While Senate Republicans are drafting their healthcare plan behind closed doors, they’ve given reporters a general idea of what might be in it.
The bill is shaping up to have a similar structure as the House’s bill, while more reflecting the principles of centrist Republicans in both chambers.
Senators are still hashing out the specifics, but here’s a look at where they appear to be headed.
Tue, Jun 27 2017 – 6:30pm
Gail Wilensky, Ph.D., Senior Fellow, Project HOPE; Former Administrator Under President George H.W. Bush, Health Care Financing Administration
Andy Slavitt, Senior Advisor, Bipartisan Policy Center; Former Acting Administrator President Barack Obama, Centers for Medicare and Medicaid Services
Mark Zitter, Chair, the Zetema Project—Moderator
Where is health care in the U.S. headed under the Trump administration? What do recent changes mean, and how will they affect consumers? Where should we be heading and why?
Now that the American Health Care Act (AHCA) has passed in the House, health care reform remains a hotter topic than ever. House Speaker Paul Ryan (R-WI) has proposed turning Medicare into a voucher program and funding Medicaid through block grants to states. Congress continues to discuss eliminating the individual mandate and providing more flexibility in terms of which benefits insurers must offer. Conservatives claim these changes would provide greater choice to consumers and more value to the federal budget, while progressives argue that these changes would reduce access to care and worsen health outcomes.
We’ll hear from two former senior officials on the ongoing efforts to repeal or repair the Affordable Care Act (ACA). Andy Slavitt recently stepped down as acting administrator for the Center for Medicare and Medicaid Services under President Barack Obama. Gail Wilensky held the same post under President George H.W. Bush. Both experts continue to speak out from differing perspectives on Medicare and Medicaid as well as broader reform issues. Join us for a spirited discussion on the problems and prospects of U.S. health care.
Location: 555 Post St., San Francisco
Time: 5:30 p.m. check-in, 6:30 p.m. program
Notes: In association with the Zetema Project
As the ad hoc committee of 13 Republican senators rethinks the increasingly unpopular American Health Care Act, Congress and the administration face a more pressing question. Will they stabilize the individual insurance market for 2018?
Preliminary rate filings for next year suggest that some states are entering the first phases of the much-dreaded death spiral, where rising rates and declining enrollments feed on each other to climax in a collapsed market. Where last year it was mostly rural areas that suffered from a dearth of carriers offering exchange plans, major urban areas like Kansas City and Knoxville, Tenn., are now among the regions reporting no insurers interested in offering coverage.
Meanwhile, carriers are requesting double-digit rate hikes in many areas of the country. Increase requests as high as 50% have been reported.
Republicans blame the Affordable Care Act. But, in fact, blame rests squarely with the Trump administration and the Republican-controlled Congress, who’ve created tremendous uncertainty around the policies that make the ACA’s individual market work.
The biggest single problem is Congress’ failure to appropriate the $7 billion owed insurers for underwriting cost-sharing reductions for low-income plan purchasers. That affects about 7 million of the 13 million people who signed up for individual plans.
Last year, Congress also put a one-year hold on the surcharge on health insurance premiums that supports ACA subsidies. Without further action, the tax, which was slated to raise about $100 billion over the next decade, will go into effect in 2018.
From a budgetary perspective, the move is a wash. The increased tax collection will be offset by the increased subsidies given low-income people who buy plans. People who are unsubsidized—those most likely to be bitter opponents of Obamacare—will be hit dollar-for-dollar with the rate hike.
President Donald Trump also contributed to uncertainty over next year’s enrollment period. First, he halted media promotion of the 2017 open enrollment. Then, in February, he issued an executive order waiving the individual mandate, which is key to getting millions of younger, relatively healthy people into the individual market pool.
While Politico reported last month that the Internal Revenue Service didn’t carry out the president’s order this year, the atmospherics around these pronouncements will ensure that fewer people sign up for individual plans in 2018. Insurers are assuming they will be covering an older, sicker population, a surefire path to higher rates.
Last week, Bradley Wilson, CEO of Blue Cross and Blue Shield of North Carolina, dissected how these compounding uncertainties contributed to its request for a 22.9% rate hike. About half the increase came from the missing cost-sharing reduction subsidies; about a third from an expected increase in medical losses, driven by rising costs and a sicker pool; and the rest from the expected tax.
This Republican Congress and the administration could quickly solve these problems without sacrificing their political principles. The administration could signal it will enforce the mandate since it is still the law. Congress could appropriate the money for the cost-reduction subsidies. This would preserve the House’s lower court victory in its suit challenging the Obama administration’s lacking an appropriation.
And, in a nod to their goal of protecting people with pre-existing medical conditions, Congress could create a reinsurance program to cover the extraordinary expenses of high-cost patients in the individual market. Unlike state-run high-risk pools, which have never worked, a federally funded reinsurance program would preserve everyone’s access to health insurance in the individual market at affordable rates.
It’s up to Congress now. Insurers face a June 21 deadline for notifying HHS about participation in the exchanges, and final rates are due from states by Aug. 16; there’s not much time to act. We’ll soon find out if Trump and this Congress intend to deny millions of people access to affordable health insurance next year.
The ‘Kimmel test’ could be a good health care yardstick for the GOP
Should the “Kimmel test” help shape the health care bill that the US Senate is now working on behind closed doors? Republican senators could easily use it to vet the bill while staying true to their conservative roots.
Last month, talk show host and comedian Jimmy Kimmel shared with his audience a story about his son, Billy, who had been born a few days earlier with a heart defect called the tetralogy of Fallot and needed open heart surgery at three days old.
“If your baby is going to die, and it doesn’t have to, it shouldn’t matter how much money you make,” pleaded Kimmel in an impassioned take on health insurance that has been viewed by millions.
Not long afterward, Republican Senator Bill Cassidy, a physician who represents Louisiana, said that any Republican health care legislation would need to pass the “Jimmy Kimmel test.” Morally and politically, Cassidy is right.
Every day in my work in a pediatric emergency department, I see firsthand that the Affordable Care Act, the law that the Republican House and Senate are determined to replace, saves lives. Before the ACA, children born with pre-existing conditions were often uninsurable, their families left to struggle with an unmanageable economic burden.
Kimmel thinks the solution is easy: “Don’t give a huge tax cut to millionaires like me and instead leave it [the ACA] how it is.” But the solution is far from easy.
As a physician, a conservative Republican, and a health insurance scholar, I believe that government intrusion into private insurance has had serious consequences. Families across America are paying thousands of dollars a year more in higher health insurance premiums. Insurers, which have been losing money, have started abandoning entire markets. The House of Representatives passed the American Health Care Act in early May, believing it had to do so to stabilize markets and reduce premiums. But the Congressional Budget Office finally reported that the AHCA strips away most protections for pre-existing conditions and pushes an estimated 23 million more Americans into being uninsured.
Can we Republicans pass the Kimmel test, improving on the AHCA while still ensuring the sustainability of American health care? Senate Republicans have expressed skepticism, but I believe we can. The key is to stay true to our roots by adhering to four conservative principles.
First, private markets must remain free. Healthy people will need to help pay for sick people — that’s how health insurance works — but they must be allowed to choose their own insurance. The ACA coerced the healthy into paying above-market rates for insurance, and so it prohibited the lower-premium catastrophic plans that make sense for most families.
Second, the poor should never pay for government benefits to the wealthy. The main way the ACA tries to help families with pre-existing conditions is by regulating insurance premiums, but that means its benefits are indiscriminate. The young and healthy, many of whom are struggling economically, pay more. The elderly, many of whom need help but some of whom are wealthy, pay less. We should use America’s progressive tax system, where the wealthy pay more in taxes, to implement a means-tested health insurance system that specifically helps the needy. Republicans don’t love taxes, but a hidden tax is worse than a visible one, and it is utter anathema that the ACA moves even a single dollar from the poor to the rich.
Third, redistribution must be transparent. The ACA mainly forces higher costs onto private insurance plans, which invisibly pass those costs to healthy consumers. Democrats may prefer this hidden tax politically, but to abide by conservative principles, a subsidy must come with a budget that can be seen, understood, and voted on.
Fourth, health insurance subsidies must be structured to reduce expenditures over time. Just as welfare should be a bridge to independence for individuals, subsidies should be a bridge to sustainability for the health care industry.
The ACA introduced some promising cost-reductions, like financial responsibility provisions for hospitals and limits on luxury plan tax deductions. The Senate needs to continue these efforts. Subsidized care must be adequate and compassionate, but it should insist on using generic drugs (when available) rather than brand-name ones, and it should not cover newly constructed hospitals or low-value services. Medicine must de-intensify, helping patients receive care at home instead of in hospitals when appropriate and using social workers to meet social needs. We also need to help subsidized patients take more responsibility for their health — showing up for appointments, taking prescribed medications, and, if needed, quitting smoking and receiving treatment for addiction.
In my view, the best way to accomplish these four goals would be through either a federally funded expansion of Medicaid or a federally run high-risk pool, which would offer families a means-tested option to buy in once medical bills reach a certain point. Such a plan would intentionally have high deductibles and copays, but it would offer extra assistance to needy families. The private insurance market would be free to compete on price and quality, innovating new ways to deliver value.
I am not writing to advocate for any specific plan. Instead, I offer conservative principles as a yardstick: Does the program provide compassionate, adequate coverage to the sick? Is it transparent, fair, and sustainable? Are the healthy still free to choose their own insurance?
Republicans can craft sensible, conservative subsidies to protect our most vulnerable citizens while also preventing hidden taxes and blank checks. Kimmel is right: No parents should have to choose between bankruptcy and saving their child’s life. Nor does our nation have to choose between fiscal irresponsibility and compassion for our most vulnerable.
Senate Republicans are moving into high gear on their effort to repeal the Affordable Care Act, making it likely that within the next few weeks they’ll either pass something and keep the process hurtling forward, or abandon it altogether.
Judging from what they’re saying, it looks like the latter is the most likely scenario: They fail to pass their version of repeal, then say, “Well, we tried,” shake that albatross off their shoulders, and move on to the rest of their agenda. It would leave many in the party infuriated, but it might be the best of the bad options available to them.
The latest developments suggest Senate Majority Leader Mitch McConnell (R-Ky.) may be hoping to rip the Band-Aid off as quickly as possible and get this whole thing behind them.
After spending a month deliberating over a response to the House’s passage of a bill to repeal the law, Senate Majority Leader Mitch McConnell (R-Ky.) is accelerating the party’s stagnant work as a jam-packed fall agenda confronts congressional leaders and President Donald Trump. Republican leaders want resolution to the tumultuous Obamacare repeal debate by the Fourth of July recess, Republican sources said, to ensure that the whole year isn’t consumed by health care and that the GOP leaves room to consider tax reform.
It’s a gut-check situation for Republicans, who are about to be confronted with tough choices that may result in millions fewer people with insurance coverage as a condition for cutting taxes and lowering some people’s premiums.
While it’s possible that McConnell is pushing this accelerated schedule because he thinks it’ll produce a bill that passes before anyone has a chance to realize what’s happening, that seems like a long shot, particularly given how many Republicans are expressing doubts about whether they can get the 50 votes they need to pass it (the current GOP margin in the Senate is 52 to 48):
That’s a whole lot of skepticism. One big problem they’re facing is that there are multiple factions and working groups among Senate Republicans, all potentially coming up with their own very different versions of the bill. That’s a result of McConnell’s decision not to run the bill through the ordinary committee process, since he didn’t want there to be public hearings at which Democrats would have a chance to speak and question witnesses. In that vacuum, everyone wants to exercise their own influence. So apart from the 13-member group that McConnell appointed, there’s also a group led by Sen. Susan Collins (R-Maine) and Sen. Bill Cassidy (R-La.), and a group led by Sen. Rob Portman (R-Ohio).
But the intractable problems are likely to be substantive. Can senators from states that have benefited hugely from the ACA’s Medicaid expansion — such as West Virginia, where 28 percent of the state population is now enrolled in Medicaid, including 170,000 citizens who got it because of the expansion — come to an agreement with senators such as Ted Cruz (Tex.) and Mike Lee (Utah) who would like to see Medicaid undermined if not utterly destroyed? And can they all agree on something that can also get a majority in the House, where ultra-conservative Freedom Caucus members wield so much power?
So here are the potential outcomes:
https://morningconsult.com/2017/06/05/spotlight-obamacare-publics-opinion-drugmakers-softens/
Consumer perceptions of several major pharmaceutical companies have softened in recent months amid an industry push to counter public uproar over high drug prices, Morning Consult Brand Intelligence data show.
Large drugmakers this spring have seen a decline in the the percentage of Americans who view them unfavorably, according to weekly national surveys of thousands of U.S. adults.
The Pharmaceutical Research and Manufacturers of America, the industry’s largest trade group, took action in January to revamp its public image by rolling out a multiyear ad campaign that promotes breakthrough medicines. The drug lobby, which consistently outspends other industries in an effort to exert influence on Capitol Hill, spent $245 million last year, an increase of more than $18 million since 2013, according to the Center for Responsive Politics.
The shift in public opinion has occurred amid GOP efforts to overhaul the nation’s health insurance system and the high-profile battle over the Affordable Care Act. The White House has prioritized replacing the 2010 ACA over lowering drug prices, though newly installed Food and Drug Administration Commissioner Scott Gottlieb announced last month that his agency is looking for ways to reduce some costs to consumers.
Since the House GOP health care legislative effort began in earnest in March, some of the most unpopular drugmakers have seen declines in the percentage of Americans who view them unfavorably. Still, favorability rankings for drugmakers have not improved significantly.
Some of the most-liked drugmakers include Johnson & Johnson and Bayer — the most well-known drug manufacturers among U.S. consumers.
Results are based on online surveys, with a nationally representative sample of adults, that ask participants if they have a favorable or unfavorable impression of certain companies.
Pfizer, which last year killed a proposed $160 billion merger with Allergan after the Obama administration announced new rules on tax inversions, had the highest unfavorability percentage among drugmakers tracked in March, at 29 percent. As of June 5, that figure had fallen to 12 percent.
Another drugmaker – Bristol-Myers Squibb – saw its unfavorability decline 13 percentage points during the same time period, from 23 percent in March to 10 percent in June. Merck had its unfavorable views peak at 25 percent in March before falling to 12 percent in June.
http://www.healthleadersmedia.com/health-plans/ahca-defeat-not-end-repeal-efforts-analysts-say
he American Health Care Act (AHCA) may have been scrapped, but that doesn’t mark the end of efforts to repeal the Affordable Care Act (ACA).
Instead, opponents will likely take a piecemeal approach to dismantling the ACA through administrative action, analysts said.
The Trump administration is unlikely to renew its push to repeal and replace the ACA through a single bill like the AHCA, but may attempt to water down elements of healthcare reform through administrative actions designed to reduce federal subsidies and weaken health insurance exchanges.
The War Isn’t Over
“This is an enormous, significant defeat, but I don’t think the war on the ACA is over yet,” said Gerald Kominski, PhD, director of the UCLA Center for Health Policy Research.
“Of course, the White House can disrupt the Affordable Care Act by issuing regulations that destabilize the market and make it more difficult to renew [coverage] or enroll for the first time.”
In January, the Trump administration took actions along those lines when it cut federal funds designed to help state health exchanges advertise and reach consumers with notices about the annual deadline for open enrollment.
The Trump administration could attempt to reduce or eliminate federal subsidies and take other actions to weaken state and federal health insurance exchanges, said Micah Weinberg, president of the Bay Area Council Economic Institute.
“First, the Trump administration needs to decide whether they want to burn down the house we’re all living in through regulatory actions that will end the viability of the exchanges,” said Weinberg. “If they want to destroy the thing, they can. So the ACA is very much not out of the woods.”
San Francisco’s universal health care plan eyed as model for California
Maria Consuelo believes she’s alive today because of a groundbreaking program this left-leaning city created a decade ago – one that guarantees health coverage to every one of its 864,000 residents.
It’s made San Francisco the only place in the country where truly universal health coverage exists, similar to what’s available in every other developed nation. Called Healthy San Francisco, it offers health care to those who can’t afford private insurance and are ineligible for other government health programs.
In Consuelo’s case, she visited a government-funded clinic in the fall of 2015 and told a doctor she had pain in her pelvis. Tests later showed cancer in her ovaries, leading to successful surgery to remove them in January 2016.
“This law really helped me,” Consuelo, a 55-year-old mother of five grown children, said while waiting to pick up some medication last week at San Francisco General Hospital. “If it could help others, that would be great.”
A similar thought is percolating in the mind of Lt. Gov. Gavin Newsom, a Democrat who helped implement the plan when he was San Francisco’s mayor.
Now, two years after he launched his campaign to succeed Gov. Jerry Brown, Newsom has been wondering: Would such a program work in every county in the Golden State?
His suggestion comes at a time when proposals for universal health care are receiving a surprising amount of attention. Last week, Sens. Ricardo Lara, D-Bell Gardens, and Toni Atkins, D-San Diego, unveiled details of their bill to create a single-payer system that would cover all California residents – just a few days after Vermont Sen. Bernie Sanders vowed to introduce a bill to launch a similar system nationwide.
Ironically, all of the universal health care buzz is coming after the GOP’s plan to replace the Affordable Care Act with a bare-bones substitute plan collapsed. The Congressional Budget Office had estimated that the Republican plan would have decreased the federal deficit by more than $300 billion, but increased the ranks of uninsured Americans by 24 million by 2026.
But Republicans in Congress are still vowing to chip away — if not replace — the law, commonly called “Obamacare,” which has insured five million Californians since 2014, bringing down the state’s uninsured rate from 17 percent to 7.1 percent in just three years.
Cutting Medicaid by more than $860 million over the next decade would be a credit negative for states and not-for-profit hospitals, both of which would be left scrambling for alternative funding to cover the loss, according to a new report from Moody’s Investors Service.
Last week the Trump administration unveiled a budget proposal that includes $610 billion in cuts to core Medicaid services, and an additional $250 million in reductions to Medicaid expansion programs created under the Affordable Care Act.
The following day, the Congressional Budget Office released its scoring of the revised American Health Care Act – the Republican plan to repeal and replace the Patient Protection and Affordable Care Act and estimated that it would reduce Medicaid spending by $834 million through 2026.
“The proposals significantly change the longstanding Medicaid financing system and are credit negative for states and not-for-profit hospitals,” Moody’s said in an issues brief.
For states that don’t have the luxury of ignoring budget imbalances, the changes would increase pressure to either kick people off Medicaid, increase the state share of Medicaid funding, or cut payments to hospitals and other providers, Moody’s says.
Hospitals, particularly those serving a high mix of Medicaid patients, could expect to see reimbursement cuts and more cases of uncompensated care as Medicaid patients lose the coverage they’d gained under the ACA’s expansion.
Medicaid is already a significant budget burden for states, consuming between 7% to 34% of state revenue and averaging 16%.
Under the ACA, bad debt expense at not-for-profit hospitals in states that expanded Medicaid eligibility declined on average by 15% to 20% since 2014, enhancing these hospitals’ cash flow. Similarly, the gains in insurance coverage lowered the nationwide uninsured rate to approximately 11%, with uninsured rates even lower in states that expanded their Medicaid rolls, Moody’s says.
“Although the budget would give states limited new flexibility to adjust their Medicaid programs, the measure overall reflects a significant cost shift away from federal funding to states,” Moody’s says. “This cost shift is significant and would force states to make difficult decisions about safety-net spending for hospitals that serve large numbers of indigent patients.”
Medicare Advantage plans have played an increasingly larger role in the Medicare program as the share of Medicare beneficiaries enrolled in Medicare Advantage has steadily climbed over the past decade. The trend in enrollment growth is continuing in 2017, and has occurred despite reductions in payments to plans enacted by the Affordable Care Act of 2010 (ACA). This Data Spotlight reviews national and state-level Medicare Advantage enrollment trends as of March 2017 and examines variations in enrollment by plan type and firm. It analyzes the most recent data on premiums, out-of-pocket limits, and quality ratings. Key findings include:
Medicare Advantage enrollment is projected to continue to grow over the next decade, rising to 41 percent of all Medicare beneficiaries by 2027.1 As private plans take on an even larger presence in the Medicare program, it will be important to understand the implications for beneficiaries covered under Medicare Advantage plans and traditional Medicare, as well as for plans, health care providers and program spending.
HENRY KOTULA 