For a Healthcare Fix, Tennessee Could Look North (Way, Way North)

Jul 26, 2017

Alaska Governor Bill Walker and First Lady Donna Walker enjoy a sampling of products from the Highway's End Farmer's Market in Delta Junction.

In Alaska, rides to a hospital can cost a small fortune.

“Our uniqueness comes from the fact that 82% of our communities are not connected by roads,” Alaska Governor Bill Walker told NPR in a recent interview. “So we don't take a $300 ambulance ride to the hospital. We take a $50,000 to $150,000 Medevac. Our costs of health care are certainly the highest in the nation.”

But the state’s new Alaska Reinsurance Program is expected to lower premium costs by 20% for Alaska residents who buy insurance through the ACA marketplace, and other states are looking to Alaska as a model for insurance relief.

The Sycamore Institute suggests reinsurance could be an option for Tennessee. The Institute is a Nashville-based, nonpartisan public policy research center.  They recently published an article, Options for Stabilizing Tennessee’s Individual Market.

“A federally-funded, state-run reinsurance or high-risk pool program could help reduce premiums in the state’s Marketplace,” the article says, “by insulating insurers from the costs of covering high-risk individuals. Federal funding for state-run reinsurance and/or high-risk pool programs is available under current law, and the Trump administration has encouraged states to apply for it.”

Brian Straessle, Communications Director for the Institute, joins us to explain how reinsurance works.