Tag Archives: ACA

The Medicaid Fund: Beware of Gifts

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Press reports have suggested that to get the Affordable Care Act repeal-and-replace effort back on track, Senate leaders are now offering, as part of their Better Care Reconciliation Act (BCRA), a $200 billion fund to help states partially offset the nearly $800 billion dollars in lost federal Medicaid funding they would face over the next decade if BCRA became law. This fund, to be administered by the U.S. Secretary of Health and Human Services (HHS), would apparently be used to help low-income people transition from Medicaid to private insurance.

The offer, if accurate, still amounts to a 75 percent reduction in funding. So the fund does little to address the human and financial consequences of BCRA’s original Medicaid cuts. It’s also unclear how it would work or affect the private insurance market. Furthermore, it’s uncertain whether the Senate parliamentarian would allow a new program. Even if permitted under the strict rules governing the Senate reconciliation process, the program would encounter major legal and operational hurdles in implementation, as well as questions about the lack of public accountability for drawing on the money. It is also worth noting that this type of strategy, in which the HHS secretary is given vast powers over how to allocate funds under the loose rubric of “transition,” may itself raise questions about whether Congress simply has thrown a handful of dollars at the problem, and coupled these dollars with an extraordinary delegation of its constitutional legislative powers to the executive branch.

Today, if a state chooses to insure a Medicaid-eligible population, the federal government will pay a percentage of actual costs. Like insurance generally, these costs can vary by the type of population insured (healthy people versus those who are sick), the amount and intensity of services furnished, and the prices paid. In any year, and in any state, costs vary enormously, a fact driven home by the economic fallout from the opioid epidemic or the Zika virus. The federal Medicaid contribution to state programs ranges from 50 percent to about 75 percent, with higher contributions for low-income adults covered under the ACA’s Medicaid expansion. Equally importantly, there is real accountability in federal Medicaid payments spent to insure people — we know how many people are covered and what services are paid for.

Over the past several weeks, a blizzard of analyses and reports has made clear just how essential Medicaid is to states, their populations, their economies, and their ability to maintain operational health care systems for everyone. Receiving 25 cents on the dollar in lieu of guaranteed Medicaid financing would be little consolation; this is particularly true since presumably, like other special payments to states under the bill, the fund can be expected to be time-limited, after which more action from Congress would be needed to extend its life.

Let’s imagine that this fund becomes law, with details to be hashed out later. A host of questions would arise, all of which would need to be translated into complex and contentious regulations, issued following a lengthy rulemaking process. For example, will normal federal matching rules apply when states draw on this fund, or will states have to put up more funding or perhaps none at all? What types of costs will be recognized as eligible for fund payments? Will all states be able to participate or just those losing expansion funding? Will states be permitted to help only selected Medicaid expansion beneficiaries losing coverage? Although the fund is billed as transitional assistance for beneficiaries, would this include direct payments to providers to allow for continuity of care? Under laws that govern agency policymaking and spending decisions such as when, where, and how to spend $200 billion, these questions and many more would need to move a formal policy development process. The HHS secretary cannot simply dole out unstructured funding that could be used for purposes only tangentially related to transitions.

No vague promises or pennies-on-the-dollar slush fund can take the place of what Medicaid does for people and for states. Nor can it compensate for the consequences of ending the compact on which Medicaid has rested for over 50 years.

Parliamentarian deals setback to GOP repeal bill

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Major portions of the Republican bill to repeal and replace ObamaCare will require 60 votes, according to the Senate parliamentarian, meaning they are unlikely to survive on the floor.

The parliamentarian has advised senators that several parts of the bill could be stripped out, according to a document released Friday by Sen. Bernie Sanders (I-Vt.), ranking member of the Senate Budget Committee. (Read the guidance here.)

The provisions that would likely be removed include policies important to conservatives, such as restrictions on tax credits being used for insurance plans that cover abortion.

Language in the bill defunding Planned Parenthood for a year also violates budget rules, according to the parliamentarian. That guidance is sure to anger anti-abortion groups who backed the bill specifically because of those provisions.

In a statement, Planned Parenthood said it was “obvious” that the defunding provision would be a violation of the reconciliation rules.

“No amount of legislative sleight of hand will change the fact that the primary motivation here is to pursue a social agenda by targeting Planned Parenthood,” the group said.

The parliamentarian has also not yet ruled on a controversial amendment from Sen. Ted Cruz (R-Texas) that would allow insurers to sell plans that do not meet ObamaCare regulations. If that provision were struck, conservative support for the bill would be in doubt.

Republicans are trying to use the budget reconciliation process to pass their healthcare bill with only a simple majority. The provisions deemed impermissible under that process can be stripped if a senator on the floor raises an objection.

Democrats would be virtually certain to deny Republicans the 60 votes they would need to keep portions of the bill intact.

The result is that the arcane rules of the Senate could end up making the bill harder for Senate Majority Leader Mitch McConnell (R-Ky.) to pass.

A spokesman for McConnell was quick to point out that the parliamentarian only provides guidance on the legislation to help inform subsequent drafts. The bill will have to change before it gets to the floor if Republicans want to salvage any of provisions in question.

GOP leaders have said they want to vote on a procedural motion to begin debate on ObamaCare repeal legislation early next week. However, it’s still not clear if they have the votes or which legislation they will be voting on: the replacement bill or repeal-only legislation.

Some conservatives were already questioning Friday why the Senate parliamentarian, Elizabeth MacDonough, would rule against Planned Parenthood defunding, when that provision was allowed under reconciliation in 2015.

A spokesman for Sanders said the guidance has changed because it is now clear that Planned Parenthood would be the only organization affected by the defunding language.

“It passed last time because there was at least a question that other entities could be affected by the language,” the spokesman said. “In the interim, Republicans have not been able to show that any entity other than Planned Parenthood is affected, and the new [Congressional Budget Office] score confirms that.”

In a blow to the insurance industry, the parliamentarian has advised that two key market stabilization provisions in the bill would be against the rules. First, the legislation can’t appropriate the cost-sharing reduction subsidies insurers rely on to keep premiums and deductibles low; it can only repeal them.

Additionally, a “lockout” provision requiring consumers with a break in coverage to wait six months before buying insurance also violates the rules, according to the guidance.

The provision was added to the bill to address concerns that people would only sign up for health insurance when they’re sick, if insurers are still prevented from denying coverage for pre-existing conditions.

The parliamentarian also advised that a specific provision dealing with New York state’s Medicaid program would be a violation of the rules. Senate Minority Leader Charles Schumer (D-N.Y.) seized on that decision.

“The parliamentarian made clear that state-specific provisions” violate the rules, Schumer said. “This will greatly tie the majority leader’s hands as he tries to win over reluctant Republicans with state-specific provisions. We will challenge every one of them.”

State-by-State Estimates of Reductions in Federal Medicaid Funding

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Better Care Reconciliation Act (BCRA): State-by-State Estimates of Reductions in Federal Medicaid Funding – Issue Brief

Medicaid Changes under the BCRA and Possible State Responses

Our analysis examines the changes in the BCRA that would phase out the enhanced matching rate for the ACA Medicaid expansion and limit federal Medicaid spending to a capped amount per enrollee for five eligibility groups (expansion adults, other adults, children, the elderly and people with disabilities). First, under the BCRA, for states that adopted the expansion as of March 1, 2017, the enhanced federal match would phase out from 90% in 2020 to 85% in 2021, 80% in 2022, 75% in 2023 and then to the regular state match rate in 2024 and beyond. This phase out lowers federal Medicaid spending relative to current law, under which federal financing for the expansion population would remain at 90% in 2020 and in subsequent years.

Second, under the BCRA, federal Medicaid spending for most enrollees would be limited to a set amount per enrollee. To establish these limits, states would use data from FY 2014-2016 to develop base year per enrollee spending that would be inflated to 2019 based on the medical component of the consumer price index (CPI-M). Beginning in 2020, federal spending would be limited to the federal share of spending based on per enrollee amounts calculated by inflating the base year spending by CPI-M for children and adults and CPI-M plus one percentage point for the elderly and disabled. Beginning in 2025, all per enrollee limits would be increased by general inflation (CPI-U). Certain spending and populations would be excluded from the per enrollee caps, including enrollees who do not receive the full scope of Medicaid benefits.

States could respond to these changes in federal policy in several ways. We examine changes in federal Medicaid spending under two possible scenarios of state responses: (1) All states, both expansion states and non-expansion states, fill gaps in the loss of federal funding and maintain coverage, including the ACA Medicaid expansion coverage, and (2) states that expanded Medicaid under the ACA fully drop their expansions but maintain spending and coverage for other groups, resulting in declines in both federal and state spending. In the second scenario, we model the loss of federal dollars that the state would have received had it fully maintained its expansion.

Wondering Which Health Bill the Senate Will Vote On? Here’s Your Scorecard

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There hImage result for health bill scorecardave been times when congressional leaders decided to roll the dice and send major legislation to the floor with no certainty of the outcome because the odds of passage were a toss-up. Former House Speaker John Boehner (R-OH) did that more than once in trying to break a deadlock between far-right Freedom Caucus members and more moderate members of his party.

But rarely has a leader from either party asked his members to vote on a controversial bill – one with huge political implications for them — with no advanced warning of what was in the legislation.

Senate Majority Leader Mitch McConnell, a 32-year veteran lawmaker who some consider a “Master of the Senate” because of his wily ability to overcome legislative log-jams, is about to do just that next Tuesday, when he seeks to bring up health care reform legislation that for now remains a mystery to most of his own members, let alone the Democrats and the public.

McConnell spent months in secret backroom negotiations with a select group of Republican senators and Trump administration officials devising an alternative to a House-passed version of the legislation. But when the emerging plan was met with hostility from senators who thought it didn’t go far enough in gutting Obamacare or went too far in cutting Medicaid funding, McConnell engaged in an intense round of deal making to try to buy off opponents. But that didn’t work either.

Now, seemingly baffled by how to proceed, McConnell appears determined to seek closure on his party’s seven-year crusade to repeal and replace the Affordable Care Act. Unable to muster a minimum 50-vote Republican majority around any of a half-dozen competing plans to scrap and replace Obamacare, McConnell is considering a smorgasbord of choices next week to see which – if any—can win approval on the Senate floor in a wide-open showdown.

The options would range from an outright repeal of the ACA while delaying the effective date for two years to give Congress more time to devise a replacement, to simultaneously repealing and replacing Obamacare, to essentially punting on the issue by allowing states to decide for themselves whether to stick with the increasingly popular Obamacare program.

McConnell’s tactic is nearly unprecedented and would mark an extraordinary abdication of leadership responsibility in the drafting of historic health care reform legislation affecting one sixth of the economy, the health and well-being of 20 to 30 million Americans, and the long-term debt.

President Trump vowed throughout the 2016 presidential campaign that he and Republican lawmakers would repeal and replace the national health insurance program practically overnight once he took office. But for months, Trump was largely AWOL from the early talks and lobbying efforts that led to the narrow passage of a plan in the House in early May to the current deadlock in the Senate. Now Trump is making eleventh-hour demands that the Senate stay in town and pass some version of a GOP health bill, leaving McConnell caught between a rock and a hard place.

Steve Bell, a senior official at the Bipartisan Policy Center who spent 32 years on Capitol Hill as a Republican budget and economic adviser, said in an interview Friday, “I have never seen anything like this on an issue of this magnitude.”

Bell, who took part in past congressional deliberations over Social Security reform, deficit reduction deals and nuclear disarmament, added that “In all my years I’ve never seen a major issue that has been as mishandled as this.”

When Senate Majority Whip John Cornyn (R-TX) was asked by reporters whether senators would know in advance precisely what they would be voting on next week, he replied: “That’s a luxury we don’t have.”

There are several possible scenarios for how this political melodrama will play out on Tuesday, provided McConnell can persuade the majority to even proceed with a debate, which is far from a given. Here are the likely choices:

Repeal and Delay

Called the Obamacare Repeal and Reconciliation Act, this version of the bill is perhaps the simplest, if only because it does the least. Over the course of two years, the ORRA would eliminate many elements of the ACA entirely. The mandates would disappear, as would the tax increases, the new regulations regarding what insurance policies must cover, the subsidy payments to keep insurance affordable, and much more. What ORRA would not do is replace the ACA with a different structure meant to prevent the insurance markets from imploding.

The idea behind the ORRA is that, by giving lawmakers two years before the full impact of the law will be felt, there will be ample opportunity to craft a replacement. And because the alternative is so terrible, the argument goes, it follows that lawmakers will do just that.

This is not, to be clear, a sure thing at all. Congressional leaders used the same logic in 2011, putting the prospect of budget sequestration in place to force themselves to craft an alternative. They failed, and the country has been dealing with a policy that even its authors believed was terrible ever since.

CBO reviewed the ORRA earlier this week and determined that it would reduce federal deficits by $473 billion over a decade. But that reduction would come at the cost of 32 million fewer Americans with health care and premium costs for those who remain increasing 100 percent.

Repeal and Replace (I)

The Better Care Reconciliation Act is a sort of half-measure when it comes to doing away with the ACA. It would eliminate much of the law, including the hated individual mandate and many of the related taxes and regulations. However, it would leave much of the law’s structure in place, including subsidies paid to low- and -middle-income Americans. It would also leave many of the requirements related to what insurance policies must cover in place.

Those subsidies, however, would be smaller, and the policies they would buy would generally be worse in terms of coverage. The law changes the benchmark insurance policy from one that covers 70 percent of the expected costs of an individual’s average health care expenses to one that covers about 58 percent. While premiums would come down, the law would also cause deductibles to increase, in some cases by very large amounts. The CBO on Thursday found that the bill would result in Americans living near the poverty line being obligated to spend nearly their entire annual income in deductibles before full coverage kicked in.

CBO found that this version of the GOP repeal effort would save the Treasury $20 billion over a decade. That would come at the cost of about 22 million more Americans without insurance than would have it under current law.

Repeal and Replace (II)

This is an alternative version of the BCRA, restructured to make conservatives who felt the first draft of the bill left too much of the ACA intact. Championed by Texas Sen. Ted Cruz, it contains a provision that would allow insurance companies to offer policies that do not comply with the ACA coverage mandates. This would be conditional on them also offering plans that do comply, at the same time.

The CBO has not scored the BCRA with the Cruz amendment yet, and it is unclear that it will be able to do so before Senate leadership tries to reach an endgame on the health care reform process next week. But while there is no official tallying of the impact, experts have weighed in to warn that the Cruz amendment would have a serious negative effect on people with pre-existing medical conditions.

By allowing young and healthy people to choose bare-bones insurance policies, it will drain the risk pool for more substantial policies, leaving only older and sicker people covered under them. Because this means the insurers will face considerably more risk, they will, in turn, raise premiums and create a vicious cycle that could eventually price many Americans out of the market entirely.

Punt to the States

Some members of the Senate appear to have had their fill of attempting to restructure the health insurance industry in the US and are ready just to hand off the task to the states. Last week, on the same day that McConnell introduced the latest version of the BCRA, South Carolina Sen. Lindsey Graham and Louisiana Sen. Bill Cassidy announced that they would be offering their own alternative bill devolving much of the responsibility for structuring health care markets to the states.

“There’s about $500 billion in money; rather than trying to run health care from Washington, we’re going to block grant it to the states,” Graham said on CNN last week. “And here’s what will happen. If you like Obamacare, you can reimpose the mandates at the state level. You can repair Obamacare if you think it needs to be repaired. You can replace it if you think it needs to be replaced. It will be up to the governors. They’ve got a better handle on this than any bureaucrat in Washington.”

The bill has not been scored by CBO and has received relatively little attention from the media. However, it offers senators two things that many of them would like very much. First is the ability to say that they brought the health care debate to a conclusion that included the demise of the ACA. Second is that it gives the opportunity to claim that they had a role in funneling billions of dollars back into their states’ economies. While it’s unlikely to come up for a vote next week, given the confused state of play in the GOP conference, it would be unwise to rule it out completely.

GOP wrestles with soaring deductibles in healthcare bill

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GOP wrestles with soaring deductibles in healthcare bill

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Senate Republicans have run into another problem in passing their ObamaCare replacement bill: It could increase deductibles by thousands of dollars, potentially alienating moderates who are already skeptical of the bill.

An analysis released Thursday by the nonpartisan Congressional Budget Office (CBO) concluded that a single policyholder purchasing a standard benchmark plan under the GOP bill could face a deductible of $13,000 in 2026.

Under current law, an individual making $56,800 would have a deductible of $5,000, while someone making $26,500 would have an $800 deductible.

A higher deductible is the tradeoff Republicans made when they decided that lowering premiums would be a top priority for their legislation; plans with lower premiums generally have higher deductibles.

“The way we come together, the way we bring together senators all across the ideological spectrum, is focusing on lowering premiums,” Sen. Ted Cruz (R-Texas) said on Fox News on Friday.

“If we’re lowering premiums, that’s a win for everyone.”

Deductibles could become so high under the GOP plan, the CBO said, that many low-income people might decide not to purchase a health insurance plan, even if the premiums were low.

That could be an issue for moderates who have worried about coverage losses, especially for those who gained coverage through ObamaCare’s Medicaid expansion.

The Republican legislation ends the expansion by 2023, and those people will be eligible for tax credits to buy insurance under the GOP plan.

Under the Senate bill, the tax credits for purchasing coverage are tied to ObamaCare’s less generous “bronze” plans that have lower premiums and higher deductibles.

Another factor driving the higher deductibles under the Republican proposal, according to the CBO, is the elimination of ObamaCare insurer payments known as cost sharing reduction subsidies. These payments reimburse insurers for giving discounted deductibles to low-income people.

In an attempt to address the issue, the White House is trying to win over moderates by proposing to allow states to use some Medicaid funding to help low-income people pay for their deductibles.

Higher deductibles for low-income people are a concern, said Sen. Bill Cassidy (R-La.), but he hopes the new White House proposal will fix that.

Senate Republican leaders are also considering offering $200 billion to states that expanded Medicaid, which would be funded by leaving in two of ObamaCare’s taxes on high earners.

That money would come in addition to $132 billion the revised bill already sets aside for a long-term state innovation fund and $45 billion to treat opioid addiction.

“If there’s enough to make it real that someone who is lower-income can get the assistance they need to afford insurance, then that matters,” Cassidy told reporters Thursday.

Sen. Mike Rounds (R-S.D.) said the purpose of leaving those taxes in was to “redistribute” that money to people facing higher costs under the bill.

“What we’re trying to do is allow more local control in some areas so individual states can do some things to help people based on what their needs are,” he said.

“That’s why we kept some of that tax revenue in place. So we can redistribute some of that money to help them because they have no place else to go.”

But some lawmakers question whether the additional funding would make a difference.

While the proposal would add $200 billion in funding, the legislation would cut $756 billion from Medicaid over the next decade, which includes the rollback of the expansion.

“As long as we are fundamentally changing Medicaid and taking some $700 billion out of the program, I do not see myself supporting a bill that does that,” Sen. Susan Collins (R-Maine) told reporters Thursday.

The CBO noted in its score that funding provided to states for stabilization would likely be used to reduce premiums, not deductibles, though the analysis did not include the additional $200 billion.

“The CBO expects that most of these funds would be used to lower premiums. There’s not a lot of money left over for cost-sharing,” said Cynthia Cox, an insurance expert with the Kaiser Family Foundation.

What Trump can do to cripple ObamaCare

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What Trump can do to cripple ObamaCare

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If Congress isn’t able to repeal ObamaCare, it’s likely that the Trump administration will follow through on the president’s vow to let the law fail.

President Trump regularly asserts that ObamaCare is dead or dying, and the administration has already taken steps to undermine the law while congressional Republicans struggle to enact healthcare legislation.

The administration has broad authority over the implementation of ObamaCare, giving officials the power to limit the law’s effectiveness even without congressional involvement.

Here are four ways Trump could cripple the law.

Stop the cost-sharing subsidies.

The biggest thing the Trump administration can do to hurt ObamaCare would be to stop making key subsidy payments to insurers, known as cost-sharing reductions (CSR).

Should the subsidies stop, the insurance markets would likely be thrown into chaos, which could bolster claims from Senate Republicans and the White House that ObamaCare is failing.

Trump has publicly waffled on whether he will continue the payments. At times he’s threatened to withhold them, let the ObamaCare markets collapse and then blame Democrats. At other times, he’s acknowledged the political risks and said the payments would continue.

“We pay hundreds of millions of dollars a month in subsidy that the courts don’t even want us to pay,” Trump said during a lunch with Republican senators Wednesday. “And when those payments stop, it stops immediately. It doesn’t take two years, three years, one year — it stops immediately.”

The White House made the payments for July, but has not made a commitment beyond this month. Insurers have called the payments critical, saying that without them, they would have to massively increase premiums for 2018 or exit the individual market.

Many insurers blamed uncertainty surrounding the payments for proposed double-digit rate increases for 2018.

Stop enforcing the individual mandate.

ObamaCare requires everyone in the country to have health insurance, or pay a penalty. Trump can’t unilaterally abolish the mandate, but he can instruct the IRS to stop enforcing it.

Trump hinted at such a move on the first day he took office, issuing a vaguely worded executive order instructing federal agencies to waive or defer any part of ObamaCare that imposed a “fiscal burden” on states.

But despite the threats, the mandate is still the law and people are still supposed to pay a penalty for lacking coverage.

Insurers are worried that if the Trump administration eases up on the mandate or creates more exemptions to it, it would create a “death spiral” in the ObamaCare markets.

The mandate helps bring in healthy enrollees to balance out the sick ones, with the goal of preventing premiums from spiking. If the healthy people don’t buy insurance, only the sickest will, and premiums will skyrocket.

The mixed signals from the administration about the mandate are spooking insurers. They don’t know what to plan for, and that’s showing in their filings.

“With open enrollment for 2018 only three months away, our members and all Americans need the certainty and security of knowing coverage will be available and affordable for them,” the BlueCross BlueShield Association said in a statement.

Pennsylvania’s five insurers, for example, filed premium increase requests averaging nearly 9 percent. But that increase could be hiked up to 36 percent without the individual mandate and the cost-sharing reduction payments.

Stop advertising and outreach.

The Obama administration used each open enrollment period to heavily promote exchange signups. Administration officials would appear in ads online and on TV.

The Trump administration has taken the opposite approach.

Shortly after Trump took office, the Department of Health and Human Services said it withdrew about $5 million of advertising that was intended to encourage people to sign up for insurance through ObamaCare.

HHS has also shortened the annual open enrollment period from three months to six weeks, and the agency churns out anti-ObamaCare charts, studies and graphics on a regular basis.

HHS Secretary Tom Price has also been producing swaths of ads showcasing “victims” of ObamaCare to promote the law’s repeal.

According to an AP report, the administration recently cancelled contracts with two companies that helped facilitate ObamaCare signups in 18 cities.

Advocates worry that without outreach from the government, Americans who need insurance won’t know they can sign up. Lower signups generally mean higher prices, which has been one of the most consistent Republican critiques of the law.

There’s also no indication that the administration is doing anything to convince insurers to stay in any of the “bare” counties across the country without an ObamaCare plan to buy.

The Centers for Medicare and Medicaid Services under Obama played an active role in enticing insurers back into the markets, but the Trump administration has taken a more hands-off approach.

Use administrative flexibility.

HHS Secretary Tom Price has enormous flexibility within the law to redefine some of its parameters. The powers given to the HHS secretary were meant to help implement ObamaCare, but Price has indicated he’ll use them to dismantle the law.

“Fourteen hundred and forty-two times the ACA said ‘the secretary shall’ or ‘the secretary may,’ ” Price said during his confirmation hearing in March.

Congressional Republicans have urged Price to use every regulatory lever possible.

“There are a lot of things that can be done with regulations, that people don’t see happening on a daily basis,” Sen. John Barrasso (R-Wyo.) told The Hill recently.

For example, Price could change the rules requiring how much insurers would have to cover under the category of essential benefits. While the administration can’t repeal the requirement completely, they can change the definition.

Many congressional Republicans would like to either eliminate the essential health benefit requirement, or at the very least, let states and insurers opt out, so long as they also offer plans that comply with the rules.

If ObamaCare repeal fails in Congress, Republicans will be looking for Price to do the next best thing.

It’s not over

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This was a dramatic week for the Senate’s efforts to repeal and replace the Affordable Care Act.

Revised bills were introduced, each with an updated CBO score. There were last-minute meetings to wrangle votes, and surprise announcements from senators bucking their party’s leaders. There might even be another twist by the time you finish reading this.

The headlines keep changing, but the bottom line is the same. Whatever version of repeal and replace – or repeal without replacement – that the Senate votes on will take away health care coverage for tens of millions of Americans.

The Senate is expected to vote on the “Motion to Proceed” to a repeal bill next week. If the motion passes, senators will begin consideration of a bill. The vote could come as early as Monday or Tuesday.

This debate isn’t over! We need to keep the pressure on. Please contact your senators, especially Republicans, and urge them to vote “no” on the Motion to Proceed.

Hospital and health system leaders have done a tremendous job reaching out to their senators and letting them know how much every community relies on its local hospital. We can’t stop speaking out on behalf of our patients and their families now.

I’ll be in San Diego next week for our annual Leadership Summit, where I hope to see many of you – but rest assured our advocacy team will be fully engaged on the front lines in Washington. At the Summit, look for our advocacy center, where we’ll be monitoring the latest developments and providing platforms for you to send messages to legislators. Coverage for millions of patients is at stake. Let’s see this effort through.

Venrock Partner offers take on Senate health bill debate and how ACA can be fixed (Q&A)

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Venrock Partner offers take on Senate health bill debate and how ACA can be fixed (Q&A)

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Before he joined venture capital firm Venrock and became a partner investing in healthcare startups, Dr. Bob Kocher served as special assistant to President Obama for healthcare and economic policy from 2009 to 2010 and played a role in the development of the Affordable Care Act. Given another rollercoaster week for ACA repeal and replace machinations in the Senate, we thought it would be helpful to check in with Kocher to get his perspective. Kocher responded to questions in a couple of emails. What follows is a lightly edited Q&A.

What do you make of Trump’s comment this week: “We’re not going to own it. I’m not going to own it. I can tell you the Republicans are not going to own it. We’ll let Obamacare fail, and then the Democrats are going to come to us.”

Trump is responsible for the performance and premiums of State Exchanges.  The regulations that Trump enacts governing the individual insurance market, the day-to-day operations of HHS’ insurance exchanges, and efforts to reduce political uncertainty around policies like funding cost-sharing rebates, enforcing the employer and individual mandates, and extending reinsurance all have enormous effects on the premiums.  Also, HHS has a great deal of latitude on how to design the purchasing experience and can make it harder or easier for individuals and brokers trying to help people buy insurance.  How Trump chooses to oversee the Affordable Care Act could easily have a larger impact on premium growth than underlying medical trend.

What aspects of the Affordable Care Act need to be fixed at this point?

The ACA is working well in most places and premiums under the ACA have grown more slowly than prior to the ACA.  Moreover, premiums today are almost exactly what the Congressional Budget Office predicted.  To make the ACA work even better, and to reduce future premiums, five things should be done:

  1. The Trump Administration should enforce the individual and employer mandates
  2. The Trump administration should commit to funding cost sharing rebates (failure to fund these will lead to 10 percent to 15 percent increases in premiums)
  3. Ask Congress to reinstate the risk-corridor funding, that Marco Rubio removed, like we do for Medicare Advantage
  4. Ask Congress to extend and make permanent reinsurance funding like we do for Medicare Advantage
  5. Require plans to bid on large regions or entire states to create larger risk pools and more plan options in less populated counties.

How do you expect the healthcare reform debate to unfold from here?

I think Republicans will find it politically advantageous to move on to other agenda items and work with Democrats to enact these five policies as part of the end-of-year flurry of must-pass government funding bills.   

What aspects of the healthcare reform debate are getting overlooked or missed that you think are important? 

The fundamental problem is that healthcare costs too much. Premiums under the Republican health care plans are forecast to go up even faster than the ACA.  Premiums today are already over $17,000 per year for a family.  That is simply unaffordable.  We need to redesign healthcare to be lower cost.  We know that healthcare can be delivered at lower costs since groups like Kaiser, Geisinger, Group Health, ChenMed, Healthcare Partners, and CareMore have delivered care that is about 30 percent lower cost with great outcomes done this for years.  We need policy makers to argue more about how to create incentives to drive down cost and less about what cost sharing should be for individuals.

Has the healthcare debate on Capitol Hill shown that the shift to value-based care is at risk or can overcome the current uncertainty?

I think the shift towards payment models that reward better outcomes at lower cost is certain. The legislation that drives this change is MACRA and it is not being debated.  MACRA passed Congress with bipartisan support and Secretary Price committed to enact it faithfully during his confirmation hearing.

Does the Senate’s lack of success (so far) with the ACA repeal and replace effort say more about the GOP and the members of this party, the ACA or the divisiveness of the healthcare debate in general?

I think that most Americans think the ACA is working.  Having access to high quality insurance with subsidies to make care more affordable is valued by Americans.  The thought that they would suddenly have to pay both more out of pocket when they go to the doctor with higher deductibles, pay higher annual premiums, and have plans that cover fewer conditions is scary. The rhetoric of “repeal and replace” may have sounded good politically but it is sure unattractive when you consider the reality.

You noted in an editorial you wrote for The Wall Street Journal last year that one thing you got wrong about Obamacare was how the change in the delivery of healthcare would and should happen:

“I believed then that the consolidation of doctors into larger physician groups was inevitable and desirable under the ACA….What I know now, though, is that having every provider in health care “owned” by a single organization is more likely to be a barrier to better care.

Is there anything that can be done to improve this situation through amendments to ACA?

While we anticipated ongoing consolidation of healthcare providers into larger systems, we thought that these systems would also embrace the new payment models the ACA launched.  These new models reward coordination of care that can be made easier through scale and being part of a single organization that can do everything from primary care and hospital care to rehab and hospice.  In reality, these larger systems have discovered that they have the market power to say no to health plans trying to get them to take part in new payment models and to raise prices.  We now need to do more work on creating local market competition and price pressure.

What are the chances that after the repeal effort fails, that a truly bipartisan effort may emerge to deal with areas of the U.S., where the healthcare exchanges are not working well because too few insurers are participating?
I think there can be bipartisan support for solutions to make Exchanges work better and to lower premiums for consumers. Just like Democrats and Republicans have come together to fund reinsurance, risk corridors, and reduce uncertainty for private health plans in Medicare Advantage and Medicare Part D, fortunately, these same solutions will work again for Exchanges. I think we can achieve bipartisan support to bolster the ACA and that Republicans will have the desire to do these things soon.

Small Missouri Town Went For Trump, Now Some Fear Health Care Overhaul

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The closest emergency room is 20 miles east on the highway. That’s why it isn’t unusual for people experiencing heart attacks, blood clots and strokes to show up at Dr. Rodney Yager’s clinic on Main Street in Monroe City, Missouri.

Yager, who grew up in the area, can handle the fast pace of a small-town clinic. What worries him more is how federal health care policies being shaped in Washington, D.C., could affect his patients.

The most recent proposal by Senate Republicans would cut taxes for the wealthy and leave 22 million more U.S. residents uninsured by 2026, compared to current law.

But voter frustrations with the Affordable Care Act’s rollout in communities like Monroe City helped fuel the elections of candidates who promised to dismantle it.

“Honestly, I can see the Republican side of wanting to make budget cuts and try to eliminate waste,” Yager said.”But at the same time, they’re hurting a lot of people.”

This town of almost 2,500 people sprang up about 130 miles northwest of St. Louis, along the railroad in the 1850s. Monroe City, which is just west of Hannibal, was once a Democratic stronghold in northeast Missouri. In the last decades, voters have shifted to favor conservative Republican candidates and their policies. In the most recent presidential election, Monroe, Marion, and Ralls counties voted for Republican Donald Trump over Hillary Clinton, his Democratic rival, by a 3 to 1 margin.

Nevertheless, Democratic U.S. Sen. Claire McCaskill received a warm welcome at the Monroe City Senior Nutrition Center last week, where she held her eighth of 10 town halls during the Senate’s July 4 recess. Her Republican counterpart, Sen. Roy Blunt, held none, a decision that drew protests in the St. Louis area. Members of Blunt’s staff said he met with constituents one-on-one throughout the week.

McCaskill is in a tough spot. Her six-year term will be up at the end of 2018, and she’s running for re-election in an increasingly red state. But in Monroe City, about 60 people listened as she vowed to vote against the latest Republican plan to gut the Affordable Care Act, and reiterated a call for Republican senators to accept amendments proposed by Democrats.

“It’s really a big tax break for wealthy folks, paid for by cutting the Medicaid program,” McCaskill said. “So I’m hoping it doesn’t pass. And then we can sit down together and try and fix what we have, repair what we have.”

It took just three questions before someone asked whether health insurance should be the basis of a health care system at all. Nearly everyone in the room raised their hands when McCaskill asked who would favor extending Medicare coverage to everyone, of any age. The idea of a single-payer system for American health care is a non-starter for conservative lawmakers and think tanks, but has grown in popularity among the general public. A recent Politico poll found that 44 percent of respondents would support a federal health care program for everyone.

“Even though more of you are for ‘Medicare for all,’ I’m worried that we can’t afford it right now,” McCaskill told the crowd. “It’s very expensive.”

Like many small towns in the United States, Monroe City’s population is aging. While voters are more likely to cast their ballot for Republican candidates, they are disproportionately affected by cuts in public spending for health care programs.

These Americans Hated the Health Law. Until the Idea of Repeal Sank In.

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Five years ago, the Affordable Care Act had yet to begin its expansion of health insurance to millions of Americans, but Jeff Brahin was already stewing about it.

“It’s going to cost a fortune,” he said in an interview at the time.

This week, as Republican efforts to repeal the law known as Obamacare appeared all but dead, Mr. Brahin, a 58-year-old lawyer and self-described fiscal hawk, said his feelings had evolved.

“As much as I was against it,” he said, “at this point I’m against the repeal.”

“Now that you’ve insured an additional 20 million people, you can’t just take the insurance away from these people,” he added. “It’s just not the right thing to do.”

As Mr. Brahin goes, so goes the nation.

When President Trump was elected, his party’s long-cherished goal of dismantling the Affordable Care Act seemed all but assured. But eight months later, Republicans seem to have done what the Democrats who passed the law never could: make it popular among a majority of Americans.

Support for the Affordable Care Act has risen since the election — in some polls, sharply — with more people now viewing the law favorably than unfavorably. Voters have besieged their representatives with emotional telephone calls and rallies, urging them not to repeal, one big reason Republicans have had surprising trouble in fulfilling their promise despite controlling both Congress and the White House.

The change in public opinion may not denote newfound love of the Affordable Care Act so much as dread of what might replace it. The nonpartisan Congressional Budget Office estimates that both the House and Senate proposals to replace the law would result in over 20 million more uninsured Americans. The shift in mood also reflects a strong increase in support for Medicaid, the health insurance program for the poor that the law expanded to cover far more people, and which faces the deepest cuts in its 52-year history under the Republican plans.

Most profound, though, is this: After years of Tea Party demands for smaller government, Republicans are now pushing up against a growing consensus that the government should guarantee health insurance. A Pew survey in January found that 60 percent of Americans believe the federal government should be responsible for ensuring that all Americans have health coverage. That was up from 51 percent last year, and the highest in nearly a decade.

The belief held even among many Republicans: 52 percent of those making below $30,000 a year said the federal government has a responsibility to ensure health coverage, a huge jump from 31 percent last year. And 34 percent of Republicans who make between $30,000 and about $75,000 endorsed that view, up from 14 percent last year.

“The idea that you shouldn’t take coverage away really captured a large share of people who weren’t even helped by this bill,” said Robert Blendon, a health policy expert at Harvard who has closely followed public opinion of the Affordable Care Act.

In 2012, when The New York Times talked to Mr. Brahin and others here in Bucks County, Pa., a perennial swing district outside Philadelphia, their attitudes on the law tracked with national polls that showed most Americans viewed it unfavorably.

But now, too, sentiment here reflects the polls — and how they have shifted. Many people still have little understanding of how the law works. But Democrats and independents have rallied around it, and many of those who opposed it now accept the law, unwilling to see millions of Americans stripped of the coverage that it extended to them.