Molina Healthcare, a major insurer in the Obamacare exchanges, has now issued a major threat of its own: if Congress doesn't fund the Affordable Care Act cost-sharing reduction subsidies, the company will leave the markets immediately. That would result in about 700,000 people losing their insurance now.
Molina—a Medicaid-based insurer that has thrived in the exchanges—is threatening to throw people off of their health coverage this year and also refuse to participate next year. Roughly 1 million people have a Molina ACA plan. Molina's letter adds a fresh sense of urgency and embodies what the entire health care industry wants: certainty that funding will continue.
In a letter to Paul Ryan, Mitch McConnell, Nancy Pelosi, and Chuck Schumer, Molina CEO Dr. J. Mario Molina writes that the CRSs "have been essential for making coverage affordable for many members. Sixty-five percent of Molina Marketplace members are enrolled in plans with cost sharing subsidies." He goes on:
We entered into these Marketplace contracts with the expectation that the cost sharing reductions would continue to be fully funded. If the CSR funding continues, we intend to maintain are participation in the Marketplace for 2018. […]
If the CSR is not funded, we will have no choice but to send a notice of default informing the government that we are dropping our contracts for their failure to pay premiums and seek to withdraw from the Marketplace immediately. That would result in about 650,000 to 700,000 people losing insurance coverage in 2017, and we would not participate in Marketplace in 2018 resulting in over 1 million Americans losing health insurance coverage.
Molina is the first one to put such a bold statement out there, but it's not the only insurer in this position.
Anthem made a similar warning on Wednesday suggesting that it would consider leaving some of the markets or raising premiums dramatically without assurance the payments would continue.
Sounds like for Democrats, this needs to be resurrected as an issue worth shutting down the government over. The White House's agreement to keep paying the CSRs for at least another month took the issue off of high boil for the immediate continuing resolution. Now it's back, and Pelosi and Schumer need to fight for it.