States might be able to use reinsurance programs or health insurance premium subsidies to keep the Patient Protection and Affordable Care Act (PPACA) from leading to big increases in group health insurance premiums, reported LifeHealthPro, an industry journal.

A team at the Health Care Reform Regulatory Alternatives Working Group, an arm of the National Association of Insurance Commissioners (NAIC), has included those ideas in a draft of a PPACA rate increase mitigation discussion paper posted on its section of the NAIC's website.

Health insurance experts in Iowa believe that premiums will increase significantly in 2014 as a result of the federal provisions that will go into effect. Click here to read a related Business Record story.

Regulators from 26 states that are skeptical about the PPACA formed the working group to come up with strategies for addressing their concerns. Iowa is not part of the working group, but the Iowa Insurance Division is monitoring the issues and "we are working to prepare for implementation both inside and outside of the exchange," said Tom Alger, a spokesman for the division.

The working group is dealing, for example, with a provision limiting health plans to charging the oldest enrollees rates only three times as high as the rates they charge young adults, which experts say could lead to big increases in premiums for healthy adults and young adults.

Challenges could include coming up with the cash to pay for the supplemental reinsurance program, the difficulty of structuring a program, and the need to get the program in place very quickly, the drafters said.

Because the federal government will not pay for the supplemental reinsurance programs itself, "states will have to find alternative sources of funding," according to the draft.