Obamacare insurers just had their best year ever — despite Trump

Obamacare is no longer busting the bank for insurers.

After three years of financial bloodletting under the law — and despite constant repeal threats and efforts by the Trump administration to dismantle it — many of the remaining insurers made money on individual health plans for the first time last year, according to a POLITICO analysis of financial filings for 29 regional Blue Cross Blue Shield plans, often the dominant player in their markets.

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The biggest reason for the improvement is simple: big premium spikes. The Blue plans increased premiums by more than 25 percent on average in 2017, meaning many insurers charged enough to cover their customers’ medical costs for the first time since the Affordable Care Act marketplaces launched in 2014 with robust coverage requirements.

“2017 was the first year we got our head above water in the individual market since the ACA passed,” said Steven Udvarhelyi, CEO of Blue Cross and Blue Shield of Louisiana.

However, one good year won’t ease the trepidation many insurers feel as they start planning for 2019. After knocking out the law’s individual mandate and a subsidy program worth billions of dollars to insurers late last year, the Trump administration is soon expected to finalize rules making it easier to buy cheaper plans exempt from some Obamacare rules.

“I don’t think we’ve turned the corner,” said Kurt Kossen, president of retail markets at Health Care Service Corporation, which operates Blue plans in five states. The insurer lost $2.5 billion on its individual market business during Obamacare’s first three years, he noted. “One year of being able to make a profit out of four certainly is not a stable market,” he said.

The POLITICO analysis found the Blue plans spent an average of 80 percent of premium revenues on medical costs last year. That’s below the 85 percent threshold that’s viewed as a rough benchmark for profitability, and it’s a 12 percentage point improvement over 2016.

“They understand the risks of the market better now than they did at the start of the ACA exchanges,” said Deep Banerjee, an analyst with Standard & Poor’s who has written extensively about the marketplaces.

The gains were particularly notable among some of the biggest insurers. Health Care Service Corporation spent 77.7 percent of premiums on medical claims, an improvement of 18.5 percentage points over the prior year. Similarly, Blue Cross Blue Shield of North Carolina saw its margin improve by just over 10 percentage points.

But not all insurers have figured out how to make money in the troubled markets, which have failed to attract enough young and healthy customers to function effectively in many states. Of the 29 insurers analyzed, eight plans spent more than 90 percent of premium revenues on medical costs last year, meaning they almost certainly lost money in the marketplaces.

The POLITICO analysis provides a snapshot of financial performance in the marketplaces in 2017, not a definitive portrait. Combined, the 29 Blue plans had 4.5 million individual market customers at the end of last year, accounting for about one-fifth of the total market for people who buy their own coverage.

The healthier balance sheets are a welcome development for insurers after three years of major Obamacare losses, estimated at more than $15 billion by McKinsey. That led many national insurers, including UnitedHealth Group and Aetna, to flee the law’s marketplaces, in some cases leaving Blue Cross Blue Shield plans as the only option for customers.

But their improved financial fortunes could also complicate efforts to convince Republican lawmakers to support an Obamacare stabilization package as part of the massive spending bill Congress is trying pass by March 23. Lawmakers are looking to add new funds to help insurers with especially sick customers and restore a subsidy program known as cost-sharing reductions that helps insurers pay medical bills for their low-income customers.

However, a dispute over abortion language is holding up the Obamacare package in Congress. And many conservatives are wary of providing more funding to prop up the marketplaces, deriding it as a bailout for insurance companies.

“The rates can stay low without these payments,” said Rep. Larry Bucshon (R-Ind.), a member of the Energy and Commerce Committee, regarding the cost-sharing reductions that President Donald Trump cut last fall.

Insurers argue that looking at financial performance over a single year is misleading, and they say they’ve been repeatedly blindsided by changes to the law. For instance, because of budgetary restraints Republicans demanded, insurers haven’t received an expected $12 billion from a program meant to help them cover particularly expensive customers. Dozens of insurers are now suing the federal government to recover payments.

“If you don’t want to stabilize the current market, what’s your solution?” Udvarhelyi said. “The fact that we’ve hung in there losing hundreds of millions of dollars is a testament to the fact that we do care, but we need responsible action on the part of policymakers right now.”

Patrick Conway, CEO of Blue Cross and Blue Shield of North Carolina, points out his company would have kept 2018 premiums flat if Trump hadn’t eliminated the cost-sharing subsidy. Instead, the insurer jacked up rates by an average of 13 percent to make up for the lost funding.

“We’re dedicated to having the lowest possible premiums for our customers, and market stabilization would help us have the lowest possible premiums,” Conway said. “I’ve been traveling around the state and people are really worried about the cost.”

As insurers start to crunch the numbers on 2019 premiums, they will have to account for uncertainty over congressional funding and recent steps taken by the Trump administration weakening Obamacare. The elimination of the requirement to purchase insurance, which takes effect in 2019, and the administration’s efforts to make it easier to sell cheaper, skinnier plans that don’t meet Obamacare’s coverage requirements, are likely to further destabilize the markets.

The insurers’ biggest concern is fewer healthy individuals will buy Obamacare plans, either going without coverage, since they’ll no longer face a fine next year, or buying a new cheaper plan that covers far less.

“These things will chip away at the market,” S&P’s Banerjee said. “It’s not going to get meaningfully worse, but it doesn’t get any better.”

Insurers are warning that they’ll again have to jack up rates in 2019 if Congress doesn’t take action to stabilize the markets. A study from California’s marketplace suggests premium spikes around the country are likely to range from 16 to 30 percent next year. That means many Obamacare customers could be facing sticker shock just weeks before heading to the polls.

Polling has consistently shown that Republicans will shoulder most of the blame for future problems in Obamacare, since they’re fully in charge of the federal government. That could spur them to begrudgingly take action to tamp down premium increases, despite their disdain for the health care law.

“I think the people in charge, whether it’s fair or not, will probably [get the blame],” said Rep. Brett Guthrie (R-Ky.), vice chair of the House Energy and Commerce health subcommittee. “Everybody’s prices are going up. We’re going to have to figure out some way to improve it.”

Adam Cancryn and Tucker Doherty contributed to this report.

http://www.politico.com

Pressure builds on Sessions for second special counsel

Attorney General Jeff SessionsJefferson (Jeff) Beauregard SessionsUnder pressure, Trump shifts blame for Russia intrusion Overnight Tech: Judge blocks AT&T request for DOJ communications | Facebook VP apologizes for tweets about Mueller probe | Tech wants Treasury to fight EU tax proposal Overnight Regulation: Trump to take steps to ban bump stocks | Trump eases rules on insurance sold outside of ObamaCare | FCC to officially rescind net neutrality Thursday | Obama EPA chief: Reg rollback won’t stand MORE is under mounting pressure from the right to appoint a second special counsel to investigate conservative allegations of abuse at the Department of Justice and the FBI. 

Up to now, those calls have gone quietly unanswered, with officials pointing to the existence of a Justice Department inspector general investigation that is expected to wrap up sometime this spring.

But Sessions last week revealed that he has tapped a former official outside of the Beltway “with many years in the Department of Justice” to review the need for a special counsel, suggesting the idea is receiving a serious look. 

Powerful GOP lawmakers are urging Sessions to pull the trigger, arguing the IG does not have the prosecutorial authority needed to conduct a full investigation of the FBI’s actions.

Senate Judiciary chairman Charles GrassleyCharles (Chuck) Ernest GrassleyPavlich: The claim Trump let the mentally ill get guns is a lie Congress fails miserably: For Asian-Americans, immigration proposals are personal attacks Grassley, Dems step up battle over judicial nominees MORE (R-Iowa) and Sen. Lindsey GrahamLindsey Olin GrahamCongress punts fight over Dreamers to March Pence tours Rio Grande between US and Mexico GOP looks for Plan B after failure of immigration measures MORE (R-S.C.) on Thursday sent a letter to Sessions and Deputy Attorney General Rod RosensteinRod Jay RosensteinOvernight Cybersecurity: Lawyer charged in Mueller probe pleads guilty to lying | Sessions launches cyber task force | White House tallies economic impact of cyber crime Sessions creates cyber task force to study election interference Dopey Russian ads didn’t swing voters — federal coverups did MORE calling for a special counsel to “gather all the facts.”

“The FBI and the Department of Justice were corrupt, in my view, when it came to handling the email investigation of [Hillary] Clinton. And the entire FISA warrant application process was abused,” Graham told Fox News’ Bret Baier, referring to a surveillance authority conservatives believe was misused during the 2016 campaign to launch the Russia investigation.

Last week, two powerful House GOP chairmen —Judiciary chair Bob GoodlatteRobert (Bob) William GoodlatteProgressive group targets GOP moderates on immigration Florida shooting reopens CDC gun research debate Congress punts fight over Dreamers to March MORE (R-Va.) and Oversight chair Trey GowdyHarold (Trey) Watson GowdyOvernight Energy: Dems ask Pruitt to justify first-class travel | Obama EPA chief says reg rollback won’t stand | Ex-adviser expects Trump to eventually rejoin Paris accord Overnight Regulation: Trump to take steps to ban bump stocks | Trump eases rules on insurance sold outside of ObamaCare | FCC to officially rescind net neutrality Thursday | Obama EPA chief: Reg rollback won’t stand GOP lawmakers: Obama admin ‘hastily’ wrote lead ammunition ban MORE (R-S.C.) — made a similar request, demanding a review of any evidence of “bias” by DOJ or FBI employee as well as whether there was any “extraneous influence” on the surveillance process.

Critics of the GOP push say the allegations of bias and abuse are a transparent effort to undermine special counsel Robert MuellerRobert Swan MuellerSasse: US should applaud choice of Mueller to lead Russia probe MORE’s investigation into the Trump campaign and Russia.

If Sessions’s review does not result in the appointment of a second special counsel, there’s growing speculation that it could be his own head on the chopping block. Trump has repeatedly criticized his attorney general since he recused himself from the Russia investigation last year, and has hammered him for deferring to Inspector General Michael Horowitz.

“Why is A.G. Jeff Sessions asking the Inspector General to investigate potentially massive FISA abuse,” Trump tweeted after Sessions announced Horowitz would be probing the allegations. “Will take forever, has no prosecutorial power and already late with reports on [former FBI Director James] Comey etc. Isn’t the I.G. an Obama guy? Why not use Justice Department lawyers? DISGRACEFUL!”

Sessions late Friday made one move that could help temper conservative criticism as he fired former FBI deputy director Andrew McCabeAndrew George McCabeDopey Russian ads didn’t swing voters — federal coverups did Federal abuses on Obama’s watch represent a growing blight on his legacy In the case of the FISA memos, transparency is national security MORE, long a target on the right, over alleged misconduct. McCabe had been set to retire on Sunday with a full pension.

But critics of the FBI’s handling of the Clinton investigation are likely to see McCabe’s firing — which was made after investigators found he made an unauthorized disclosure to the media and “lacked candor” under oath — as further evidence of the need for a special counsel.

Jay Sekulow, a member of Trump’s personal legal team contesting the Russia investigation, has publicly made the case for Sessions to make such an appointment.

“The special counsel has a deeper ability to talk to witnesses outside of the existing Department of Justice personnel, which is one of the limitations imposed on an inspector general,” Sekulow told Fox News’ Sean Hannity last week.

The crux of the allegations levied by conservatives is that Justice Department and FBI personnel made decisions during the 2016 election that were improperly influenced by bias against then-candidate Trump — in both the investigation into Clinton’s email server and the Russia probe.

GOP lawmakers, citing an investigation conducted by Intelligence Committee chairman Devin NunesDevin Gerald NunesFive key takeaways from the Russian indictments Shepard Smith: New Mueller indictments prove Russia probe is ‘opposite of a hoax’ Schiff: ‘We’re very close to reaching an agreement’ with FBI on countermemo MORE (R-Calif.), say that officials improperly used an unconfirmed dossier of opposition research into Trump to obtain a surveillance warrant for former campaign advisor Carter Page.

Officials did not adequately disclose the provenance of the information when they submitted their application to the clandestine court that approves surveillance requests, Republicans say.

A counter-memo from Intel committee Democrats, also based on the classified warrant application, revealed that officials told the court that the dossier was commissioned by someone who wanted to discredit Trump’s campaign. The information formed only a small part of the application and was corroborated with information from independent sources, the Democratic memo says.

For Republicans, those representations to the court were insufficient. The dossier was paid for in part by the Clinton campaign and the Democratic National Committee (DNC) and GOP members have questioned why it was used at all. 

“Bias and animus can lead to criminality,” Gowdy said last week, as well as “making misrepresentations or failure to make adequate representations to a tribunal.”

“The manner by which information was secured from nongovernmental sources” could also run afoul of the law, he said.

The FBI frequently makes use of intelligence obtained from biased sources. As long as the information is verified and the agenda is disclosed to the court, former officials say, there is nothing improper about using it in a FISA application.

The Goodlatte-Gowdy request centers solely on FISA abuse. Goodlatte in the past has made a separate request for a second special counsel to investigate decision-making in the Clinton probe. 

Republicans have long been incensed that Clinton was not charged and have raised questions about former FBI Director James ComeyJames Brien ComeyDopey Russian ads didn’t swing voters — federal coverups did Assessing Trump’s impeachment odds through a historic lens Drama surrounding Shulkin — what is the future of VA health care? MORE‘s decision to call her conduct “extremely careless” instead of “grossly negligent,” a potentially criminal standard.

Horowitz’s investigation has since expanded to encompass the allegations of surveillance abuse. Its original mandate was to probe decision-making in the Clinton probe, including Comey’s public announcement that the former secretary of State would not face charges.

The Grassley-Graham request also revolves around the bureau’s use of the so-called Steele dossier in its investigation into Trump and Russia.

Under Justice Department regulations, a few preconditions have to be met in order for a special counsel to be appointed. The attorney general must determine that a criminal investigation is warranted and that the Justice Department would have an obvious conflict of interest — and that it would be “in the public interest to appoint an outside special counsel to assume responsibility for the matter.”

Although Grassley and Graham have called for a special counsel to investigate decision-making only up to the May appointment of Mueller, such an appointment could throw a wrench in the current special counsel’s probe, some national security lawyers note.

“Permitting this second Special Counsel, even if it was justified under DOJ regulations (and it is not), would almost certainly disrupt and interfere with Mr. Mueller’s inquiry,” Bradley Moss said in an email to The Hill. 

Even if the new probe were truly limited to surveillance issues, Moss said, it would encompass investigative work done by Justice Department personnel who would undoubtedly have played a role in the work now being done by Mueller’s team.

“This would require Mueller’s lawyers to get involved to protect the integrity of their own investigation. Now, you have two Special Counsels fighting a bureaucratic turf war.”

http://thehill.com

Trump takes victory lap on McCabe firing: ‘A great day for democracy’

President TrumpDonald John TrumpAccuser says Trump should be afraid of the truth Woman behind pro-Trump Facebook page denies being influenced by Russians Shulkin says he has White House approval to root out ‘subversion’ at VA MORE celebrated the firing of former FBI deputy director Andrew McCabeAndrew George McCabeDopey Russian ads didn’t swing voters — federal coverups did Federal abuses on Obama’s watch represent a growing blight on his legacy In the case of the FISA memos, transparency is national security MORE late Friday on Twitter, calling it a “great day for Democracy.”

“Andrew McCabe FIRED, a great day for the hard working men and women of the FBI,” Trump tweeted hours after McCabe’s firing on Friday night.

“Sanctimonious James ComeyJames Brien ComeyDopey Russian ads didn’t swing voters — federal coverups did Assessing Trump’s impeachment odds through a historic lens Drama surrounding Shulkin — what is the future of VA health care? MORE was his boss and made McCabe look like a choirboy. He knew all about the lies and corruption going on at the highest levels of the FBI!” the president continued.

Attorney General Jeff SessionsJefferson (Jeff) Beauregard SessionsUnder pressure, Trump shifts blame for Russia intrusion Overnight Tech: Judge blocks AT&T request for DOJ communications | Facebook VP apologizes for tweets about Mueller probe | Tech wants Treasury to fight EU tax proposal Overnight Regulation: Trump to take steps to ban bump stocks | Trump eases rules on insurance sold outside of ObamaCare | FCC to officially rescind net neutrality Thursday | Obama EPA chief: Reg rollback won’t stand MORE fired McCabe, who was set to retire on Sunday, for not being forthcoming with investigators during an inspector general review.

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McCabe quickly struck back, saying he had been honest with investigators and claiming that he was fired to undermine special counsel Robert MuellerRobert Swan MuellerSasse: US should applaud choice of Mueller to lead Russia probe MORE’s probe into Russian election interference, of which he is a potential witness.

Trump had repeatedly attacked McCabe, claiming that the former FBI official was biased against him and going after his wife’s connection to prominent Democrats. 

“FBI Deputy Director Andrew McCabe is racing the clock to retire with full benefits. 90 days to go?!!!” Trump wrote in a tweet in late December amid news that McCabe would retire in the spring.

McCabe’s wife ran as a Democratic candidate for Virginia state Senate in 2015 and received thousands of dollars in campaign donations from a political group led by Virginia Gov. Terry McAuliffe (D), who is closely tied to the Clintons.

McCabe noted Trump’s attacks in a statement after his firing.

“For the last year and a half, my family and I have been the targets of an unrelenting assault on our reputation and my service to this country. Articles too numerous to count have leveled every sort of false, defamatory and degrading allegations against us. The President’s tweets have amplified and exacerbated it all,” McCabe said.

“He [Trump] called for my firing. He called for me to be stripped of my pension after more than 20 years of service. And all along we have said nothing, never wanting to distract from the mission of the FBI by addressing the lies told and repeated about us. No more,” he added.

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McCabe says Republicans ‘mischaracterized’ testimony to bolster Nunes memo

Former FBI Deputy Director Andrew McCabeAndrew George McCabeDopey Russian ads didn’t swing voters — federal coverups did Federal abuses on Obama’s watch represent a growing blight on his legacy In the case of the FISA memos, transparency is national security MORE on Friday accused Republicans on the House Intelligence Committee of having “mischaracterized” his testimony used to bolster a controversial memo alleging surveillance abuses by FBI and Justice Department officials.

McCabe, who was fired Friday as the No. 2 FBI official, told CNN that information from an opposition research dossier on President TrumpDonald John TrumpAccuser says Trump should be afraid of the truth Woman behind pro-Trump Facebook page denies being influenced by Russians Shulkin says he has White House approval to root out ‘subversion’ at VA MORE‘s ties to Russia did not comprise the “majority” of information for the FBI’s request to obtain a surveillance warrant on former Trump campaign adviser Carter Page.

“We started the investigations without the dossier. We were proceeding with the investigations before we ever received that information,” McCabe told CNN. “Was the dossier material important to the package? Of course, it was. As was every fact included in that package. Was it the majority of what was in the package? Absolutely not.”

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A memo released by Republicans on the House Intelligence Committee in early February said McCabe told the committee that “no surveillance warrant would have been sought” were it not for the information from the dossier compiled by former British spy Christopher Steele. The memo said the dossier information was “essential” in acquiring the warrants to monitor Page.

McCabe told CNN his testimony was “selectively quoted” and “mischaracterized” to bolster GOP claims that the Steele dossier was the key to obtaining a surveillance warrant on Page. 

Republicans have blasted the Steele dossier, calling it unreliable because it was funded by the Democratic National Committee (DNC) and Hillary ClintonHillary Diane Rodham ClintonWoman behind pro-Trump Facebook page denies being influenced by Russians Trump: CNN, MSNBC ‘got scammed’ into covering Russian-organized rally Pennsylvania Democrats set to win big with new district map MORE‘s campaign.

The memo drafted by staff for Intelligence Committee Chairman Devin NunesDevin Gerald NunesFive key takeaways from the Russian indictments Shepard Smith: New Mueller indictments prove Russia probe is ‘opposite of a hoax’ Schiff: ‘We’re very close to reaching an agreement’ with FBI on countermemo MORE (R-Calif.) did state conclusively that the investigation into whether Trump campaign officials had improper contacts with Russia began with information related to George PapadopoulosGeorge Demetrios PapadopoulosGates agrees to testify against Manafort in Mueller probe: report Mueller indictments still miss the mark on Trump-Russia collusion Five key takeaways from the Russian indictments MORE, the Trump campaign foreign policy aide who last year pleaded guilty to lying to FBI investigators about his foreign contacts.

The New York Times previously reported that Papadapoulos bragged to an Australian diplomat that Russians had damaging information on Clinton before the hack of the DNC became publicly known. The Australian government then reportedly tipped off the FBI to what Papadapoulos had said.

McCabe was fired Friday evening by Attorney General Jeff SessionsJefferson (Jeff) Beauregard SessionsUnder pressure, Trump shifts blame for Russia intrusion Overnight Tech: Judge blocks AT&T request for DOJ communications | Facebook VP apologizes for tweets about Mueller probe | Tech wants Treasury to fight EU tax proposal Overnight Regulation: Trump to take steps to ban bump stocks | Trump eases rules on insurance sold outside of ObamaCare | FCC to officially rescind net neutrality Thursday | Obama EPA chief: Reg rollback won’t stand MORE, who said that the FBI’s Office of Professional Responsibility (OPR) and Office of Inspector General (OIG) had found McCabe made an unauthorized disclosure to the news media and “lacked candor – including under oath – on multiple occasions.”

“Pursuant to Department Order 1202, and based on the report of the Inspector General, the findings of the FBI Office of Professional Responsibility, and the recommendation of the Department’s senior career official, I have terminated the employment of Andrew McCabe effective immediately,” Sessions said.

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Trump After Dark: The H.R. Department edition

H.R. McMaster is pictured. | Getty Images

Saul Loeb/AFP/Getty Images

Soon. Not quite yet. Eventually?

The prolonged goodbye of President Donald Trump’s national security adviser H.R. McMaster has a familiar pattern to it: Rumors swirl, potential replacements are floated and then — no immediate action from President Trump. Perhaps even a White House denial.

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Getting “Tillersoned,” as POLITICO’s Eliana Johnson and Matthew Nussbaum report.

“Like now-former secretary of state Rex Tillerson, whom the president dismissed earlier this week, McMaster has never clicked with the president, who prizes personal chemistry and likes to shoot the breeze. And as with the secretary of state, the president decided months ago amid disagreements over his Afghanistan strategy that McMaster wouldn’t be a permanent fixture in his administration.”

But, as the week wound down into the weekend McMaster was still there.

Programming note: Trump After Dark is taking a spring break. We’ll see you back here March 26.

Elsewhere in President Trump’s orbit:

NRA INVESTIGATED: The FEC is looking into allegations that Russians funneled donations to the National Rifle Association.

A NADER PROBLEM: George Nader a witness in Special Counsel Robert Mueller’s investigation pleaded guilty to child pornography charges in 1991.

STORM CHASING: President Donald Trump’s personal lawyer, Michael Cohen, filed to move a lawsuit by porn star Stormy Daniels to federal court a move that could make arbitration easier.

BAD ANALYTICA: Facebook has suspended Cambridge Analytica — a data analysis and communications firm best known for its work for President Donald Trump’s campaign — over concerns that it and other parties improperly obtained and stored users’ personal information.

There you have it. You’re caught up on the Trump administration. Happy Friday.

http://www.politico.com