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Monthly Archives: June 2017
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Medicaid’s Role in Nursing Home Care
Medicaid: Welfare or Health Insurance?
https://www.axios.com/the-great-medicaid-divide-2445011303.html
Republicans want to roll back the Medicaid expansion, cap federal Medicaid spending increases, and add work requirements, drug testing, time limits, copays and premiums to some state Medicaid programs. But almost no one else wants to do these things. One poll finding goes a long way toward explaining why: Republicans view Medicaid as a form of welfare, and pretty much everyone else views it as a government insurance program.
Why it matters: Welfare remains unpopular in our country; it’s always popular to limit or cut “welfare”. Whether it should be, and what this says about us, is a different question.
What the poll found: As the chart shows, Democrats (73%) and independents (62%) view Medicaid as an insurance program similar to others that help people pay for health care. But a slight majority of Republicans (52%), see it as more similar to welfare programs like food stamps.
Between the lines: One reason Medicaid limits are no slam dunk for Republicans in the Senate may be that not all Republicans view it as welfare: 46% see it as insurance, just as most Democrats and Independents do. Republicans who are more moderate are worried about the practical effects on citizens and states of rolling back the expansion or cutting federal Medicaid spending. One assumes they wouldn’t worry as much unless they viewed Medicaid as valuable health insurance coverage.
Perceptions of Medicaid as welfare don’t seem bothered much by facts, such as, for example, that two thirds of Medicaid spending goes for the low income elderly and disabled who don’t fit the Ronald Reagan era image of the welfare king or queen. But it’s not the majority view in any case. A little less than a third of voters identify as Republicans today, and about half of them see Medicaid as welfare.
It’s this group and their perceptions of the program, and elected officials who share their views, that seem to be driving debate about Medicaid today.
Premiums and Tax Credits under the Affordable Care Act vs. the Senate Better Care Reconciliation Act: Interactive Maps
This map includes premium and tax credit estimates by county for current ACA marketplace enrollees at age 27, 40, or 60 with an annual income of $20,000, $30,000, $40,000, $50,000, $60,000, $75,000, $100,000, or 351% of the federal poverty level (which is just above the cutoff for tax credits under the BCRA). The map includes estimates for premiums, tax credits, and premiums after tax credits for bronze and silver plans in each county in 2020.
Most current Healthcare.gov enrollees have lower incomes:
- About 66% of enrollees have incomes at or below 250% of poverty (approximately $31,250 for a single individual in 2020), with the bulk (44% of all enrollees) having incomes at or below 150% of poverty (approximately $18,750 in 2020).
- About 36% of enrollees are under age 35, 37% are age 35 to 54, and 27% are 55 or older.
Both the ACA and the Better Care Reconciliation Act include tax credits that take into account family income, local cost of insurance, and age. Eligible enrollees are expected to pay a certain percentage of income towards the cost of a benchmark plan, with tax credits covering the remainder of the premium. The premium caps as a percentage of income grow over time.
Under the ACA, people with incomes from 100% to 400% of the poverty level are eligible for tax credits. Premium caps in 2020 will vary from 2.4% of income for a household at the poverty level to 10.2% at 400% of poverty ($50,000), according to Kaiser projections. The caps do not vary by age. The benchmark plan under the ACA is a silver plan with an actuarial value of 70%, meaning enrollees pay for an average of 30% of their health care expenses through cost-sharing.
Under the BCRA, people with incomes up to 350% of the poverty level are eligible for tax credits (including people with incomes below poverty). Under the BCRA, premium caps vary by age and will range in 2020 from 2.4% of income for a household below the poverty level (<$12,500 in 2020), to 17.4% of income for a 60 year old at 350% of poverty ($43,750). The benchmark plan under the Senate bill is a plan with an actuarial value of 58%, meaning enrollees pay for an average of 42% of their health care expenses through cost-sharing.
Note: the map does not include cost-sharing assistance under the ACA that lowers deductibles and copayments for low-income marketplace enrollees. For example, in 2017, people making between 100 – 150% of poverty enrolled in a silver plan on healthcare.gov had an average deductible of $255; those with incomes between 150 – 200% of poverty had an average deductible of $809; and those with incomes between 200 – 250% of poverty had deductibles averaging $2,904. In 2017, the average deductible for a silver plan was $3,609 and $6,105 for a bronze plan.
Our method of estimating premiums before tax credits under the BCRA is based on Congressional Budget Office (CBO) projections for the AHCA, which suggest that the premium for a 40-year-old under the American Health Care Act (AHCA) would be similar to the premium for a 40-year-old under the ACA, before accounting for tax credits and for the same level of coverage. We therefore assume that the premium before tax credits for the lowest cost bronze plan and the second-lowest cost silver plan under the ACA is equal to the premium for a similar plan (with 60% and 70% actuarial values) under the BCRA for a 40-year-old. To arrive at the 60-year-old and 27-year-old premium under the BCRA, we use a 5:1 age curve, since the BCRA would change age rating from 3:1 to 5:1. We assume that states that have set their own age curves with ratios smaller than 3:1 (i.e. New York, Vermont, Massachusetts, and the District of Columbia) would maintain their state-specific age curves under the BCRA. We use the projected premium for the lowest cost bronze plan in each county as an equivalent for the BCRA benchmark plan to calculate tax credits under the BCRA. The BCRA makes it easier for states to waive certain provisions of the law, including the essential benefits insurers are required to cover. Such waivers would tend to lower premiums but increase out-of-pocket costs for health care. Our analysis is based on states not seeking waivers.
Explaining Medicaid’s Starring Role in the U.S. Health Debate
The biggest single change called for by the Republican health-care bill that may be voted on by the U.S. Senate this week is its reduction in federal spending on Medicaid, the program for poor and disabled Americans. The bill is being championed by Majority Leader Mitch McConnell and backed by U.S. President Donald Trump as a way to “repeal and replace” the Affordable Care Act, also known as Obamacare. The Senate bill, like one passed in May by the House of Representatives, would roll back Obamacare’s expansion of Medicaid and make other far-reaching changes to the program as well.
1. Who does Medicaid serve?
It’s the biggest health insurer in the U.S., providing benefits to about one in fourAmericans. It covers almost half of all births, almost two-thirds of people in nursing homes, almost 40 percent of all children and almost a third of adults with disabilities. Total Medicaid spending was $552 billion in the 2015 fiscal year, 17 percent of overall health spending. Along with education, Medicaid is one of the two largest components of spending by state governments, which administer the program and fund it in partnership with the federal government.
2. How did Obamacare change Medicaid?
It expanded Medicaid to cover those who were unable to afford private insurance but didn’t have incomes low enough to qualify for Medicaid before. After a Supreme Court ruling made the expansion optional, 31 states and the District of Columbia used the financial incentives offered under the Obamacare law to add about 12 million people to the Medicaid rolls. To congressional Republicans’ ire, the expansion was funded in part by tax increases on higher-income people. The federal government pays more than 90 percent of the cost of the Medicaid expansion.
3. What would the Republican bills do?
Reverse the expansion of Medicaid, at different paces. The House bill would wind down funding for the expansion starting in 2020. The Senate bill would phase out the expansion’s funding between 2021 and 2024.
4. How else would they change Medicaid?
Currently, the federal government generally reimburses states for a fixed percentage of Medicaid expenditures, regardless of total spending or number of people enrolled. The Republican bills would impose a per-person limit on Medicaid reimbursement that would increase over time at a rate linked to inflation. The Congressional Budget Office said that under the House bill, which uses the rate of medical inflation to set the pace of spending, federal Medicaid spending would decrease by $834 billion between 2017 and 2026. The Senate bill would set a lower growth rate starting in 2025 by using the general inflation rate as a benchmark for much of Medicaid’s spending, rather than the medical inflation rate.
5. What would the impact be?
The Congressional Budget Office estimates that between 2017 and 2026, 15 million fewer people would be covered by Medicaid under the Senate bill, and 14 million fewer under the House bill, than under Obamacare. In both cases, Medicaid would account for about two-thirds of the increase in the number of uninsured projected by the CBO.
6. How else could poor people get coverage?
The House and Senate bills would make them eligible for subsidies for individual insurance policies, meaning people who are dropped from Medicaid could use the subsidies to buy their own coverage. Critics say the bill would make those policies unaffordable to low-income people by increasing deductibles.
7. What’s the debate about the bills like?
8. What’s Trump’s position?
During the 2016 campaign, Trump said that unlike other Republican candidates he would not cut Medicaid, Medicare or Social Security. But he did support the House health-care bill. After McConnell introduced a draft version of his bill, Sean Spicer, the White House spokesman, said that Trump was “very supportive” of the bill but was “committed” to making sure that people currently on Medicaid didn’t lose their coverage.
From Birth To Death, Medicaid Affects The Lives Of Millions
Medicaid pays the costs for about 62 percent of seniors who are living in nursing homes, some of the priciest health care available.
Medicaid is the government health care program for the poor.
That’s the shorthand explanation. But Medicaid is so much more than that — which is why it has become the focal point of the battle in Washington to repeal and replace the Affordable Care Act, also known as Obamacare.
President Barack Obama expanded Medicaid under his signature health care law to cover 11 million more people, bringing the total number of people covered up to 69 million.
Now Republicans want to reverse that expansion, and they want to go much further in cutting back on the number of people covered and federal dollars spent. The legislation they’re contemplating in both the House and Senate shrinks and fundamentally restructures the program.
The report issued by the Congressional Budget Office on Monday estimates that 15 million people would lose coverage through Medicaid by 2026 under the proposed Senate bill.
Here are five key things to know about Medicaid as the debate moves forward.
Medicaid Makes Up Almost 10 Percent Of The Federal Budget
Medicaid is a joint federal/state program under which both costs and regulations are divided. Currently, it’s an open-ended program, where the governments pay for any covered medical costs that beneficiaries need.
Federal spending on Medicaid in 2015 was about $350 billion, almost one-tenth of the $3.7 trillion federal budget. That money is supplemented by the states, so total spending on Medicaid services was $545 billion that year. Those numbers have been increasing as health costs rise and the number of people who are eligible for the program expands.
That’s what makes Medicaid a rich target for Republicans who want to put a lid on its growth. The Senate and House health plans would cap the amount Medicaid will spend per person, and then give states that amount of money to administer the program largely as they please.
Medicaid Pays For Half Of All Births In The United States
Medicaid was established in 1965 as a program to help poor single parents on welfare, along with their children. Two decades after that, the federal government required states to cover poor women who were pregnant for the first time. And in the early 1990s, Congress expanded coverage for pregnant women further to ensure that all pregnant women and mothers of children under age 6 with incomes up to 133 percent of poverty — or $21,599 for a family of two — are covered. According to the Kaiser Family Foundation, about half of all births are now paid for by Medicaid, ranging from 72 percent in New Mexico in 2015 to 27 percent in New Hampshire
Medicaid Pays For Most People In Nursing Homes
Medicaid pays the costs for about 62 percent of seniors who are living in nursing homes. The reason? Many seniors enter retirement with low incomes and few assets. And over time, many middle-income people who saved for retirement spend down their assets on health care.
Inpatient nursing care is some of the priciest health care out there, so even though seniors accounted for only 9 percent of Medicaid beneficiaries in 2014, they used 21 percent of Medicaid dollars, according to the Kaiser Family Foundation.
If You Or Your Loved One Is Disabled, You May Qualify
Medicaid spends almost $200 billion a year caring for people with physical and intellectual disabilities. That’s about one-third of its budget, even though, according to the Center for Budget and Policy Priorities, only about 13 percent of those enrolled in Medicaid are disabled. The services offered to people with disabilities vary by state and can include inpatient care, home-based services including personal care such as bathing and feeding, school-based services for children and job coaching for adults who opt to live independently.
People Who Need Treatment For Opioid Addiction
For people who are addicted to opioids, the expansion of Medicaid has proved to be one of the only paths to treatment. The expansion, in 31 states and the District of Columbia, opened up coverage to adults without children who have incomes up to 138 percent of the federal poverty level. In 2015, the program spent nearly half a billion dollars on Suboxone, a drug used to help those addicted to opioids control their cravings and stop using. Several studies have credited the expansion of Medicaid to better access to medication-assisted treatment, which is the most successful treatment for substance abuse.
Other Adults
About 11 million people got new health coverage through the expansion of Medicaid under the Affordable Care Act. Almost two-thirds of those fall into the category of the working poor, and another 12 percent are looking for work, according to an article published by Health Affairs in March. Many low-wage jobs don’t come with health benefits, and insurance premiums are often too high for people living on the edge of poverty to buy coverage.
Under the House bill and proposed Senate bill, the people who gained coverage under Medicaid expansion would be among the first to lose insurance.
Why the Senate’s health-care plan wouldn’t work in the real world
Drew Altman is president and chief executive of the Henry J. Kaiser Family Foundation.
Monday’s report on the Senate health-care bill from the Congressional Budget Office said that 22 million people would lose coverage under the plan and that coverage in the non-group market would become far stingier than it is today. By Tuesday the bill had been pulled back for revision. The quick sequence was revealing: Senators clearly could use some extra time to figure out how to bridge a giant gap between policy theory and reality.
The CBO report illustrates how policymaking can become divorced from the reality of people’s lives. Here are three big examples of how the Senate health-care bill, as currently configured, may sound one way in theory (and in talking points) but would work out quite another way in practice.
First, the bill phases out the Affordable Care Act’s 90 percent federal match for expanded Medicaid eligibility over four years, reducing it to each state’s regular matching rate. The theory is that this phase-down period would provide time for states to decide whether they want to replace the lost federal funds and continue their Medicaid expansions.
There is no way states can replace funds of this magnitude. If the expansion states try to replace even a significant share of the money, they will be forced to increase taxes or make significant cuts to other parts of their budgets, including for public schools, higher education, environmental protection and corrections. And because the federal match would be phased out incrementally beginning in the first year, states would have every incentive to end or freeze their expansions quickly. The idea that a phaseout would give states time to plan and adjust is driven by a belief that states can operate Medicaid with far less money if they have greater flexibility. In this case, with funding cuts this large, it’s simply wishful thinking.
That leads to reality gap No. 2: the theory that the 14 million people who are covered under the ACA’s Medicaid expansion could buy private coverage with the tax credits offered under the Republican plan, in effect privatizing the Medicaid expansion. This is the biggest reality check in the Senate bill.
Let’s look at a typical adult covered by the Medicaid expansion. He is a 35-year-old man who lives in, say, Minden, Nev., makes $15,000 a year and may even have voted for President Trump. Under the Senate plan, he could buy a policy costing him about $400 per year after using his tax credit, but his plan would come with a deductible of more than $6,000 a year. (The Senate plan’s policies are calibrated to cover just 58 percent of costs.) On a $15,000 income, he cannot afford to get sick with a policy like that. Assuming he has a car to get to work, pays rent, eats food and otherwise has the same basic expenses as any other human being, such a policy would be far from affordable for him. In fact, this is why this hypothetical Trump voter was uninsured before Medicaid was expanded in his state; like millions of his counterparts across the country, he could not afford private coverage.
The Senate plan also trims back the pool of people in the non-group market who will be eligible for tax credits, by reducing the threshold from four to 3½ times the federal poverty line. That leads to reality gap No. 3. Consider a 60-year-old woman in the town of Strong, Maine, making just less than $45,000 a year. She has high blood pressure, takes daily medication and needs regular monitoring because of her previous thyroid cancer. Under the ACA, she is eligible for a premium tax credit of about $7,000 and a comprehensive policy with a premium cost to her of about $4,500 in 2020, when the Senate health-care bill would take effect. Under the Senate plan, she would not be eligible for a tax credit. A similar plan under the Senate bill would cost her more than $15,000, or one-third of her income.
Gaps between the theory and practice of policy are not some Republican creation. Under the ACA, many people have struggled with costs or were forced to change plans and provider networks annually to keep their premiums down. But the current Senate bill takes this divergence to a new level. Private insurance cannot be better than Medicaid if it is unaffordable; states do not have some magic way to cover millions of people with far less money.
The bill may now be altered, and senators will certainly hear from constituents over the holiday recess. They should listen carefully to what they have to say. As it’s written, the Senate health-care plan would substantially widen the gap between policy theory and the real world — making coverage unaffordable for millions more Americans.
Cartoon – Honest Medical Opinion
HENRY KOTULA 