Kemp announces plan to trim private health insurance cost

Gov. Brian Kemp introduces the public to the state's proposal for a federal waiver, which would bring a $300 million reinsurance program to Georgia at Thursday's press conference. Jill Nolin/Georgia Recorder

Gov. Brian Kemp has announced his long-awaited proposal to bring down private health insurance costs – particularly in rural Georgia – but the details of his plan for the state’s insurance program for the poor and disabled will come later.

The Republican governor broadly sketched out his health care strategy at a press conference held Thursday at the Capitol as he approaches the one-year anniversary of a contentious gubernatorial election that centered largely on health care access and coverage. His Democratic opponent at the time, Stacey Abrams, campaigned on fully expanding Medicaid – something Kemp has steadfastly opposed.

“On the campaign trail I promised to lead on health care reform in Georgia,” Kemp said Thursday, pitching a pair of waiver applications – dubbed “Georgia Access” and “Georgia Pathway” – as a campaign promise fulfilled.

Many of the details remain to be seen until Monday morning, when the dual waiver applications will be publicly released. Kemp teased the Monday unveiling, encouraging reporters and others to return next week to learn more about his “plan to enhance access to affordable health insurance to over 400,000 hard-working Georgians.”

Flanked by state leaders and supporters in his ceremonial office, Kemp did not take questions from reporters Thursday.

Thursday’s announcement focused on the somewhat less controversial of the two waiver applications. Attention will shift to the state’s Medicaid program Monday.

The first proposal asks the federal government for three things: Permission to become the first state to bypass healthcare.gov and instead send people directly to insurance companies or brokers, combine government subsidies with employer contributions and create a “reinsurance” program, which has been done in at least a dozen other states.

The proposed reinsurance program alone comes with a hefty price tag: The state will have to chip in $104 million to match the $264 million coming from the federal government, putting the total cost of the program at more than $300 million in the first year. This also means lawmakers will have to sign off on the expense next session, even as they consider cuts elsewhere in the budget.

The state’s proposal would funnel money toward insurance claims between $20,000 and $500,000, with rural communities seeing an 80% coinsurance rate – the highest proposed for a program that divides the state into three categories. That could cut premiums in the state’s most rural communities by about 25%, according to materials provided by the governor’s office.

State Sen. Dean Burke, a Bainbridge Republican, represents a south Georgia district that stands to benefit from the reinsurance program’s focus on reducing premiums in the state’s rural communities.

“Anything that lowers the monthly bills for our constituents is a plus,” Burke said after the press conference. “Just having a choice would be good, too. It’s hard to think that a payer is sharpening the pencil very much if they’re the only one. Why would they have to compete on price?”

Burke also noted that the proposal to let employers who cannot afford to provide comprehensive health care coverage contribute in a smaller way would help mom-and-pop businesses offer a new perk to would-be employees.

Like everyone else, though, Burke said he’s interested in digging into the particulars of the proposal, including the cost.

“The devil’s in the details,” said Burke, who is also a physician and rural hospital administrator.

But others were quick to caution that the proposal appeared to help insurers more than consumers.

“Under this plan, Georgia families and individuals who want comprehensive health coverage may end up paying more, Georgians will have a more difficult time shopping for insurance, and consumers will be at a disadvantage when selecting the plan that’s right for them,” Laura Colbert, executive director of Georgians for a Healthy Future, said in a statement.

“The administration’s plan tips the balance of power in health care toward insurers and away from consumers,” Colbert said. “Each part of this plan helps insurance companies, while consumers shoulder all the risks.”

Laura Harker, senior health policy analyst with the Georgia Budget and Policy Institute, said the reinsurance program could reduce premium costs but warned that allowing tax credits to be used for short-term plans could lure consumers out of more comprehensive plans and drive up costs.

And she cautioned against ditching healthcare.gov, which had an inauspicious beginning when it was first launched. Kemp said the site continues to be confusing and cumbersome. By leaving the federal exchange market, Georgia officials would also attempt to take control of $2.7 billion in existing Affordable Care Act subsidies and change how they’re doled out.

“Georgia’s decision to waive the federal marketplace will further destabilize access to care,” Harker said. “As more Georgians struggle to access health care, state leaders must rework their plans and focus on extending comprehensive health care coverage to as many Georgians as possible.”

The pair of waiver applications would not be officially submitted to federal regulators for consideration until late December. In the meantime, the governor intends to take his plan on a roadshow, with stops across the state starting next week in Savannah.

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