Unemployment claims jumped last week, as the delta variant of the coronavirus sparked rising caseloads around the country and renewed fears about the potential for more restrictions and business closures.
The number of new claims grew to 419,000 from 368,000, the third time in six weeks that they had ticked up, according to data from the Department of Labor.
Economists said the uptick was concerning but cautioned that it was too early to tell whether it was a one week aberration or telegraphed a more concerning turn for the labor market.
“The unexpected bump in claims could be noise in the system, but it’s also not hard to see how the rise of the covid-19 delta variant could add thousands of layoffs to numbers that already are double what they were pre-Covid,” said Robert Frick, corporate economist at Navy Federal Credit Union.
Overall, unemployment numbers have been falling gradually from the peaks at other stages of the pandemic, but they are still well above pre-pandemic averages.
The jobless numbers have provided a jarring catalogue about the economic devastation wrought by the pandemic — spiking to records as the pandemic unfolded in March 2020, and remaining at historic high levels throughout most of 2020.
The coronavirus surge last fall helped precipitate a rise in claims that saw the labor market, as seen in the monthly jobs report, slide backward too.
But until recently, the last few months been marked by strong jobs growth and a sense of optimism as vaccinations picked up, giving economists hope that the country was back on track to recovering the nearly 7 million jobs it is still down from before the pandemic.
Now, the delta variant is driving an alarming increase in covid-19 cases around the country, according to public health officials: the number of new cases increased more than 40 percent in the last week, sending jitters through the stock market, and is raising questions about whether state and local health authorities will reinstitute restrictions to slow the virus’ spread.
Frick said that the report showed the potential for unemployment claims to start trending upward after months of steady declines.
“There’s definitely a correlation, however loose, that the rise in covid does cause a rise in claims,” he said. “My fear is that the rise in the delta variant could cause claims to go back up…Certainly one week doesn’t show that. But I wouldn’t be surprised if we start to see claims rise.”
However, there are also lots of signs that the economy continues to rebound despite rising caseloads.
The more than 2.2 million people that the Transportation Security Administration said it screened at airports on Sunday was the most since late February 2020 — and nearly three times the amount it was on the same day last year.
Restaurant dining has largely rebounded in recent months, at times surpassing the levels from before the pandemic — on Saturday the number of diners was 1 percent higher than the same day in 2019, according to data from Open Table.
Last week, some 12.5 million claims were filed for unemployment insurance overall, according to the most recent numbers — down from 32.9 million filed at the same point last year.
Nevada, Rhode Island and California topped the list of states with the highest number of people on unemployment, the Labor Department said.
Economic concerns in recent months have been more focused on the ways that workers are still held back from filling some of the more than 9 million job openings in the country, than unemployment, with high hopes that school re-openings in the fall will help many parents get back into the labor force.
The Biden administration is quietly engineering a series of expansions to Medicaid that may bolster protections for millions of low-income Americans and bring more people into the program.
Biden’s efforts — which have been largely overshadowed by other economic and health initiatives — represent an abrupt reversal of the Trump administration’s moves to scale back the safety-net program.
The changes could further boost Medicaid enrollment — which the pandemic has already pushed to a record 80.5 million. Some of the expansion is funded by the COVID-19 relief bill that passed in March, including coverage for new mothers.
Others who could also gain coverage under Biden are inmates and undocumented immigrants. At the same time, the administration is opening the door to new Medicaid-funded services such as food and housing that the government insurance plan hasn’t traditionally offered.
“There is a paradigm change underway,” said Jennifer Langer Jacobs, Medicaid director in New Jersey, one of a growing number of states trying to expand home-based Medicaid services to keep enrollees out of nursing homes and other institutions.
“We’ve had discussions at the federal level in the last 90 days that are completely different from where we’ve ever been before,” Langer Jacobs said.
Taken together, the Medicaid moves represent some of the most substantive shifts in federal health policy undertaken by the new administration.
“They are taking very bold action,” said Rutgers University political scientist Frank Thompson, an expert on Medicaid history, noting in particular the administration’s swift reversal of Trump policies. “There really isn’t a precedent.”
The Biden administration seems unlikely to achieve what remains the holy grail for Medicaid advocates: getting 12 holdout states, including Texas and Florida, to expand Medicaid coverage to low-income working-age adults through the Affordable Care Act.
And while some of the recent expansions – including for new mothers — were funded by close to $20 billion in new Medicaid funding in the COVID relief bill Biden signed in March, much of that new money will stop in a few years unless Congress appropriates additional money.
The White House strategy has risks. Medicaid, which swelled after enactment of the 2010 health law, has expanded further during the economic downturn caused by the pandemic, pushing enrollment to a record 80.5 million, including those served by the related Children’s Health Insurance Program. That’s up from 70 million before the COVID crisis began.
The programs now cost taxpayers more than $600 billion a year. And although the federal government will cover most of the cost of the Biden-backed expansions, surging Medicaid spending is a growing burden on state budgets.
The costs of expansion are a frequent target of conservative critics, including Trump officials like Seema Verma, the former administrator of the Centers for Medicare & Medicaid Services, who frequently argued for enrollment restrictions and derided Medicaid as low-quality coverage.
But even less partisan experts warn that Medicaid, which was created to provide medical care to low-income Americans, can’t make up for all the inadequacies in government housing, food and education programs.
“Focusing on the social drivers of health … is critically important in improving the health and well-being of Medicaid beneficiaries. But that doesn’t mean that Medicaid can or should be responsible for paying for all of those services,” said Matt Salo, head of the National Association of Medicaid Directors, noting that the program’s financing “is simply not capable of sustaining those investments.”
Restoring federal support
However, after four years of Trump administration efforts to scale back coverage, Biden and his appointees appear intent on not only restoring federal support for Medicaid, but also boosting the program’s reach.
“I think what we learned during the repeal-and-replace debate is just how much people in this country care about the Medicaid program and how it’s a lifeline to millions,” Biden’s new Medicare and Medicaid administrator, Chiquita Brooks-LaSure, told KHN, calling the program a “backbone to our country.“
The Biden administration has already withdrawn permission the Trump administration had granted Arkansas and New Hampshire to place work requirements on some Medicaid enrollees.
In April, Biden blocked a multibillion-dollar Trump administration initiative to prop up Texas hospitals that care for uninsured patients, a policy that many critics said effectively discouraged Texas from expanding Medicaid coverage through the Affordable Care Act, often called Obamacare. Texas has the highest uninsured rate in the nation.
The moves have drawn criticism from Republicans, some of whom accuse the new administration of trampling states’ rights to run their Medicaid programs as they choose.
“Biden is reasserting a larger federal role and not deferring to states,” said Josh Archambault, a senior fellow at the conservative Foundation for Government Accountability.
But Biden’s early initiatives have been widely hailed by patient advocates, public health experts and state officials in many blue states.
“It’s a breath of fresh air,” said Kim Bimestefer, head of Colorado’s Department of Health Care Policy and Financing.
Chuck Ingoglia, head of the National Council for Mental Wellbeing, said: “To be in an environment where people are talking about expanding health care access has made an enormous difference.”
Mounting evidence shows that expanded Medicaid coverage improves enrollees’ health, as surveys and mortality data in recent years have identified greater health improvements in states that expanded Medicaid through the 2010 health law versus states that did not.
In addition to removing Medicaid restrictions imposed by Trump administration officials, the Biden administration has backed a series of expansions to broaden eligibility and add services enrollees can receive.
Biden supported a provision in the COVID relief bill that gives states the option to extend Medicaid to new mothers for up to a year after they give birth. Many experts say such coverage could help reduce the U.S. maternal mortality rate, which is far higher than rates in other wealthy nations.
Several states, including Illinois and New Jersey, had sought permission from the Trump administration for such expanded coverage, but their requests languished.
The COVID relief bill — which passed without Republican support — also provides additional Medicaid money to states to set up mobile crisis services for people facing mental health or substance use emergencies, further broadening Medicaid’s reach.
And states will get billions more to expand so-called home and community-based services such as help with cooking, bathing and other basic activities that can prevent Medicaid enrollees from having to be admitted to expensive nursing homes or other institutions.
Perhaps the most far-reaching Medicaid expansions being considered by the Biden administration would push the government health plan into covering services not traditionally considered health care, such as housing.
This reflects an emerging consensus among health policy experts that investments in some non-medical services can ultimately save Medicaid money by keeping patients out of the hospital.
In recent years, Medicaid officials in red and blue states — including Arizona, California, Illinois, Maryland and Washington — have begun exploring ways to provide rental assistance to select Medicaid enrollees to prevent medical complications linked to homelessness.
The Trump administration took steps to support similar efforts, clearing Medicare Advantage health plans to offer some enrollees non-medical benefits such as food, housing aid and assistance with utilities.
But state officials across the country said the new administration has signaled more support for both expanding current home-based services and adding new ones.
That has made a big difference, said Kate McEvoy, who directs Connecticut’s Medicaid program. “There was a lot of discussion in the Trump administration,” she said, “but not the capital to do it.”
Other states are looking to the new administration to back efforts to expand Medicaid to inmates with mental health conditions and drug addiction so they can connect more easily to treatment once released.
Kentucky health secretary Eric Friedlander said he is hopeful federal officials will sign off on his state’s initiative.
Still other states, such as California, say they are getting a more receptive audience in Washington for proposals to expand coverage to immigrants who are in the country without authorization, a step public health experts say can help improve community health and slow the spread of communicable diseases.
“Covering all Californians is critical to our mission,” said Jacey Cooper, director of California’s Medicaid program, known as Medi-Cal. “We really feel like the new administration is helping us ensure that everyone has access.”
The Trump administration moved to restrict even authorized immigrants’ access to the health care safety net, including the “public charge” rule that allowed immigration authorities to deny green cards to applicants if they used public programs such as Medicaid.In March, Biden abandoned that rule.
Ruling by a decisive 7-2 margin, in what dissenting Justice Samuel Alito described as the third in “our epic Affordable Care Act trilogy”, the Supreme Court rejected the latest—and likely the last—effort to overturn the 2010 health reform law. Holding that the states and individuals that brought the latest challenge to the law did not have “standing”—the legal right to sue—the high court effectively closed the book on a decade-long series of challenges to the Affordable Care Act (ACA). Those efforts have included two previous Supreme Court cases, numerous promises to “repeal and replace” Obamacare, and the neutering of the law’s “individual mandate” to buy health insurance, which led to this latest case, Texas v. California.
At issue in the case was whether, by zeroing out the penalty for not purchasing insurance, Congress effectively removed the ACA’s status as a taxation measure, which the Court had previously held as central to the constitutionality of the law. In Alito’s dissenting opinion, the full implications of the issue are laid out: in his view, by invalidating the mandate, Congress rendered the entire law unconstitutional, meaning that it should be overturned. But a majority of seven Justices, including Kavanaugh and Barrett (both appointed by President Trump) disagreed, joining Justice Breyer in his opinion thatno harm had been done to the states that brought the suit, and ordering that the case be returned to the lower court for dismissal.
More than ten years after the passage of the ACA, it now (finally) seems as though the law is here to stay. Bolstering its central provisions—subsidized individual insurance coverage, expanded Medicaid benefits, protections for those who purchase insurance—is a centerpiece of the Biden administration’s policy program, featured first in the American Rescue Plan Act, and now in the recovery legislation currently being debated. Republicans, who had long opposed the ACA, barely mentioned it during the last presidential campaign, instead turning their focus to thwarting Democrats’ plans to expand coverage by lowering the Medicare eligibility age or implementing a government-run “public option”.
Given the evenly split makeup of the Senate, however, we continue to believe the greatest hurdle such proposals will face is not Republican opposition, but reluctance on the part of conservative Democrats, like Sen. Joe Manchin (WV), whose votes will be needed for any legislation to pass.
With the Supreme Court calling a third strike against challenges to the ACA, and the new administration eager to advance its other priorities (infrastructure, childcare, jobs), for the first time in over a decade, we might just be in for a period of relative calm on the healthcare policy front.
In what has become something of a Washington tradition, the Supreme Court again upheld the Affordable Care Act on Thursday, in the third major case from Republican challengers to reach the high court.
The margin this time was larger, 7-2, as the High Court appears less and less interested in revisiting the health care law through the judiciary.
Democrats hailed the ruling as a boost to their signature law, and Republicans were left to figure out a path forward on health care amid another defeat.
Here are five takeaways:
This could be the last gasp of repeal efforts
It is impossible to ever fully rule out another lawsuit challenging the health law or another repeal push if Republicans win back Congress.
But after more than 10 years of fighting the Affordable Care Act, GOP efforts at fighting the law are seriously deflated, as many Republicans themselves acknowledge.
“It’s been my public view for some time that the Affordable Care Act is largely baked into the health care system in a way that it’s unlikely to change or be eliminated,” said Sen. Roy Blunt (Mo.), a member of Senate GOP leadership.
Asked if he still wanted to repeal and replace the law, which was the GOP rallying cry for years, Sen. Chuck Grassley (R-Iowa) said instead, “I think I want to make sure it works,” before attacking former President Obama’s promises about the law’s benefits.
Even Sen. Josh Hawley (R-Mo.), who helped bring the lawsuit against the health law as attorney general of Missouri, said Thursday that the Supreme Court had made clear “they’re not going to entertain a constitutional challenge to the ACA.”
Supporters of the law said it is now even more entrenched, despite years of GOP attacks.
“The war appears to be over and the Affordable Care Act has won,” said Stan Dorn, senior fellow at the health care advocacy group Families USA.
Still, not all Republicans are throwing in the towel on at least verbally attacking the law.
“The ruling does not change the fact that Obamacare failed to meet its promises and is hurting hard-working American families,” said House GOP leaders Kevin McCarthy (Calif.), Steve Scalise (La.) and Elise Stefanik (N.Y.).
And there is at least one ACA-related lawsuit still working its way through the lower courts. Kelley v. Becerra challenges provisions of the health law around insurance plans covering preventive care including birth control.
Through the three major Supreme Court cases on ObamaCare, the margin of victory has risen from 5-4 to 6-3 to 7-2.
“There’s a real message there about the Supreme Court’s willingness to tolerate these kinds of lawsuits,” Andy Pincus, a visiting lecturer at Yale Law School, said of the growing margin of victory.
The case was decided on fairly technical grounds. The Court ruled that the challengers did not have standing to sue, given that the penalty for not having health insurance at the center of the case had been reduced to zero, so it was not causing any actual harm that could be the basis for a lawsuit.
Republicans did get some vindication in that Democrats had fiercely attacked Barrett during her confirmation hearings for being a vote to overturn the health law, when in fact she ended up voting to maintain the law.
The ACA is stabilizing
The early years of the Affordable Care Act were marked with the turbulence of a website that failed at launch, premium increases, and major insurers dropping out of the markets given financial losses.
Now, though, the markets are far more stable. For example, 78 percent of ACA enrollees now have the choice of three or more insurers, up from 57 percent in 2017, according to the Kaiser Family Foundation.
Democrats, now in control of the House, Senate and White House, were able to pass earlier this year expansions of the law’s financial assistance to help further bring down premium costs.
The Biden administration announced earlier this month that a record 31 million people were covered under the ACA, including both the private insurance marketplaces and the expansion of Medicaid.
“We are no longer in the Affordable Care Act, ‘How’s it going to go? Is it going to survive?’ mode,” said Frederick Isasi, executive director of Families USA. “We really are in a whole new phase. It really is: ‘How do we improve it?’”
Republicans face questions on their health care message
The Republican health care message for years was summed up with the simple slogan “repeal and replace.”
But now those efforts have failed in Congress, in 2017, and have failed for a third time in the courts.
That leaves uncertainty about what the Republican health care message is. The party has famously struggled to unite around an alternative to the ACA, so there is no consensus alternative for the party to turn to.
The statement from McCarthy, Scalise, and Stefanik calling the ACA “failed,” shows that party leaders are not fully ready to accept the law.
The leaders added that “House Republicans are committed to actually lowering health care costs,” which has been a possible area for the party to focus that is not simply about repealing the ACA.
But any discussion of health care costs is fraught with complications. Republicans, for example, overwhelmingly oppose House Democrats’ legislation to allow the government to negotiate lower drug prices, arguing it would harm innovation from the pharmaceutical industry.
Grassley reached a bipartisan deal on somewhat less sweeping drug pricing legislation with Sen. Ron Wyden (D-Ore.) in 2019, but that bill went too far for many Republicans as well.
Democrats want to go farther, but face an uphill climb
With the ACA further entrenched, and control of the House, Senate and White House, Democrats are looking at ways to build on the health law.
The main health care proposal from the presidential campaign, a government-run “public option” for health insurance, has faded from the conversation and is not expected to be a part of a major legislative package on infrastructure and other priorities Democrats are pushing for this year.
While the health care industry has largely made its peace with the ACA, pushing for a public option or lowering health care costs means taking on a fight with powerful industry groups.
Progressives like Sen. Bernie Sanders (I-Vt.) have instead poured their energy into expanding Medicare benefits to include dental, vision, and hearing coverage, and lowering the eligibility age to 60.
Allowing the government to negotiate lower drug prices also could make it into the package.
“Now, we’re going to try to make it bigger and better — establish, once and for all, affordable health care as a basic right of every American citizen,” said Senate Majority Leader Charles Schumer (N.Y.). “What a day.”
The Supreme Court on Thursday issued an opinion upholding the Affordable Care Act by a 7-2 vote, allowing millions to keep their insurance coverage amid the coronavirus pandemic.
In the decision, the court reversed a lower court ruling finding the individual mandate unconstitutional. However, the court did not get to the key question of whether the individual mandate is severable from the rest of the law. Instead, the court held the plaintiffs do not have standing in the case, or a legal right to bring the suit.
Justice Stephen Breyer wrote the opinion while Justices Samuel Alito and Neil Gorsuch filed dissenting opinions.
Breyer wrote that a court must address a plaintiffs’ injuries. But Breyer found there were no injuries, so he asked: “What is that relief? The plaintiffs did not obtain damages.” Breyer added, “There is no one, and nothing, to enjoin.”
A wide swath of industry cheered Thursday’s news.
The American Medical Association called it a victory for patients, so too did America’s Essential Hospitals, a safety net trade group that called it a win. The American Hospital Association said the more than 30 million of Americans who obtained coverage from the law can “breathe a sigh of relief.”
Millions of Americans gained health insurance coverage as a result of the Affordable Care Act, President Barack Obama’s landmark law passed in 2010 and reshaped virtually every corner of American healthcare. The latest challenge threatened to undo coverage gains under the law that helped drive down the uninsured rate to a record low.
Proponents feared the law was in greater jeopardy following the death of Supreme Court Justice Ruth Bader Ginsburg, part of the court’s liberal wing, which shrunk to just three of a total of nine justices without her.
Those fears now seem to be overblown. Chief Justice John Roberts joined the courts liberals in upholding the law, as did two of President Donald Trump’s Supreme Court picks, Justices Brett Kavanaugh and Amy Coney Barrett.
In a rare move, Trump’s DOJ declined to defend the ACA, when the challenge was brought by a group of red states and two men with marketplace plans. Former California Attorney General Xavier Becerra, now HHS secretary, led a group of blue states to defend the law in federal court.
Recap of the controversial case
The case centers on the individual mandate, the part of the law that compelled Americans to purchase health insurance or pay a fee. The framers of the ACA believed the mandate would help drive healthy people to ensure they weren’t just filled with sick people, risking higher costs and adverse selection for insurers.
Congress effectively killed the mandate in 2017 by setting the penalty to $0.
The plaintiffs’ legal argument was strategic. They directly targeted the linchpin that saved the law in 2012. The Supreme Court largely upheld the ACA in 2012 when it ruled the mandate could be considered a tax and therefore was constitutional. Roberts infuriated conservatives by siding with liberals in that case.
Take that penalty away, by zeroing it out, and the plaintiffs argue the law is no longer constitutional because it can no longer be considered a tax if no money is collected.
The key question before the Supreme Court was whether they could simply pluck the individual mandate from the remainder of the monumental health law,throw the entire law out or find some middle ground.
The plaintiffs have argued that the individual mandate is so intertwined and closely linked to the rest of the law that the entire piece of legislation must fall if the individual mandate is ruled unconstitutional.
Before arriving at the Supreme Court, a lower court ruled in 2019 the mandate was unconstitutional but sent back the key question of whether the mandate could be extracted from the remainder of the law back to the district court. The federal appeals court ruling by a three-judge panel came down along party lines: two Republicans and one Democrat.
A question of standing
Some legal experts have criticized the challenge because the individual plaintiffs, two Texas men, no longer face any financial penalty if they were to forgo coverage. SCOTUS’ ruling agrees with that logic.
The two men joined the case originally brought by a group of red states. Legal experts said it would have been harder for the group of red states to prove an injury than the two men, John Nantz and Neill Hurley.
The word standing was mentioned at least 59 times, according to the court’s transcript of the hearing, outnumbering other key words such as severability, another important legal concept in the case.
In one now-telling exchange from oral arguments, Gorsuch seemed confused over the premise of the challenge to begin with: “I guess I’m a little unclear who exactly they want me to enjoin and what exactly do they want me to enjoin them from doing?”
In the past year, cost was a bigger factor driving Americans to skip recommended healthcare than fear of contracting COVID-19, according to a report released June 1 by Patientco, a revenue cycle management company focusing on patient payment technology.
Patientco surveyed 3,116 patients and 46 healthcare providers, finding 34 percent of female patients and 30 percent of male patients have avoided care in the past year citing concerns about out-of-pocket costs.
Below are three more notable findings from the report:
Healthcare affordability is not an issue that affects only Americans with low incomes, as 85 percent of patients with household incomes greater than $175,000 are less likely to defer care when flexible payment options are offered.
Across all ages, income levels and education levels, most patients said they struggled to understand their medical bills and what they owed. Nearly two-thirds of patients said they did not understand their explanation of benefits, did not know what they should do with the information in their explanation of benefits, or waited too long to obtain their explanation of benefits.
Forty-five percent of patients said they would need financial assistance for medical bills that exceed $500, and 66 percent of patients said the same for medical bills that exceed $1,000.
The U.S. Supreme Court is heading into the last month of its current term with one major healthcare case, the move to invalidate the ACA, yet to be decided, The New York Times reported June 1.
A coalition of Republican-leaning states, led by Texas, have asked the court to strike down the ACA, signed into law in 2010. The states argue that the entire ACA is invalid because, in December 2017, Congress eliminated the law’s tax penalty for failing to purchase health insurance. The states argue that the individual mandate requiring Americans to gain health insurance or pay a penalty is inseparable from the rest of the law and became unconstitutional when the tax penalty was eliminated.
The Supreme Court heard oral arguments in the case in November, and at least five Supreme Court justices indicated support for not striking down the entire ACA.
The court is expected to rule on the matter before its nine-month term ends at the end of June, Reuters reported.