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Plan to Curb Premium Hikes Withdrawn; Thousands Predicted to Lose Health Coverage

Joyce Russell/IPR
Gov. Kim Reynolds and Iowa Insurance Commissioner Doug Omman

A plan that officials had hoped would keep health insurance affordable for thousands of Iowans has been withdrawn, clearing the way for premiums to more than double.    

Governor Reynolds' administration had been urging the federal government to approve its so-called stopgap plan.  

The plan would have restructured benefits for Iowans getting individual insurance under the Affordable Care Act in order to draw in more young healthy people to keep premiums down.  

Congress needs to do its job and fix this law. -Gov. Kim Reynolds

But Insurance Commissioner Doug Ommen says the federal government was asking for more and more adjustments in the plan.

“At the same time we were doing that we discovered the cost continued to climb and increase,” Ommen said.

And Ommen says since enrollment begins November 1, the state can’t wait any longer for the federal  government to say how much Iowa would receive.    

“Late last week we learned from a Department of Treasury staffer that they were several weeks away from calculating how much Iowa would receive in support,” Ommen said.

Governor Reynolds did not blame the Trump administration for the plan’s failure.

“Iowa appreciates President Donald Trump and his administration’s commitment to state flexibility...so states can administer healthcare systems that fit their needs,” Reynolds said.  “But Obamacare was written in an inflexible way, and Iowa could not receive the terms it needed to move forward with the stopgap measure.”

The healthiest will be the first to go. -Insurance Commissioner Doug Ommen

The state will now proceed with just one company, Medica, providing individual insurance under Obamacare.   

Those people applying for individual coverage under the ACA will be automatically enrolled in the plan.  

As many as 20-thousand Iowans are expected to withdraw from the individual market because they can’t afford the premium increases.  

“The healthiest will be the first to go,” Ommen said.

Governor Reynolds said her administration is looking at every option they can to get some type of affordable coverage.    

“Congress needs to do its job and fix this law,” Reynolds said.

Democrats and Republicans weighed in with blame.

“Obamacare is such a failure that state waivers designed to prop it up won't work,” the Republican Party of Iowa said in a statement.

“Republicans have done everything possible to undermine ObamaCare and they have failed to provide a workable, bipartisan alternative to help Iowans who need health care security,” said Senate Democratic Leader Janet Petersen (D-Des Moines).

Follow Joyce Russell on twitter:   @russell_ipr