Kamala Harris’ ‘Medicare for all’ would mean massive disruption for healthcare, and the industry is prepared to fight it

https://www.washingtonexaminer.com/policy/healthcare/kamala-harris-medicare-for-all-would-mean-massive-disruption-for-healthcare-and-the-industry-is-prepared-to-fight-it

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Democratic presidential contender Sen. Kamala Harris wants to “move on” from the current healthcare system in favor of a plan that would roll everyone in the U.S. onto a government plan known as “Medicare for all,” doing away with private health insurance.

As the California Democrat and others in her party make their case, however, they will face considerable opposition not only in the insurance industry, but across the healthcare sector, which would see massive upheaval from the plan. And polling suggests that the public, roughly half of which relies on private insurance, isn’t quite on board.

Drug companies, insurers, doctors, and hospitals have united in recent months to fight national government healthcare. One healthcare industry group, called the Partnership for America’s Health Care Future, has launched a five-figure digital ad campaign arguing that “Medicare for all” would cause massive disruption, higher taxes, lower quality care, and less choice for patients. It plans to spend six figures bashing “Medicare for all” over the course of 2019.

“Whether it’s called Medicare for all, single payer, or a public option, one-size-fits-all healthcare will mean all Americans have less choice and control over the doctors, treatments, and coverage,” said Lauren Crawford Shaver, the group’s executive director.

Other candidates for the Democratic nomination, such as Sens. Elizabeth Warren of Massachusetts and Kirsten Gillibrand of New York, are, like Harris, co-sponsors of the Medicare for All Act, legislation led by Sen. Bernie Sanders, I-Vt. Although it has “Medicare” in the name, the bill would go much further than current Medicare, which covers adults 65 and older and people with disabilities. It would pay for emergency surgery, prescription drugs, mental healthcare, and eye care without a copay.

Children would be enrolled in the government plan soon after the the bill’s passage, and the rest would be gradually phased in after four years. This would mean that roughly half of the U.S. population, the 177 million people in the U.S. covered by private health insurance mostly through work, would be moved onto a government plan. Employers would pay higher taxes rather than pay for private plans.

In defending the need for a government system, Sanders has blasted insurance companies, saying upon unveiling the bill that they “make billions of dollars in profits and make industry CEOs extremely wealthy.”

But healthcare providers, not just insurers, benefit from the current fragmented system, in which insurance is purchased by employers, the government, and individuals. They charge private insurers more to make up for the gap left by patients who are uninsured or are on government programs, which pay less for their services.

If all privately insured individuals were to have Medicare instead, and if it were to pay the same rates it does now, then doctors and hospitals would see big losses caring for patients who moved from private coverage to the government plan. Healthcare providers have said that if taxes don’t go up to pay for the difference, then doctors and hospitals will face pay cuts and layoffs, leading to facility closures and long lines for care.

Hospitals serve as the main employer in many communities. For patients, that would mean losing not only a healthcare plan they might be satisfied with, but also doctors they worked with for years or hospitals they relied on in their communities.

The Medicare for All Act has not been scored by the Congressional Budget Office, but analyses from the Mercatus Center at George Mason University and the left-leaning Urban Institute found it would raise government spending over a decade by $32.6 trillion.

Overall healthcare spending, though, would actually fall by $2 trillion, as private spending on healthcare would collapse. The cut would be achieved, however, through paying 40 percent less to providers than what they were getting from private insurance.

Another obstacle to “Medicare for all” is the fact that the public isn’t fully convinced by the idea of nixing private insurance, a recent poll from the Kaiser Family Foundation shows. Initially, 56 percent of those polled favored the Medicare for All Act, but then when they learned it would do away with private health insurance, the support fell to 37 percent.

Candidates are going to face pushback within their party. House Speaker Nancy Pelosi and other Democratic leaders have not embraced government healthcare, instead pushing for adding funding to Obamacare.

But proponents of allowing the government to have a more extensive role in healthcare point out that waste is prevalent in the current system. Patients receive unnecessary medical care, such as repeated tests or surgeries that either don’t make them healthier or even make them worse.

These proponents agree with Harris that health insurance companies are unnecessary. Wendell Potter, an advocate of a government-financed healthcare system and president of the Business Initiative for Health Policy, said in a statement that polling results show the healthcare industry’s misinformation campaign to spread “fear, uncertainty, and doubt” was effective. He said that commercial health insurance companies don’t have an incentive to lower healthcare costs and make sure patients can access care.

Potter, a former health insurance executive, described how the information campaign worked, saying the goal was to “make people believe that private health insurance companies were a necessary part of the healthcare system, and to scare them into thinking that a ‘Medicare for all’ system was expensive and impractical, and that it would cause a significant drop off in the quality of care.”

 

 

 

 

Terminating Cost-Sharing Reduction Payments

http://www.healthaffairs.org/podcasts/terminating-cost-sharing-reduction-payments

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In a WTOP-FM interview, Alan Weil assesses the CBO’s report on the impact on premiums and the deficit if CSR payments were eliminated.

 

Time Crunch Among Hurdles for Bipartisan Senate Push to Bolster ACA

https://morningconsult.com/2017/08/18/time-crunch-among-hurdles-bipartisan-senate-push-bolster-aca/

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The leaders of a key Senate committee say they are cautiously optimistic about reaching a deal to shore up the Affordable Care Act’s individual marketplaces, but even with a bipartisan effort, it is far from certain whether they can hash out an agreement in time.

The Senate Health, Education, Labor and Pensions Committee leaders of both parties have set a self-imposed mid-September deadline for a bipartisan agreement. To keep lingering animosity from the Obamacare repeal fight from seeping into negotiations, Chairman Lamar Alexander has made clear that what he’s seeking is far from comprehensive.

The bill will have to be “small, bipartisan and balanced,” the Tennessee Republican said in a statement Wednesday.

Above all, Democrats want to make sure insurers continue to receive payments that help them cover out-of-pocket costs for some low-income patients. President Donald Trump has threatened to cut off the payments, and the administration has kept insurers on tenterhooks by making them only on a month-to-month basis.

Without the subsidies, known as cost-sharing reductions, some insurers warn they’ll be forced pull out of the ACA markets or hike premiums. The companies need certainty about payments at the latest by Sept. 27, the final deadline for them to decide whether to sell Obamacare plans in 2018.

If the committee can reach agreement next month, it would still be a challenge to get a bill through the full Senate and House before the key deadline for insurers. And Trump would still have to sign a bill into law that extends payments he is loath to continue.

The potential for chaos was highlighted this week when the nonpartisan Congressional Budget Office released a report estimating average premiums would rise 20 percent next year and the federal deficit would grow by $194 billion by 2026 if the administration stops paying.

While some conservative hard-liners want to cut off the CSRs, Alexander and other top Republicans have shown they’re willing to work with Democrats to have Congress extend the payments.

Sen. Patty Murray of Washington, the panel’s ranking Democrat, on Thursday called for quick action.

“People across the country are facing much higher premiums next year because of uncertainty driven by the Trump Administration, so I hope Republicans will join Democrats to act quickly to protect patients and families from paying more for care they need — and then continue working in a bipartisan way to make health care more affordable, accessible, and higher quality for all,” Murray said in a statement.

Democrats also want some sort of reinsurance program, an idea that has bipartisan support and would help insurers pay for their most expensive enrollees.

But in return for extending CSRs and including reinsurance, Republicans want to give states more authority over their health care systems, and Democrats could balk at some of their proposals.

Alexander has specifically pointed to changing the ACA’s 1332 waiver program, which allows states to opt out of key ACA regulations as long as it doesn’t lead to reduced coverage, skimpier benefits, more expensive insurance or a higher federal deficit.

In remarks to reporters earlier this month, Alexander noted a proposal that would eliminate all of those requirements besides increasing the federal deficit, in order to give states “more of an opportunity to approve insurance plans.” The plan, which was included in Senate Republicans’ health overhaul bill, would also bar the administration from rejecting a waiver as long as it doesn’t increase the federal deficit.

Democrats would likely oppose that proposal, wary of allowing states to undercut key Obamacare requirements without those other conditions in place.

Sen. Tim Kaine (D-Va.) said he’s interested in a proposal from Sens. Bill Cassidy (R-La.) and Susan Collins (R-Maine) to let states replace Obamacare’s most contentious provision — the mandate requiring people to purchase health insurance or pay a penalty — with a system that automatically enrolls individuals in low-cost coverage if they don’t do so on their own.

Backers of this approach argue it would offer comparable coverage to the individual mandate while being less intrusive, allowing people to opt out.

“I think that’s intriguing,” Kaine said earlier this month in a brief interview. “We ought to have that discussion, but you can’t blow the mandate without something to bring people into the program and do what insurance needs to do, which is to spread risk.”

But auto-enrollment has raised concerns among some liberal health care analysts, including over how to implement and administer such a system. The outstanding questions cast doubt on whether it could garner enough backing to be included in the stabilization bill.

CBO: ObamaCare premiums could rise 20 percent if Trump ends payments

http://thehill.com/policy/healthcare/346646-cbo-obamacare-premiums-could-rise-20-percent-if-trump-ends-payments

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Insurance companies would raise premium prices about 20 percent for ObamaCare plans if President Trump ends key payments to insurers, according to the Congressional Budget Office (CBO).

At the request of House Democratic leadership, CBO estimated what would happen if the payments to insurers ended after December. It found that halting payments would increase the federal deficit by $194 billion through 2026.

Many people would be cushioned from the impact of the increases because federal tax credits rise automatically when premiums do.

If the payments ended, some carriers would withdraw from ObamaCare and about 5 percent of people would live in an area without any options on the exchanges in 2018, according to CBO. But by 2020, CBO estimates more insurers would participate again, so that most areas would be covered.

The number of people without insurance would be slightly higher next year but a little lower in 2020, according to the analysis.

Cost-sharing reduction payments are made to insurers, compensating them for discounting out-of-pocket costs for certain enrollees.

Insurers have been pleading for certainty from the administration on whether they’ll continue to receive the payments, which total about $7 billion for fiscal 2017.

The administration has been making these payments on a monthly basis. But Trump has threatened to halt the funds, calling the money “bailouts” for insurance companies.

The issue has also been caught up in court, and if Trump decides to stop appealing a court ruling against the administration, CSR payments could stop. The deadline for another update is coming up quick — Aug. 20. The case has been on hold for months and could be delayed again.

Additionally, the Senate Health Committee will hold hearings on a bipartisan, short-term stabilization measure the first week of September. The goal, according to Chairman Lamar Alexander (R-Tenn.), is to craft a bill by mid-September that includes funding the payments to insurers.

But insurers are bumping up against major deadlines.

Last week, the administration extended the deadline for carriers to finalize how much their premiums will cost on HealthCare.gov. That date is now Sept. 5, and insurers sign contracts locking them into selling plans Sept. 27.

If insurers don’t know if CSRs will be funded, they could exit the marketplaces, health experts warn. That could possibly lead to some areas have no insurers selling plans on their exchanges.

 

CBO: Ending cost-sharing reduction payments will increase premiums, federal deficit

http://www.fiercehealthcare.com/aca/cbo-ending-cost-sharing-reduction-payments-will-increase-premiums-federal-deficit?mkt_tok=eyJpIjoiTVdKa1pEazNOMll5WVRreiIsInQiOiJkaVJDVnRHOXNNXC9ENmt6WFpTTFwvZGVQeThhQVRjZHR2VE9jUEVQQUtlZ3BxUFg0akRMM0FOK2hWZUc4ajJ4WVdzOUV3Z21GM1cyU1VVOWNDekZ2aVwvZG11VnFVVDQ3WEJvejBQU3ZVZTM4bjZyK3A1VjlcL3Q0Mmtsc3VJUTErS0wifQ%3D%3D&mrkid=959610&utm_medium=nl&utm_source=internal

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If the Trump administration stops funding cost-sharing reduction payments, silver-plan premiums on the Affordable Care Act exchanges will rise considerably and the federal deficit will increase, the Congressional Budget Office said Tuesday.

Officially, the administration remains undecided about how long it will continue making CSR payments, which are at the center of a federal court case that challenges their legality. Many insurers have had to factor this uncertainty into their preliminary rate filings.

To map out the consequences of one possible move by the administration, the CBO examined what would happen if federal officials announced at the end of August that they would continue CSR payments through the end of the year but discontinue them after that.

That policy would result in silver-plan premiums rising by an average of 20% in 2018 and 25% by 2020, the CBO estimates. Because tax credits rise in tandem with premiums, most eligible enrollees would not pay higher rates than they would if CSR payments continued—though the report also notes that overall, “the share of people facing slight increases would be higher during the next two years.”

Since more people would likely receive premium tax credits and in greater amounts, the CBO predicts that ending CSR payments would raise the federal deficit by $6 billion in 2018, $21 billion in 2020 and $26 billion in 2026.

The CBO also predicts that ending CSR payments would cause some insurers to exit the individual marketplaces, leaving about 5% of people living in areas that have no ACA exchange insurer in 2018. However, the agency predicts that more insurers would likely return to the exchanges in 2020 after having adjusted to the new policy.

Overall, the number of uninsured people would be slightly higher in 2018 but slightly lower starting in 2020 under the scenario the CBO examined, per the report.

CBO to release analysis of ending key ObamaCare insurer payments

http://thehill.com/policy/healthcare/346200-cbo-to-release-analysis-of-ending-key-obamacare-insurer-payments

CBO to release analysis of ending key ObamaCare insurer payments

The nonpartisan Congressional Budget Office (CBO) will release an analysis next week detailing the effects of ending key ObamaCare insurer payments.

The CBO announced Friday the score would be released next week.

President Trump has threatened to cancel the payments, known as cost-sharing reductions, which reimburse insurers for giving discounted deductibles and copays to low-income people.

The administration has made the payments on a month-to-month basis but insurers have pleaded for long-term certainty.

The reimbursements total $7 billion for fiscal 2017, and regardless of whether the administration pays them, insurers would still be on the hook to offer these discounts to enrollees — they just wouldn’t be reimbursed for doing so.

Uncertainty over the future of the payments has contributed to insurers exiting the healthcare exchanges and proposed premium increases for 2018. More insurers might leave or increase premiums if the payments aren’t continued.

The Senate Health Committee will hold bipartisan hearings in September on ways to stabilize and strengthen the individual market.

The goal is to craft a bipartisan, short-term proposal by mid-September, which could include funding the payments.