Tuesday, May 8, 2018 - 08:00 am

BISMARCK, N.D. – Insurance Commissioner Jon Godfread today announced the North Dakota Insurance Department is seeking to work with a consultant in order to perform actuarial and other analysis of state proposals to reform North Dakota’s individual health insurance market. As the Affordable Care Act (ACA) continues to destabilize North Dakota’s individual health insurance market and federal health care reform efforts continue to face significant challenges, the Department is studying various state options available.

“Meaningful health care reform has stalled in Congress. Unfortunately, the fact remains that consumers in North Dakota who seek to purchase their own health insurance are facing increased costs and fewer options. It is now up to the states to be innovative and attempt to find relief for consumers within the rigid structure of the ACA,” Godfread said. “Many of our farmers, ranchers and small business owners simply can no longer afford to purchase health insurance. These are the people who help drive our economy and are now forced to make the decision to forgo health insurance because it is too costly. I believe this study will provide the Department and the Legislature with insight into what the best option for our citizens will be.”

The Department’s goal is to understand the options available and potential impact that implementing such efforts may have on stabilizing the individual health insurance market in North Dakota; namely increasing affordability, competition and consumer choice in both the short and long term as early as health insurance plan year 2020.

The Department is looking for a multi-phased approach to modeling and analyzing reform options and will require that adequate North Dakota-specific modeling be performed to enable it to fully understand the potential impact of several different options. The goal for the analysis is for the Department to understand how each option would affect North Dakota’s individual health insurance marketplace so it can make a determination about which options to propose to the Legislature.

Section 1332 of the ACA permits a state to apply for a State Innovation Waiver to pursue strategies for providing its residents with access to high quality, affordable health insurance while retaining the basic protections of the ACA. State Innovation waivers allow states to implement new ways to provide access to quality health care that is at least as comprehensive and affordable as would be provided absent the waiver, provides coverage to a comparable number of residents of the state as would be provided coverage absent a waiver, and does not increase the federal deficit.

The Department will conduct a Section 1332 waiver analysis based on the following three strategies:

  • The modification of North Dakota’s current high-risk pool, the Comprehensive Health Association of North Dakota (CHAND), to allow a greater number of high risk North Dakotans to obtain their health insurance from CHAND, along with an analysis of the corresponding insurance company assessments necessary for CHAND to successfully operate with an increased high risk membership.
  • The modification of CHAND into an invisible high-risk pool where high risk North Dakotans can obtain their health insurance.
  • The creation of a reinsurance program independent of CHAND. A reinsurance program would limit the amount of risk insurance companies would take on for the high risk North Dakotans they insure.

The Department is also analyzing Idaho’s state-based plan initiative and how a similar state-based plan allowance could operate in North Dakota. The state-based plan initiative would allow insurance carriers to offer plans, outside of the existing ACA exchange, that would be more flexible in how those plans are underwritten and designed. These state based plans would still be required to offer all ACA mandated essential health benefits, be guaranteed issue, but would potentially allow for credits for healthy behavior or other health related factors. These state-based plans would also be a part of the single risk pool for the general marketplace, which could incentivize young and healthy membership into the risk pool and potentially help stabilize the rates.

“The goal of this comprehensive study is to analyze our individual health insurance market from both sides by determining how to successfully attract young and healthy risk into the market and also minimize the amount of risk health insurance companies are exposed to when writing coverage for high risk individuals,” Godfread said. “How do we address North Dakotans who have complex medical issues and find them the necessary coverage they are seeking, while looking for innovative ways to attract and retain North Dakotans who are seeking this coverage for them and their families but cannot afford it under the current constraints of the ACA? In an ideal world, the reforms Congress brought up last year, specifically the Graham-Cassidy legislation, would allow states the increased flexibility we are looking for. However, as it stands now, we are looking to find anything within the existing ACA, which may help us put some downward pressure on health insurance rates in North Dakota.”

The final report and findings of the study are due to be released and shared with the Legislature by the end of September, in time for the 2019 Legislative Session.