August 18, 2017 Edition

CBO Releases Report on Impact of Ending Cost-Sharing Reductions

On Tuesday this week, the Congressional Budget Office (CBO) released a report requested by House Democrats analyzing the potential impact of terminating payments for cost-sharing reductions (CSRs) on the federal budget, health insurance coverage, market stability, and health insurance premiums. Under current law, the Affordable Care Act (ACA) requires insurers to offer plans with reduced deductibles, premiums, and other cost-sharing measures to individuals with lower incomes. Federal payments are provided to insurers to cover the costs of the ACA cost-sharing reduction requirements, which are estimated to be $7 billion this year.

As part of the ongoing discussion around reforming the ACA, President Trump and several members of Congress have suggested terminating CSRs. CSRs are currently being paid on a month-by-month basis and are scheduled to continue through December 2017 but not thereafter. The Trump Administration this week indicated it will provide CSR payments for the month of August despite repeated threats to terminate funds.

According to the CBO analysis, ending CSRs after December 2017 would:

  • Increase Health Insurance Marketplace premiums by approximately 20 percent in 2018 and 25 percent by 2020;
  • Increase the federal deficit by $194 billion over the next decade;
  • Increase the number of uninsured Americans by 1 million in 2018; and
  • Result in approximately 5 percent of Americans living in areas without any insurer willing to sell plans in the Health Insurance Marketplace for the next year.

According to the CBO, estimating the responses of states and insurers of a decision to scrap CSR payments is a difficult and uncertain process.

Contributing to the uncertainty around CSRs is pending litigation taken up by House Republicans in 2014 against the Obama Administration, claiming that CSRs were illegally funded as Congress did not appropriate the funds. A lower level court allowed the case to proceed, and the Obama Administration appealed the ruling at the time. While the Trump Administration has yet to make a decision about whether it will continue the legal fight, 18 state attorneys general, including California’s Xavier Becerra, have been granted permission to intervene in the case by arguing successfully that the Trump Administration would not adequately represent their interests.

As part of its report, the CBO notes that implementing any health care-related changes, such as CSRs, through legislation, as opposed to executive or judicial action, would lend itself to greater certainty in the short term. For example, Congress could alleviate uncertainty around CSRs and pending litigation by appropriating funds to insurers. For now, however, it remains to be seen what next steps Congress and the White House intend to take related to CSRs and the broader ACA.

FDA Announces Comprehensive Tobacco and Nicotine Regulatory Plan

The U.S. Food and Drug Administration (FDA) recently announced a new comprehensive plan to regulate tobacco and nicotine as part of a multi-year roadmap to better protect children and significantly reduce tobacco-related disease and death. At the center of the FDA’s regulatory efforts is a focus on nicotine and the issue of addiction. The agency will work to lower nicotine amounts in cigarettes to non-addictive levels and explore the impact of other tobacco products, such as flavored tobacco items and electronic nicotine delivery systems (ENDS).

The FDA plans to initiate the regulatory plan process through public dialogue and public health input around lowering nicotine levels in cigarettes, approaches to regulating kid-appealing flavored tobacco products, and tobacco cessation safety and efficacy. Policy guidance and new enforcement policies around these same topics are also expected to be released as part of the agency’s plan. FDA’s announcement is available here; the agency also submitted an article describing its nicotine-based framework to the New England Journal of Medicine available here.

Chronic Disease Prevention Leadership Project to Hold September Workshop in Redding

The CCLHO-CHEAC California Chronic Disease Prevention Leadership Project invites CHEAC Members to attend an upcoming workshop entitled “Advancing a Coordinated Policy, Systems, and Environmental Change Approach in Local Health Departments” on Thursday, September 28 from 9:00 am to 3:00 pm in Redding, California. Local health department leaders and NEOP managers from North Coast and Cascade counties who wish to learn more about how broad policy, systems, and environmental (PSE) change can advance health department goals and the role of the NEOP program in promoting a more integrated approach to chronic disease are encouraged to attend.

Senior state leadership from Tobacco Control and NEOP will participate, providing an opportunity to engage in meaningful state/local dialogue on the issues involved in using state NEOP funding for PSE, and in integrating NEOP, tobacco, and other LHD chronic disease programs into a comprehensive approach in local communities. The event flyer is available here. For more information, please contact Lindsey McDermid at