Urges Focus on Affordability and Appropriate Regulatory Oversight
The New York Health Plan Association (HPA) today welcomed scrutiny of the Department of Financial Services’ (DFS) prior approval process, expected during a Health and Insurance Committee roundtable scheduled for Wednesday (January 6th). HPA said such a review is vital to ensuring the stability of New York’s health care marketplace in order to provide consumers with quality, affordable coverage choices.
“The events of the past couple of months, highlighted by the shutdown of Health Republic, are an indication that New York’s exchange is in a fragile position,” said Paul F. Macielak, HPA president and CEO. “On the eve of the Senate Health and Insurance Committees roundtable to examine these issues, it is important the state not take any actions that make the problem worse and endanger access to coverage.”
With DFS’s unfettered discretion in the premium rate setting process expected to be a key focus of the Senate roundtable, HPA reiterated ongoing concern about the department’s continued imposition of price controls.
“There has been systemic price suppression over the past several years,” noted Macielak, pointing to 2012 when the administration announced creation of the health benefits exchange and issued predictions it would lower small business premiums by more than 20 percent and premiums for individuals by as much as 70 percent. “The suppression is arbitrary, not actuarially based and is directed to achieve a demonstrable level of cuts. These cuts are proving to be unsustainable. As we now know, DFS’s failure to set adequate rates was a significant contributing factor to the undoing of one health plan and seriously jeopardizes the viability of the exchange and the health care market as a whole.”
“Although the state has promised to address the impact of the Health Republic collapse, we believe the industry’s rates for 2016 are not adequate to address the fallout experienced in 2015. Moreover, the rate setting process must be corrected to ensure adequate rates moving forward to protect health plans’ financial solvency and, by extension, consumers’ access to care and choice,” Macielak said.
“A guaranty fund, which hospitals and providers propose to address future possible solvency concerns, is simply another health care tax, on top of the $5 billion in existing health care taxes. Consumers should not shoulder more taxes that ultimately hurt their ability to purchase coverage, and should not be forced to pay for the state’s mistakes,” added Macielak.
HPA looks forward to tomorrow’s Senate roundtable to share its message that affordability be the cornerstone of any health policy discussions in New York, and remains committed to working with lawmakers and regulators to help ensure New Yorkers have access to quality, affordable health care.