Over the past months I have been inundated with requests for campaign contributions, and I looked for a way in which to make informed decisions about which candidates to support. In last month’s blog post, I shared two questions I posed to Iowa candidates running for U.S. Congress, the Iowa governorship, and the Iowa Legislature. The questions asked were an effort to engender better knowledge of just two of the complex issues surrounding the Affordable Care Act (ACA). At that time, I said I would make a $1,000 campaign contribution to the candidate who provided the most-specific answers to my questions and allow the responses to be posted on this blog. If I received thoughtful responses from several candidates, the $1000 contribution would be shared.

To date, I have received only one response, that of Senator Jack Hatch, who is running for Iowa governor. I have posted his response below. I sincerely appreciate Senator Hatch’s response. The opportunity for candidates to submit a response to my questions remains open until August 15. S.S. McClure, editor and publisher of McClure’s Magazine, once said, “The vitality of democracy depends on popular knowledge of complex questions.”  I seek candidates’ answers for just two of the many complex questions surrounding the ACA. Please let the candidates you support know about this campaign-contribution opportunity. Help me share “popular knowledge about complex questions.”

July 30, 2014

Response to Dr. David Carlyle’s Health Care Reform Challenge from the Hatch/Vernon Gubernatorial Campaign.

Question 1. Should Iowa have a state-based health-insurance Exchange? If yes, why and how would this state-based Exchange be designed and implemented? If your answer is no, please explain why.

RESPONSE:

Yes. In the 2013 and 2014 sessions of the Iowa legislature, I introduced a bill in the Iowa Senate, most recently Senate File 2112, to create a state-based health-care Marketplace (Exchange) as proposed in the Affordable Care Act (ACA). The bill provides for a statewide Exchange managed under a plan adopted by an Iowa board of directors, in consultation with the state insurance commissioner. The Exchange would facilitate the purchase, reimbursement, and payment of premium costs under the rules set down in the Affordable Care Act. Individuals would be allowed to sign up for coverage through an Internet site constructed by a reputable firm with experience in the area. Qualified health-care plans offered on the Exchange would be assigned a rating as set out in the ACA.

The lack of a state Exchange is important because, as we saw in the D.C. Court of Appeals decision issued July 22, 2014, the federal subsidies offered to participants in plans accessed through the federal Exchange could be determined to be invalid — for more than 29,000 Iowans — because of the way the ACA language was drafted. There is no question about subsidies for plans accessed through state Exchanges. This places subsidies for Iowans in jeopardy and may force Iowans to subsidize health insurance subsidies for residents of other states while being prohibited from accessing the same federal benefit.

There are other reasons to establish an Iowa Exchange, including quality control over the operation of the website and potentially faster responses to Iowans wanting to purchase a health-care policy and policyholders who wish to access their policy.

Perhaps the reason that gives me the most motivation is that Iowa government has a reputation for performing in an efficient, fair manner when compared with the federal government and other state governments. I am certain our state could construct a successful Exchange to meet the needs of Iowans.

BACKGROUND INFORMATION ON SENATE FILE 2112

The purpose of SF2112 is to provide for the establishment of a health insurance Marketplace (Exchange) in our state to facilitate the sale and purchase of qualified health-insurance plans by qualified individuals in the individual market and by qualified small employers in the small-group market category in Iowa. The intent of authorizing the establishment of a health insurance Exchange in the state is to reduce the number of uninsured individuals in our state, provide transparent operation of the Marketplace, provide adequate consumer education, assist individuals with access to relevant federal and state programs, premium assistance tax credits, and cost-sharing reductions. The Iowa health insurance Marketplace would be established as a nonprofit corporation. The Marketplace shall be established for the purpose of facilitating the sale and purchase of qualified health plans by qualified individuals in the individual market in this state and by qualified small employers in the small-group market in this state.

The Marketplace shall operate under a plan of operation established and approved by a board of directors, in consultation with the commissioner. The plan shall effectuate the purposes of this chapter and assure the fair, reasonable, and equitable administration of the Marketplace. The board shall do all of the following pursuant to the plan, including but not limited to:

1. Plan, direct, coordinate, and execute the administrative functions of the Marketplace.
2. Employ professional and clerical staff as necessary.
3. Keep an accurate account of all activities, receipts, and expenditures of the Marketplace and annually submit a report to the commissioner, governor, general assembly, and the auditor of state concerning such accountings pursuant to section 514M.14.

The Marketplace shall be operated on a statewide basis.

The Marketplace shall include separate Marketplace components which facilitate the sale and purchase of qualified health plans to eligible individuals and to small employers as described in this chapter and in the federal act.

The Marketplace may establish a reimbursement system for health-insurance plans issued in this state that all health carriers and health-care providers may join to facilitate fair and reasonable payments for the cost of health-care services provided pursuant to a health-insurance plan.

The Marketplace shall do all of the following:

1. Facilitate the purchase and sale of qualified health plans to qualified individuals and qualified employers as described in this chapter and in the federal act.
2. Establish rate schedules for commissions paid to insurance producers by qualified health plans offered through the Marketplace.
3. Meet the requirements of this chapter and any rules adopted pursuant to this chapter.

A person who selects, purchases, or enrolls in a qualified health plan offered through the Marketplace shall be enrolled in the plan by an insurance producer or may enroll in the plan directly through the Marketplace Internet site. The commission paid to an insurance producer who enrolls a person in a plan offered through the Marketplace shall be established by the Marketplace.

On the anniversary date of coverage obtained through the Marketplace, an enrollee may renew or enroll in coverage offered through the Marketplace through any insurance producer of the enrollee’s choice or may enroll directly through the Marketplace Internet site. A commission shall be paid to an insurance producer who renews or enrolls a person in coverage under this paragraph in the same manner as is provided in above.

The Marketplace may contract with an experienced and reputable entity to develop and maintain the Marketplace’s Internet site. The entity shall preferably have relevant experience in developing and maintaining similar state health-insurance-plan Internet sites.

The Marketplace may employ staff to carry out the functions of the Marketplace, but no employee of the Marketplace shall sell, solicit, or negotiate enrollment in a health insurance plan or otherwise offer services for which a license as an insurance producer is required pursuant to Chapter 522B.

The Marketplace may contract with an eligible entity to fulfill any of its specialized duties or responsibilities as described in this chapter. An eligible entity includes but is not limited to an entity that has experience in individual and small-group health-insurance plans, benefit administration, or other experience relevant to the responsibilities to be assumed by the entity. However, a health carrier or an affiliate of a health carrier is not an eligible entity for the purposes of this subsection.

The Marketplace may enter into information-sharing agreements with federal and state agencies to carry out its responsibilities under this chapter provided such agreements include adequate protections with respect to the confidentiality of the information to be shared and comply with all state laws and rules and federal laws and regulations.

Each qualified health plan offered through the Marketplace shall be assigned a rating by the Marketplace in accordance with criteria developed by the secretary under section 1311(c)(3) of the federal act, and the Marketplace shall determine the level of coverage of each qualified health plan in accordance with regulations issued by the secretary under section 1302(d)(2)(A) of the federal act and applicable state law. If a qualified health plan offered through the Marketplace meets or exceeds the criteria for a qualified health plan set forth by the secretary, the plan shall be reviewed and assigned a rating by the Marketplace.

Question 2. Regarding health coverage for Iowans, is it possible to eliminate pre-existing-condition discrimination without either an individual mandate (with or without a complementary employer mandate) or a single-payer health-care system? If it is possible, how would your proposed health-insurance system work to eliminate requirements related to pre-existing conditions?

RESPONSE:

I am not aware of a method of eliminating pre-existing conditions from health-insurance coverage without making use of one of the avenues outlined in the question. I believe the most workable solution is an individual mandate supported by subsidies. Iowa has been a leader in making a public investment in the health of working families through Medicaid. We also are an established leader in the country in providing health insurance to kids through the HAWK-I program. There is no reason we cannot also achieve national leadership in extending health-care coverage to working adults who otherwise would have no access to coverage, by requiring coverage and subsequently providing incentives and subsidies to them. This is the approach of the federal Affordable Care Act. It is workable in Iowa.