Can you walk through that, in particular the concerns you have about maintaining those socalled guardrails . Explain that. Thank you. Thank you, senator casey. I think from pennsylvanias perspective as we think about potentially looking at a 1332 waiver, the current process is very cumbersome. We would have to pass legislation. We would have to go through public hearings and then go through the process that i think alaskas familiar with in terms of working with cms. So its a long process to get there. I think the more we could streamline that process the better off it would be. I think if states have the opportunity to submit a letter from their governor as opposed to having to pass legislation to move forward on a 1332 waiver that would be very helpful in allowing us to respond to market changes and trying to make sure our markets are stable going forward. I dont mean to sound greedy, but if we could have some planning funding available to help us really think through how this would work, i think that would also be very helpful. Also having flexibility around the 1332 waivers and 1115 waivers, the medicaid waivers, to think about those in conjunction in terms of the budget neutrality requirements as opposed to looking at those individually for those requirements. But i think as we move forward could you explain by what you mean by that, please . Sure. So in the 1332 waivers and the 1115 waivers each have requirements for budget neutrality. And i think for states if we want to be even more innovative, being able to think about those waivers together instead of having to think about them separately and having the overall budget neutrality requirement looked at as a pool and from just a strict is this budget neutral together would be very helpful. And it would allow states to be more innovative in thinking about that. But i do think to your point, senator casey, i do think the baseline coverage requirements are really important in ensuring that whatever we do doesnt result in fewer people covered or doesnt erode the coverage. I think, you know, a lot of us up here hear from consumers on a regular basis about high deductibles and concerns about other out of pocket costs that maybe they dont expect when they go to use their care. We want to keep those baseline coverage requirements intact as much as possible. But the more we can streamline that process, make it easier for states to respond to market dynamics, that would be helpful. The other thing i want to ask you about is what happens to folks in the age category 50 to 64 . We know for example the rate of uninsured adults ages 50 to 64 drop by some 47 from 11. 6 to 6. 1 between december 13 and march 15. Obviously good news there of huge drop by almost 50 . In the context of your experience in pennsylvania, how has pennsylvania stabilized its marketplace while also protecting older pennsylvanians not yet elder for medicare meaning 50 to 64 age category, how have we done in terms of accessing more Affordable Care . So i think the Current System protects Older Americans and older pennsylvanians. I think the 3to1 age ban that we currently have in the aca helps make sure that older pennsylvanians can afford that coverage. I think a lot of us as we think about stabilizing these markets are focused on getting more young, Healthy People into the risk pool. I think if we can find ways to do that that are not on the backs of Older Americans thats the way to do it. I think a lot of us have talked about expanding enrollment, funding, advertising and funding navigators so that we have assistance getting people enrolled. All those are ways that we can boost enrollment without doing it on the backs of older people. Great. Thank you, mr. Chairman. Do you have another question . Im good. Okay. Thank you. Senator paul. I think the chairmans done a good job at sort of focusing on the problem and so is the panel. I mean, the problems in the individual market and its 6 in the marketplace. I think though that we have ignored sort of whats working in the Insurance Market. There are parts of the Insurance Market that are working. Maybe we should look at those and try to figure out how we get more people into the parts of the marketplace that are working and how do we get them out of the part of the marketplace thats not working. So 6 of the individual in the marketplace, 36 of the people are in the large group selfinsured marketplace. And i think you can make the argument that it works better than anything else, probably has the lowest increase in rates over time, people are protected. They have large groups they can have leverage to get cheaper prices. They have a pool of people theyre a group of where theyre protected against one person getting sick. So i would argue that the worst place and the possible place in the whole world to be is in the individual market. You shouldnt want to be there. And my question is a more fundamental question, can you fix it . And is it morally or ethically right to take money from the taxpayer and give it to Insurance Companies to subsidize people in the individual market . Maybe we ought to give people an exit. Lets let people get the hell out of the individual market. Mr. Doak has talked a little bit about this with the Health Associations in his state. I would go a step further. There are 2 million fast food restaurants in our country. About 15 Million People work in the fast food industry. These are our lower wage working class citizens, these are the people who are struggling, the people still not even insured under obamacare. These are the people we should want to help. Lets let them become part of the arisa plans. Lets have nationwide Health Associations. What if one person were negotiating for 50 Million People . Youre bound to get a better price. The phenomenon of walmart. Theyre a bigger purchaser of things, they get a better price. Lets legalize that. It would cost the taxpayer nothing. Lets say people can associate with other people and buy insurance. Get the heck out of the individual market. I would prefer there be no individual market. I think its an artificial construction of attaching insurance to your taxes. When we did that we created the individual market and then we have big insurance comes to washington with their hands out. They made 6 billion a year in profit before obamacare. They now make 15 billion a year. Csrs are money youre giving to the insurance company. All this money is being given to big insurance. Dont give it to them. Let the individuals get into the Group Marketplace and who pays for that . Comes out of the 15 billion they make in the group market. What a scam. They come here and make tons, billions of dollars in the group market but then they whine they cant make it in the individual market. They cherry pick, they love the group market and stay in it and say were not going to sell it in the individual market. Well, lets equalize the individual and give them the power to negotiate with the insurance company. Doesnt cost anything. All were doing is legalizing collective bargaining for consumers. We should like it on this side of the aisle. And while senator sanders and i dont often agree on things, if there are a few people left that are uninsurable or have a preexisting condition, i would rather buy them health care than give money to the insurance company. It makes no sense to try to buy insurance for people who cost a Million Dollars a year who we already know whats wrong with them. Put a Million Dollars in for somebody buy them health care. Dont buy them insurance. You can do all these fancy reinsurance things and all these backstops. They dont work. Were subsidizing an individual market that does not work. It just is a nonfunctional you can never get there. People say its too expensive. New cars are too expensive. I have a Stabilization Fund for new cars, for ipads, iphones, anything that costs too much, put a bunch of taxpayer money in make it lower by giving money to the people who provide these things, people who make the iphones, people who supply college. I think we ought to look at it a different way. Lets dont try to fix the individual market. Lets try to get people an exit ramp to get the heck out of the individual market completely. For those who cant, or who dont, that we have to provide health care for, why dont we look at actually buying health care for them rather than buying insurance for them . Mr. Doak, if you want to respond, if you have any numbers on what your Health Associations have done and whether or not its put a dent in helping people from the individual market get into the group market, id appreciate it. Thank you. Yes, sir, thank you. At this current time the oklahoma health, we have the legislation in place at the state level, but there are some frameworks around the bona fide actual definition of an association, which i think needs a closer scrutiny to be able to open up. I do agree with you that associational Health Care Plan bills while it may differ from my colleagues respectfully, but i do think there is that could be a very viable market for folks to band together, whether, you know, as you mentioned folks in the Restaurant Business or the flower industry, wherever that might be to ban together to purchase coverage. And we know theres folks that can facilitate that in the marketplace. So i do agree with you on that, senator. Thank you, senator paul. Senator franken. Before i begin, i want to thank you, chairman alexander. And i want to thank Ranking Member senator murray. Health care is such an important personal issue that affects millions of americans, and thats why im heartened that were having these bipartisan hearings to discuss common sense reforms that will stabilize markets and Lower Health Care costs for consumers. I just wanted to spend a moment on the correct pronunciation of insurance, which is insurance, not insurance. Thank you. Now, whether the commissioners here today pronounced it correctly, i think you all agree that we should have reinsurance, or reinsurance. And i believe that all but mr. Doak, who by the way mispronounced it, spoke explicitly on the importance of continuing cost sharing and all of those who talked about it, cost sharing for multiple years. Now, mr. Doak, was that are you for continuing the cost sharing . Is that franken or franken . Im sorry. I think i see you mispronounced doak. Thats good. Thats good, sir. My position is under the current obamacare network, we must continue under the current framework were working under unless its changed we do need to continue the cost sharing agreements. I think we have consensus. Good. So we all have consensus on this panel of actual people who do actual are heads of insurance in their states that we should continue cost sharing and that we should do reinsurance. So, commissioner mcpeak, its nice to see you again. As you know, minnesota has applied for a 1332 waiver to set up a federal state Reinsurance Program to help reduce Health Insurance premiums. My hope is that the administration will prove this waiver quickly. As documented in a New York Times article that ran this past weekend, my state Insurance Program has bipartisan support passed in the state legislature, bipartisan support, and if approved it would reduce Health Insurance premiums by about 20 . And as the article notes this reduction would help all minnesotans buying Health Insurance on the exchange, not just those with the most costly health care needs. Other states like, mr. Doaks oklahoma, are considering proposals. Senator alexander, i would like to ask unanimous consent that this article from the New York Times be submitted for the record. It will be. Commissioner mcpeak, in your testimony talk about the importance of federal reinsurance, the federal Reinsurance Program or a federal Reinsurance Program, what advantages does a federal Reinsurance Program offer compared to a statebased approach . Thank you for the question. And i will try to pronounce insurance correctly. But i am from the south, so i dont have any guarantees there. I will say the federal Reinsurance Program has a benefit for states like mine that may not have the ability to up front the seed money to get our own program started everyone in the 1332 waiver process. You can ask me whatever you want to, betty. Thats great. We are welcome to rules committee. We are continuing the conversation that we have with members, Ranking Members, subcommittee chairman and we are going to move our appropriations process further today. My colleagues from the Democratic Party have asked me to go ahead, were in the middle of the afternoon, they know whats going