Think your state has Obamacare problems? They’re nothing compared to Guam
by Sarah Kliff, Washington Post, December 19, 2013 (excerpts)
…Because of a quirk in the Affordable Care Act's drafting, the Northern Mariana Islands and the four other American territories are subject to some parts of the law but not others. This has messed up the individual market in the Northern Mariana Islands so badly that the one plan selling policies there told the territory's top insurance commissioner it would not sell new plans for 2014.
In other words: Beginning Jan. 1, regulators expect it will be literally impossible for an individual to buy a new policy in the Northern Mariana Islands, and difficult in other territories.
"In the 50 states and D.C., everybody is crying about the Affordable Care Act not working," says Sixto Igisomar, the regulator. "You multiple those things exponentially for us."
The problem, in its simplest form, is this: While the Affordable Care Act requires health insurers in the territories to accept all shoppers no matter how sick, it does not mandate that all territorial residents buy plans nor does it provide subsidies to make coverage more affordable--as it does in the 50 states and the District of Columbia.
The problems stem from how Congress drafted the Affordable Care Act, including the territories in some provisions but not others. New insurance regulations--like the requirement to sell to all shoppers, cover a larger suite of benefits, and limits on premiums--were included as amendments to the Public Health Service Act. American territories do fall under that law, and must comply with its requirements.
The individual mandate and insurance subsides, however, are not amendments to the PHS Act. They're just part of the new health care law, which defines states differently, as "each of the 50 states and the District of Columbia." As such, territories are also barred from using the federal health exchange but did have the opportunity to build their own marketplaces….
It's hard to pinpoint when, exactly, they became aware of the potential problems of implementing the insurance reforms without a mandate or subsidies. Either way, they are now very concerned--and there's little hope of a quick solution.
The territorial insurance regulators, on their own and in coordination with the National Association of Insurance Commissioners, have asked the Obama administration for a one-year delay in the requirement that insurers accept all shoppers….
"We urge you...to provide the territories with the flexibility that they need to determine whether and how the market reforms should be applied," an October 16 letter from the NAIC to HHS Secretary Kathleen Sebelius says.
But Health and Human Services has said previously that it doesn't have the regulatory authority to delay a health law provision--only Congress can make that type of an alteration. In a letter this summer, the administration also pointed to the territories' previously eager support for the health-care law which they saw as an about-face. As HHS describes it, territories initially embraced the new regulations only to later reject them.
"HHS, at the request of and with full support from territories, confirmed the Affordable Care Act's market reform provisions that are incorporated into the PHS Act, including the guaranteed availability provision, are applicable to the territories," Center for Consumer Information and Insurance Oversight director Gary Cohen wrote in a July letter to territorial governors.
"However meritorious your request might be," Cohen continues, "HHS is not authorized to choose which provisions...might apply to the territories."
(Territorial officials are quick to point out here that the administration has allowed other delays, to provisions like the employer mandate, when they proved too burdensome to implement. "They keep telling us they can't change the law, but they moved the mandates," says Art Ilagan, Guam's top insurance regulator.)…
read … Territories
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