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Insurance sign-up funds cut again

U.S. says nonprofits’ ‘navigators’ fall short, agents do better

WASHINGTON -- President Donald Trump's administration announced that it is slashing grants to nonprofit organizations that help people obtain health insurance under the Patient Protection and Affordable Care Act.

This will be the second round of grant cuts in as many years. The government will provide $10 million this fall, down from $36 million last fall and $63 million in 2016 -- a total reduction of more than 80 percent.

Trump administration officials said insurance counselors, known as navigators, did not enroll enough people to justify more spending. Insurance agents and brokers do much better, they said.

The announcement Tuesday by Seema Verma, the administrator of the Centers for Medicare and Medicaid Services, came three days after the administration suspended a program that stabilizes health insurance markets by paying billions of dollars to insurers that enroll large numbers of unhealthy people under the Affordable Care Act. Insurers said the freeze would cause turmoil in insurance markets and drive up premiums.

The administration is not only cutting grants to navigators but is also fundamentally changing their mission. They will, for the first time, help people enroll in health insurance plans that do not comply with the consumer protection standards and other requirements of the Affordable Care Act.

Since they began work in 2013, navigators have helped people enroll in health plans that comply with the Affordable Care Act. Now the Trump administration says they should inform consumers of other options, like "association health plans" and short-term, limited-duration insurance.

Such plans do not have to provide health benefits like preventive services, maternity care or prescription drug coverage, but administration officials say they also will be more affordable to consumers.

"It's time for the navigator program to evolve, which is why we are announcing a new direction for the program today," Verma said.

In each of the past two years, she said, navigators enrolled less than 1 percent of the people who signed up for coverage in the federal marketplace. In the most recent enrollment period, about 8.7 million people signed up for coverage in the 39 states that use the federal marketplace, the administration said.

Sen. Ron Wyden of Oregon, the senior Democrat on the Finance Committee, expressed anger at the administration's effort to redefine the purpose of the navigator program.

"This move amounts to federally funded fraud -- paying groups to sell unsuspecting Americans on junk plans," Wyden said.

Having failed to persuade Congress to repeal the Affordable Care Act, the president is now engaged in a "sabotage crusade" to wreck the law, Wyden said.

Trump declared last fall that the Affordable Care Act, signed into law by President Barack Obama in 2010, was "dead" and "gone," but it has proved to be durable. Nationwide, in federal and state marketplaces, 11.8 million people signed up for coverage in the last open enrollment period, down from 12.2 million in the previous year but substantially more than many experts had predicted.

The Trump administration on Tuesday defended its decision to cut grants to insurance counselors, saying consumers had many other ways to learn about their options. It said, for example, that insurance companies had "significantly increased their marketing and promotional spending."

However, insurance companies typically push their own products, while navigators are not supposed to favor or recommend a specific company or product.

In addition, the administration said the insurance exchange is now "an established marketplace" for people seeking coverage. "Last year," it said, "we had our most cost-effective and successful open enrollment to date. As the exchange has grown in visibility and become more familiar to Americans seeking health insurance, the need for federally funded navigators has diminished."

Verma said grants to navigators would be based on their performance in past years. Some, she said, had performed poorly.

In 2016-17, she said, 17 navigator groups enrolled fewer than 100 people each, at an average cost of $5,000 for each person enrolled.

By contrast, she said, agents and brokers accounted for more than 40 percent of enrollment in the federal exchange for the current year, and the cost to the government, for training and technical assistance, was just $2.40 for each person enrolled.

Agents may receive commissions from insurance companies -- typically modest payments for marketplace plans -- but navigators are generally forbidden to accept compensation from insurers.

The Trump administration said it was also eliminating a requirement that navigator groups have a physical presence in the areas they serve. Navigators can help consumers fill out applications, complete enrollments and renew coverage online, the administration said.

A Section on 07/12/2018

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