Alaska Gets a State Innovation Waiver to Bring Down Premiums
HHS sees state flexibility and innovation as one of the key ways to offer relief to those suffering under the Affordable Care Act.
In March 2017, Secretary Price sent a letter to the governors of all 50 states encouraging them to pursue innovation in healthcare, specifically suggesting that they consider State Innovation Waivers under Section 1332 of the Affordable Care Act. In May, HHS released a State Innovation Waiver checklist, to simplify the process for states considering such a waiver.
In July, HHS approved the first State Innovation Waiver of the Trump Administration, authorizing federal support for Alaska’s reinsurance program.
Reinsurance programs like Alaska’s help cover especially high medical costs, allowing patients to get the care they need without sending insurance prices skyrocketing.
Alaska operated a reinsurance program in 2017 that significantly held down premium increases. For 2018, Alaska will receive federal funding to expand the program, which the state predicts will result in 20 percent lower premiums for Alaskans than they would see otherwise. That means not just lower premiums, but also less federal spending on insurance subsidies.
Even better, actuaries estimate the program could mean an additional 1,460 Alaskans gain coverage because of the waiver. That’s a big deal given that the state’s entire enrollment on the ACA exchange is less than 20,000 people.
Alaska’s State Innovation Waiver is a win-win, which is why HHS hopes to see more waiver applications and more state healthcare innovation in general.