Monthly Archives: March 2017

In This Next Phase Of Health Reform, We Cannot Overlook Long Term Care

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http://healthaffairs.org/blog/2017/03/16/in-this-next-phase-of-health-reform-we-cannot-overlook-long-term-care/

It is becoming apparent that President Trump and the 115th Congress cannot start over with health care reform. Whether you love, begrudgingly support, or fervently hate the Affordable Care Act (ACA), a clean slate is not possible. First, ACA implementation is well underway and has benefited many patients and providers alike. Second, it is unlikely that Republicans in Congress can fully repeal the ACA without a 60 vote, filibuster proof super majority in the Senate. Starting over entirely with health reform is just not feasible.

Trying to address every problem facing the health care system at once is a tall—if not impossible—order. History has taught us that U.S. health reform is an incremental process. With the focus of Congress once again turning to health reform, we have an opportunity to fix the problems with the ACA, and find solutions to health care challenges that the ACA failed to address.

A Growing Need

Long-term care for America’s growing elderly population is a critically important issue for Congress to address in health reform proposals currently taking shape. While the ACA’s insurance expansion focused on providing coverage for the uninsured, the law’s progress on long-term care has been minimal. The ACA tried to address long-term care (LTC) by creating a voluntary system of LTC insurance, but the ill-fated CLASS Act was ultimately determined to be financially unviable and abandoned.

Although policy solutions have been elusive, the need for long-term care is constantly growing. According to current estimates, over two-thirds of elderly Americans will need LTC assistance at some point in their lives. Between 2014 and 2040, the portion of Americans over age 65 is expected to increase from 14.5 to 21.7 percent. At upwards of $60,000 annually, long-term care costs can quickly exhaust personal savings.

As policymakers throughout our history have debated health reform, these efforts have almost entirely centered on questions of medical coverage. They ask which benefits to cover, how much the coverage should cost, and how we can ensure people are not locked out of coverage because of their health status. We must take the same approach to LTC, examining the availability and affordability of services. LTC services include nursing home care and in-home care, as well as what is often referred to as “long-term services and supports” (LTSS). LTSS include assistance with daily activities, such as eating, bathing, dressing, doing laundry, paying bills, and taking medications.

Current Republican health reform proposals appear to do little to push the ball forward on long-term care. As Congress considers proposals to reduce federal spending on Medicaid, they should carefully consider the role of Medicaid in financing LTC.

 

What’s Behind 2.5 Million New Health Jobs?

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http://healthaffairs.org/blog/2017/03/17/whats-behind-2-5-million-new-health-jobs/

December 2007 marked the start of the most severe recession in modern times. For more than two years, the economy shed jobs. By the start of 2010, there were 8.6 million fewer jobs than at the start of the recession. These losses would have been greater had health care employment not continued to grow; jobs outside health care fell by 9.2 million while health care added nearly 600 thousand jobs. It took until November 2014 for non-health jobs to return to their pre-recession level, at which point health jobs had grown by 1.7 million. As of January 2017, there are 2.5 million more health jobs than at the start of the recession, an increase of 19 percent over a 9-year period during which the U.S. population grew by only 7 percent. While health jobs make up about 11 percent of total jobs, they have accounted for 35 percent of the jobs added since the start of the recession.

The remarkable performance of the health sector in continuing to create jobs through the recession and recovery has garnered much attention over the past few years. On the positive side, it has been credited with cushioning the impact of the recession, not only for those fortunate enough to land the new health jobs, but also for those whose non-health jobs were preserved by a health job “multiplier effect,” as health workers spent their income on other goods and services. On the other hand, it has been argued that this health job growth should not be celebrated because it has been wasteful, producing little in the way of improved health outcomes. According to this line of thought, we would have been better off curbing health job growth and investing the saved resources in other areas such as education, infrastructure, food, shelter, and retirement savings. A nice recent summary of these issues can be found here. This post informs continued assessment of the growth in health jobs by looking more closely at the nature of the 2.5 million health jobs added since the start of the recession.

Health Care Job Growth Off to Slowest Start in Two Years; Health Care Prices Rise at Highest Rate in Three Years

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http://altarum.org/about/news-and-events/health-care-job-growth-off-to-slowest-start-in-two-years-health-care-prices-rise-at-highest-rate-in

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The health care sector added 27,000 jobs in February 2017 on the heels of a downwardly revised 12,000 jobs in January, resulting in a two-month average of less than 20,000 new jobs per month – well below the 2015 and 2016 pace of growth.

Health care jobs accounted for only 8% of total job growth during the first two months of 2017, less than half of the 17% share in 2016. As a result, the sector’s share of total jobs dropped to 10.72%, fractionally below the all-time high rate of 10.73% in December 2016.

“In December 2007, just prior to the recession, health jobs accounted for 9.5% of total employment,” said Dr. Charles Roehrig, founding director of Altarum’s Center for Sustainable Health Spending. “Since then, the health sector has added 2.5 million jobs and grown to 10.7% of total employment. As we enter 2017, conditions seem ripe for a more cautious stance in health sector hiring as the leveling off in expanded coverage is accompanied by the possibility of contracted coverage under the proposed replacement for the Affordable Care Act. Thus far, this expected slowdown is supported in the jobs data.”

For more analysis on health sector job growth during the past decade, see Altarum’s Health Affairs Blog post: “What’s Behind 2.5 Million New Health Jobs?”, which is released today.

Health care prices in January 2017 grew 2.1% above the January 2016 level, the fifth consecutive month at this rate. The 12-month moving average, at 1.8% growth, is the highest since May 2013.

Overall, at an annualized rate of $3.47 trillion, national health spending in January 2017 was 5.7% higher than in January 2016. With revised source data, we estimate that national health spending grew 5.2% in 2016, which is above the 4.8% rate projected by the Centers for Medicare and Medicaid Services (CMS).

The complete results are included in Altarum’s Health Sector Economic IndicatorsSM briefs (http://www.altarum.org/healthindicators).

 

How will the House GOP health care bill affect individual market premiums?

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https://www.brookings.edu/blog/up-front/2017/03/16/how-will-the-house-gop-health-care-bill-affect-individual-market-premiums/?utm_campaign=Economic%20Studies&utm_source=hs_email&utm_medium=email&utm_content=46659383

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Earlier this week, the Congressional Budget Office (CBO) published a comprehensive analysis of the American Health Care Act, which is currently being considered by the House of Representatives. While many reactions to the CBO analysis focused on how the AHCA would affect insurance coverage, the bill’s effects on individual market insurance premiums have also received considerable attention.

In its report, CBO estimated that average individual market premiums under the AHCA would be 10 percent lower in 2026 than they would be under current law (before considering subsidies). However, as some observers have noted, this estimated change incorporates changes in the generosity of the plans being offered on the individual market, as well as a shift in the composition of individual market enrollment toward younger individuals, who pay lower premiums. The CBO estimate does not, therefore, answer the question of greatest interest, which is how CBO expects the AHCA to affect average premiums for a given generosity of coverage and a fixed population of individual market enrollees.

However, other information provided in CBO’s analysis can be used to answer this question. Using that information, we estimate that premiums would be around 13 percent higher under the AHCA than they are under current law, holding plan generosity and the individual market age distribution fixed at their current law levels. As illustrated in Figure 1, around three-fifths of the difference between this estimate and the CBO estimate of a 10 percent premium decline reflects the adjustment to hold the individual market age distribution constant. The remainder reflects the adjustment to hold plan generosity constant.

It is important to note that all of the premium changes reported in this analysis reflect premiums before accounting for subsidies available to people purchasing individual market coverage. They therefore do not reflect the effects of the AHCA’s changes to those subsidies. The AHCA would cut spending on such subsidies by around half on average, with lower-income people, older people, and people in high-cost areas seeing particularly large reductions. Thus, the increase in average premiums under the AHCA would be much larger if subsidies were incorporated into the analysis.

The remainder of this analysis presents these results in greater detail and briefly discusses the reasons that the AHCA increases individual market premiums when measured on an apples-to-apples basis.

Universal Health Coverage In California: Is It Even Possible?

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Universal Health Coverage In California: Is It Even Possible?

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As Congress looks at repealing key parts of the Affordable Care Act, California Lt. Gov. Gavin Newsom is suggesting the state take another run at universal health coverage.

Newsom is among several candidates likely to run for governor next year and is proposing a universal health plan as part of his campaign. He said he’s still coming up with the details but is drawing inspiration from the Healthy San Francisco program that he signed into law a decade ago as the city’s mayor. It uses a mix of public dollars and employer contributions to help the uninsured.

Other elected Democrats have recently endorsed the idea of a single-payer system in California. State Sen. Ricardo Lara (D-Bell Gardens) filed legislation last month that would take a first step toward such a system.

Generally speaking, universal health care and single-payer plans can use a variety of means to achieve coverage for all (or nearly all) residents.

These moves come as House Republicans are proposing major cutbacks to Medicaid and to federal subsidies Californians use to purchase health insurance. The Trump administration said it wants to give states more flexibility in running their health care programs, but it’s unclear whether that stance would apply to a deep-blue state like California.

Could universal health care coexist with Republican health plans in Washington? Chad Terhune, a senior correspondent at California Healthline and Kaiser Health News, discussed the question on Wednesday with A Martinez, host of the “Take Two” show on Southern California Public Radio.

What Does The House Health Care Bill Mean For California?

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http://californiahealthline.org/news/what-does-the-house-health-care-bill-mean-for-california/?utm_campaign=CHL%3A%20Daily%20Edition&utm_source=hs_email&utm_medium=email&utm_content=45683230&_hsenc=p2ANqtz-8hQ_w4Pw5zHW51oLQoG_Xu0Ms93jCK5wrfNop7LshVTnlXB2FBzI2QEr6vrjLhLuv48jwJS8sMDL_9vbf-OT9Z2EdBlg&_hsmi=45683230

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As the most populous state with the largest economy in the country, California stands to be dramatically affected by changes to the nation’s health law.

About 1.5 million people buy health insurance through the state’s exchange, Covered California, and most get federal subsidies. About 4 million receive Medicaid (called Medi-Cal here) through the program’s expansion under the Affordable Care Act. Altogether, Medi-Cal covers 14 million people in the state, roughly a third of its population.

The current House bill proposes to significantly change how — and how much — the federal government pays for these programs.

A Congressional Budget Office analysis released Monday found that, if passed, the bill could leave 24 million people uninsured by 2026, while saving the federal government $337 billion. Some Republican leaders contested those estimates, although House Speaker Paul Ryan said he was encouraged by the potential drop in costs.

That likely would translate into millions of people in California losing coverage or seeing their costs rise. Medi-Cal might have to cut programs and eligibility.

On Tuesday, California health care reporter Stephanie O’Neill discussed the potential effects of the bill on California residents with NPR “Morning Edition” host Rachel Martin.

Eliminating Essential Health Benefits Will Shift Financial Risk Back to Consumers

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http://www.commonwealthfund.org/publications/blog/2017/mar/eliminating-essential-health-benefits-financial-risk-consumers

Exhibit 1. The Affordable Care Act’s 10 Essential Health Benefits Categories

  1. Ambulatory patient services
  2. Emergency services
  3. Hospitalization
  4. Maternity and newborn care
  5. Mental health and substance use disorder services, including behavioral health treatment
  6. Prescription drugs
  7. Rehabilitative and habilitative services and devices
  8. Laboratory services
  9. Preventive and wellness services and chronic disease management
  10. Pediatric services, including oral and vision care

Source: The Affordable Care Act, Section 1302(b)(1).

Weeks after Congress started the process to repeal the Affordable Care Act (ACA), questions remain as to whether Republican plans for replacing the law will include protections requiring insurers to cover a minimum package of health benefits. Most replacement proposals have not included such standards. While the recently released House replacement bill retains the ACA’s benefit rules for private health insurance, Secretary Price said the administration and Congress will take additional steps to change the health law. These actions could remove benefit requirements, giving insurers more flexibility to exclude benefits and leave enrollees without coverage for the health care services they need.

Essential Health Benefits Are a Signature Component of the ACA

Prior to the ACA, health insurance in the individual market was often significantly less comprehensive than the coverage available to employees of large companies. The ACA sought to make individual market insurance more robust, and more like typical employer-sponsored coverage, by requiring plans to cover 10 categories of “essential health benefits” (EHBs) (Exhibit 1). Implementing regulations gave states flexibility to choose from among existing health plans in their states in identifying the benefit benchmark. In most states, the EHB benchmark is a small-group plan.