?tate nf KATHARINE WADE INSURANCE COMMISSIONER PO BOX 816 HARTFORD CT 06142 0816 Elim?urh January 6, 2017 The Honorable Kevrn McCarthy Maj orlty Leader House of Representatwes DC 20515 Dear Ma] orlty Leader McCarthy I apprecrate the opportunlty to share Connect1cut?s perspectwe on next steps our state and our natlon can take together as we contmue to bu1ld upon the successes of the Affordable Care Act (ACA) Smce 2011, Connectrcut?s umnsured rate has gone from 8 percent to a h1storrc low of 3 8 percent Approxrmately 110,000 Connectlcut res1dents have obtamed coverage through our state-sponsored marketplace and the expans1on of Medlcard prov1ded coverage for more than 200,000 Connect1cut reSIdents The ACA has prov1ded all Amerlcans w1th greater access to health 1nsurance and they are usmg thelr coverage for preventlve care and other medrcal treatment Rather than repeal the law, Congress should 1mprove 1t There are three areas that we can focus on to 1mprove gomg forward market stab111ty, the regulatory env1ronment and state and cost contamment Market A key area that we need to focus on 13 the markets for consumers and employers and the Insurers prov1d1ng coverage, part1cularly 1n the 1nd1v1dua1 market Keepmg certam p0pula1 aspects of the law wh1le remov1ng others are less popular but for a stable, funct10n1ng 1nsurance market must be carefully cons1dered We need to contmue to protect consumers w1th health cond1t1ons wh1le 1ncent1v1zmg healthy people to mamtam cont1nu1ty of coverage Th1s rs necessary to create balanced r1sk pools, a key attr1bute of successfully functlomng 1nsurance markets Another area rs Important to market stab111ty 1s encouragmg mnovatron and ?ex1b111ty 1n product des1gn Th1s w111prov1de more chorces for consumers and greater compet1t1on and W111 offer the potent1al to lower premlum rates Greater cho1ce and compet1t1on IS a hallmark of consumer protectlon It drlves compet1t1on and fosters 1nnovat1on Allowmg more 1n plan desrgn W111 encourage all demograph1cs of our natlon from smgle, healthy m1llenn1als to growmg famlhes to older Amerlcans 1n our workforce to choose an 1nsurance plan that best meets thelr 1nd1v1dual and famlly needs In add1t1on, we need to rev1ew ratmg standards and rev1s1t relnsurance and I?lsk adjustment mechan1sms to look for alternatlves that W111 promote market stab111ty and compet1t10n Both Governor Malloy and I have gone on the record w1th the Department of Health and Human Serv1ces about the need to make 1mmed1ate changes to the rISk adjustment methodology to address ?aws 1n the formula wh1ch have had an adverse 1mpact on market compet1t10n Regulatory Envnronment and State State-based 1nsurance regulatton has worked successfully for over 150 years As state regulators our 18 to protect consumers and to ensure the ?nan01a1 solvency of carr1ers so that Insurers can dehver on the1r promlses to customers We rev1ew product ?lmgs and rates as well as the market practlces of 1nsurers As states regulators, we have been on the front hues of ACA 1mplementat1on and we fully understand the Impact that the federal regulatIOns have had on the health 1nsurance markets and consumers 1n our states There IS an opportunlty to ellmmate some regulatory redundanCIes that have added 1ncreased costs for consumers The federal law, 1n some 1nstances, added dupllcat1ve layers of regulatron on top of what states have already been domg Some examples are network adequacy rev1ews, market conduct rev1ews, federal plan eert1?cat1on rev1ews and certam data collectlon The next steps 1n 1mprov1ng the ACA must also recognlze the un1queness of health 1nsurance and health care dellvery as It varles f1 om state-to-state State 1nsurance regulators work 1n space every day and states should be g1ven the flex1b111ty to address the needs of the1r c1tlzens Cost Drlvers Finally, there needs to be a strong focus on addressmg the cost dr1vers of health 1nsurance health care costs Medlcal trend contlnues to 1nflat10n and wage growth Both the cost of care and are growmg Unless these factors are addressed, we W111 not have success 1n makmg health 1nsurance premlums affordable for the broadest group of consumers Connect1cut 1s comm1tted to workmg w1th all stakeholders to dellberately and thoughtfully take a balanced approach toward 1mp1 ov1ng the quallty and dehvery of health care wh1le addressmg the dr1vers of health care costs We need to encourage 1nnovat10n and promote compet1t10n across the health care and 1nsurance sectors to the bene?t of consumers Thank you for the opportumty to allow Connect1cut to share 1n th1s process and I am happy to d1scuss these 1deas further Smcerely, Katharme Wade 0 The Honorable Dannel Malloy Connect1cut congress1onal delegat1on The Honorable Kevm Brady Chalr, House CommIttee on Ways and Means The Honorable V1rg1n1a Foxx Charr, House Comm1ttee on Educatlon and the Workforce The Honorable Greg Walden Chalr, House on Energy and Commerce