Tag Archives: Health Insurance Coverage Adequacy

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.

Medicaid Changes in Better Care Reconciliation Act (BCRA) Go Beyond ACA Repeal and Replace

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Medicaid Changes in Better Care Reconciliation Act (BCRA) Go Beyond ACA Repeal and Replace

Medicaid Changes in Better Care Reconciliation Act (BCRA) Go Beyond ACA Repeal and Replace

The Senate released an updated discussion draft of legislation called the Better Care Reconciliation Act of 2017 (BCRA) on July 20, 2017. For Medicaid, the overall framework is very similar to earlier versions of the bill in the Senate as well as the American Health Care Act (AHCA) that passed in the House. Both the BCRA and the AHCA go beyond repeal and replacement of the Affordable Care Act (ACA) to make fundamental changes to Medicaid by setting a limit on federal funding through a per capita cap or block grant. The BCRA also includes additional changes that would further reduce federal spending for states with high per enrollee spending, limit state financing mechanisms, allow states to impose work requirements, and make other eligibility changes. The revised draft of the BCRA leaves many provisions up to HHS Secretary discretion, creating further uncertainty for states about how implementation of the legislation would proceed. Across the board, these changes would have significant implications for the 74 million people covered by the Medicaid program and for states that jointly finance and administer the program.

The Congressional Budget Office estimates that under current draft of the BCRA, federal Medicaid spending related to the coverage provisions would decline by $756 billion over the 2017-2026 period or $739 billion accounting for all Medicaid provisions in the bill. According to CBO’s longer-term projections, the BCRA would reduce federal Medicaid spending by 35% in 2036 (Figure 1). These reductions would leave states with difficult choices about how to fill in the gaps in federal funding or cut back on Medicaid eligibility, benefits, or reimbursement rates (Figure 2). This brief explains the five most significant Medicaid changes in the BCRA as well as additional Medicaid changes that could have major implications for states, providers, and beneficiaries.

5 Most Significant Medicaid Financing Changes in the BCRA

1. Phase out the enhanced federal financing for the ACA Medicaid expansion.

Under the BCRA, for states that adopted the expansion as of March 1, 2017, the enhanced federal match would phase-out from 90% in CY 2020, to 85% in 2021, 80% in 2022, 75% in 2023 and then to the regular state match rate in 2024 and beyond. Thirty-one states plus DC have implemented the Medicaid expansion (Figure 3). On average, expansion enrollees account for 20% of all Medicaid enrollees (as of early 2016) and federal expansion financing accounts for about 21% of all Medicaid funding (for FY 2015). However, these shares are much higher in some states, placing them at higher risk for facing challenges in responding to the reduction in the federal match. Multiple states are likely to eliminate or scale back their expansion coverage due to the increased cost if federal funding is reduced, including eight expansion states (AR, AZ, IL, IN, MI, NH, NM, and WA) that have legislation requiring them to reduce or eliminate the expansion if the federal match rate is reduced. Given the magnitude of estimates of how much it would cost states to replace federal expansion funds, it appears that it is unrealistic to suggest that expansion states would be able to replace those funds and continue their expansion programs at current levels without the enhanced expansion match rate. Reports suggest that waivers or additional grant funding may be offered to states in place of the enhanced funding for the expansion, however, it is unlikely that such amounts would fully offset federal funding reductions in the BCRA tied to the expansion.

2. Limit federal Medicaid funding through a per capita, or per enrollee, cap on financing.

Under current law, Medicaid provides a guarantee of coverage for individuals who are eligible for the program and a guarantee to states of federal matching dollars for spending on Medicaid services. Beginning in FY 2020, the BCRA would limit federal Medicaid funding to each state based on the sum of the costs per enrollee for five beneficiary groups – elderly, blind and disabled adults,1 children, expansion adults, and other adults – multiplied by the number of enrollees in the group and the state’s federal match rate. The proposed legislation specifies a uniform national inflation factor for the federal financing growth rate. Under both AHCA and BCRA, the per enrollee amounts would increase annually at slower rates than projected growth for Medicaid.

The caps are estimated to result in large reductions in federal Medicaid spending over time. Under BCRA, the caps would initially grow by the Consumer Price Index for medical care (CPI-M) for adults and children and by the CPI-M plus one percentage point for elderly and disabled groups. Starting in 2025, per enrollee amounts for all groups would increase by the historically lower CPI for urban consumers (CPI-U). All of these rates are lower than projected growth for private health insurance spending per enrollee. Reductions in federal Medicaid funding from the caps are expected to grow over time, especially after 2025 when the inflation factor is limited to CPI-U. Current projections have CPI-M growing at 3.7% and CPI-U at 2.4% annually; however, the rate of growth for these indices can vary and fluctuate over time which could cause uncertainty and instability in state budgeting.

3. Provides Secretary discretion to adjust per enrollee spending down for states with per enrollee spending 25% higher than the national average.

The BCRA also includes a provision not included in the AHCA, which would direct the HHS Secretary to adjust target per enrollee amounts under the per capita cap to bring states closer to national average spending. Specifically, the Secretary would adjust a state’s target per enrollee amounts by 0.5% to 2% for states spending 25% or more either above or below the national average per enrollee expenditures beginning in 2020. These adjustments are applied to overall per enrollee spending in 2020 and 2021 and then for each enrollment group in subsequent years. Adjustments are to be budget neutral to the federal government (meaning they would not result in a net increase of federal payments under the per capita caps for the fiscal year). Certain states with population densities less than 15 individuals per square mile (currently: AK, MT, ND, SD, and WY) would be exempt from this provision. Data for 2014 show that the number of states with high per capita spending that face tighter caps exceeds the number of states that would experience relief for having low spending overall and for each eligibility group (Table 1). Secretary discretion and actual spending patterns will make it difficult for states to estimate the effect of this provision.

4. Allow states the option to choose block grant financing for non-expansion Medicaid adults.

Beginning in FY 2020 under the BCRA, states could elect to receive federal financing for nonelderly/non-disabled traditional adults (low-income parents and pregnant women) and/or adults eligible through the ACA Medicaid expansion in the form of block grant instead of per capita cap funding. The block grant amount that states would receive from the federal government is initially based on the state’s target per capita spending amount for the fiscal year multiplied by the number of adult enrollees and the federal average Medicaid matching rate. The amount would grow annually by CPI-U even prior to 2025 when the per capita cap amounts would grow by the higher CPI-M inflation factor. States have a maintenance of effort (MOE) requirement—essentially, a minimum amount states must spend each year—that is the state share of the enhanced CHIP match rate (without the 23 percentage point increase provided under the ACA) multiplied by the block grant amount. If a state fails to meet the MOE requirement in a given year, its federal block grant amount for the following year would be reduced. States that meet MOE and continue to elect the block grant option can rollover unused block grant funds into the next fiscal year.

Under the block grant option, states could impose conditions of eligibility and not comply with key provisions in current law like comparability and state-wideness.  Under the block grant option, states would be required to cover low-income parents and pregnant women at current federal minimum income levels and provide certain benefits. However, states could set conditions of eligibility for groups beyond these federal minimum groups, including for ACA expansion adults. Additionally, states electing the BCRA block grant option would not have to comply with other federal requirements, including comparability (the requirement that Medicaid-covered benefits be provided in the same amount, duration, and scope to all enrollees), state-wideness (the requirement that bars Medicaid programs from excluding enrollees or providers because of where they live or work in the state), and freedom of choice of provider (that allows beneficiaries to be permitted to choose among any provider participating in Medicaid). Like per capita caps, Medicaid block grants fail to account for changes in health care costs over time. Block grants also carry additional risk for states, providers, and beneficiaries because they do not account for changes in Medicaid enrollment (which could increase during an economic downturn).

5. Provides the HHS Secretary discretion to allocate funds to address the opioid crisis and public health emergencies. 
The BCRA appropriates $45 billion for FY 2018 through FY 2026 for grants to states to support substance use disorder treatment and recovery support services with significant discretion to the HHS Secretary to allocate the funds. The BCRA also provides the HHS Secretary with discretion to exclude from a state’s per capita cap or block grant limit a total of $5 billion across all states for Medicaid spending in response to a public health emergency from January 2020 through December 2024. This exclusion would only apply during a period in which the HHS Secretary has declared a public health emergency in a state or region and also deemed an exclusion appropriate. Under current law, states can increase spending with a guaranteed federal match or seek waivers (like in Flint, MI or for states hit by hurricane Katrina) to address public health emergencies.

Other Significant BCRA Medicaid Changes

Other BCRA Medicaid changes with significant implications for states, providers, and beneficiaries include the following:

Limiting states’ ability to use provider taxes to finance their share of Medicaid by lowering the provider tax safe harbor threshold2 from 6.0% to 5.0% of net patient revenues over 5 years, beginning in 2021. All states except for Alaska currently use provider taxes to finance the state share of Medicaid, and in 2016, 28 states had at least one tax exceeding 5.5% of net patient revenues. The proposed BCRA change could shift additional costs to states or result in additional reductions in Medicaid payment rates, services, or eligibility.

Creating a state option to require work as a condition of eligibility for nondisabled, nonelderly Medicaid adults as of October 1, 2017 (with some exemptions for certain groups including pregnant women or the sole caretaker of a child under age 6 or a child with a disability). Depending on how they are implemented, work requirements could increase administrative burdens on states and adversely affect some people, who are unable to comply due to their health, family caregiving obligations, or other reasons, by preventing them from accessing needed health coverage through Medicaid.3

Cancelling scheduled disproportionate share hospital (DSH) payment reductions for non-expansion (but not for expansion) states. The BCRA would exempt non-expansion states from the DSH reductions that were included in the ACA. During FY 2020-FY 2023, the BCRA would also provide a DSH payment increase to non-expansion states with per capita FY 2016 DSH allotment amounts (the FY 2016 DSH allotment divided by the number of uninsured individuals in the state for the fiscal year) that are below the national average per capita amount. A state qualifies as a non-expansion state if it is not covering expansion adults on or after January 1, 2021. This means that current expansion states that discontinue their expansions by the end of 2020 could qualify for increased DSH funds after their expansion ends. In addition, the BCRA would provide certain non-expansion states with $10 billion over 5 years (FY 2018-FY 2022) for safety-net funding.

Changing eligibility and enrollment processes with new requirements for eligible individuals to obtain and maintain Medicaid coverage. Changes include: repealing the requirement for states to cover Medicaid benefits retroactively for three months prior to the month of an individual’s enrollment in the program except for enrollees who are eligible based on old age or disability only); prohibiting hospitals from temporarily enrolling individuals in Medicaid if they are likely to be eligible under a state’s Medicaid eligibility rules (a policy known as “hospital presumptive eligibility”); removing a presumptive eligibility option that includes health care providers other than hospitals for expansion adults; and giving states the option to renew eligibility of Medicaid expansion adults every six months (or more frequently) compared to the current 12 month redetermination period.

Prohibiting federal Medicaid funding for Planned Parenthood for one year (beginning on the date of enactment). The Hyde Amendment already prevents the use of federal funds for abortion services,4 so the effect of this proposed policy would be to limit Planned Parenthood’s capacity to provide preventive care and other services to women (such as clinical breast exams or birth control).

Repealing the enhanced federal match rate available under the ACA for the Community First Choice (CFC) state plan option, as of January 1, 2020. The ACA established the CFC option to allow states to provide home and community-based attendant services and supports to Medicaid enrollees who would otherwise require an institutional level of care. States taking up the option currently receive a 6% increase in their federal match rate for CFC services, and without this additional funding states may eliminate the option. The BCRA also creates a demonstration that would provide 100% federal matching funds for certain states selected by the HHS Secretary providing home and community-based services (HCBS) for seniors or adults with disabilities under a Section 1915 (c) or (d) waiver or Section 1915 (i) state plan authority, limited to $8 billion over four years, from 2020 through 2023. The Secretary would select participating states with priority given to the 15 states with the lowest population density. Unlike CFC, the authority for this new demonstration is time-limited, all states likely could not participate, and federal funding is capped. The $8 billion allocated to the new demonstration is less than half of the cost of the elimination of CFC funding, estimated by the CBO at $19 billion over 10 years.

Increasing the federal match rate for Medicaid services provided to American Indians by non-Indian Health Services (IHS) providers. Under existing law, the federal government covers 100% of the costs of Medicaid-covered services provided to American Indians through an IHS or Tribally-operated facility, and the BCRA would expand this 100% match rate to apply to all Medicaid-covered services delivered by all Medicaid providers to Medicaid-eligible members of an Indian tribe.

Repealing the essential health benefit requirement in Medicaid alternative benefit plans, beginning in 2020. The alternative benefit plans are required for expansion adults and a state option for benefit package design for certain other populations. While the Medicaid benefit package for children under Early and Periodic Screening, Diagnostic and Treatment (EPSDT) is comprehensive, states have flexibility to design benefit packages for adults, and many services for adults are offered at state option. If the essential health benefits requirement were repealed, there would be no federal minimum requirement in Medicaid to ensure that adults have coverage in certain areas such as mental health and substance use disorder treatment.

Trump Plan Might Cut Expenses For Some Insured Patients With Chronic Needs

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Erin Corbelli takes three medications to treat high blood pressure, depression and an anxiety disorder. Her health plan covers her drugs and specialist visits, but Corbelli and her family must pay a $3,000 annual deductible before the plan starts picking up any of that tab.

Corbelli’s insurance is linked to a health savings account so that she and her husband can put aside money tax-free to help cover their family’s drug and medical expenses. But there’s a hitch: Plans like theirs can’t cover any care for chronic conditions until the deductible is satisfied.

Those out-of-pocket expenses could shrink under a Trump administration draft executive order that would change Internal Revenue Service rules about what care can be covered before the deductible is met in plans linked to health savings accounts, or HSAs.

“It would save us a lot of money,” said Corbelli, 41, who lives in Orlando with her husband and their two children, ages 3 and 5.

Health plans with deductibles of thousands of dollars have become increasingly commonplace. Plans often cover services like generic drugs or doctor visits before consumers have satisfied their deductibles, typically requiring a copayment or coinsurance rather than demanding that consumers pony up the entire amount.

But plans that link to health savings accounts have more restrictions than other high-deductible plans. In addition to minimum deductibles and maximum HSA contribution limits, the plans can’t pay for anything but preventive care before consumers meet a deductible. Under current IRS rules, such preventive care is limited to services such as cancer screenings and immunizations that prevent a disease or condition, called “primary prevention.” With HSA-eligible plans, medical services or medications that prevent an existing chronic condition from getting worse or prevent complications from occurring — called “secondary prevention” — can’t be covered before the deductible is paid.

The Trump administration’s draft executive order, which was first obtained last month by The New York Times and has yet to be issued, would allow such secondary preventive services to be covered.

Under the Affordable Care Act, most health plans, including HSA-eligible plans, are required to cover services recommended by the U.S. Preventive Services Task Force without charging consumers anything for them. That requirement is generally limited to primary prevention.

“We know health savings accounts are here to stay and we’d like to make them better,” said Dr. A. Mark Fendrick, an internist who is director of the University of Michigan’s Center for Value-Based Insurance Design and who has advocated for the change.

If people have diabetes, for example, they need regular eye and foot exams to prevent complications such as blindness and amputations down the road. But HSA plans can’t pay anything toward that care until people satisfy their deductible. “The executive order gives plans the flexibility to do that,” he said.

Similarly, it’s critical to remove obstacles to treatment for people like Corbelli with high blood pressure or heart disease, said Sue Nelson, vice president for federal advocacy at the American Heart Association.

“For people with cardiovascular disease, affordability is their No. 1 concern,” Nelson said.

The draft executive order is short on details, and administration officials would have to determine which new preventive services should be covered pre-deductible. Guidelines from medical specialty boards and quality metrics that many physicians are already being measured against could be used, said Roy Ramthun, president and founder of HSA Consulting Services who led the Treasury Department’s implementation of the HSA program in the early 2000s.

Back then, they took a conservative approach. “We said we can be more flexible later, but we can’t put the genie back in the bottle,” said Ramthun, who supports expanding preventive services coverage.

Many more employers would offer HSA-eligible plans if the list of services that could be covered pre-deductible were expanded, said Tracy Watts, a senior partner at human resources consultant Mercer. Fifty-three percent of employers with 500 or more workers offer HSA-eligible plans, according to Mercer survey data. Three-quarters of employers put money into their employees’ HSA accounts, she said.

Erin Corbelli’s husband’s employer contributes up to $1,500 every year to their health savings account, which can help cover their pre-deductible costs.

Not everyone is so fortunate. “You’re kind of at the mercy of what your employer can offer and what your disposable income is,” she said.

Republicans have long advocated for the expanded use of health savings accounts as a tax-advantaged way for consumers to get more financial “skin in the game.”

Consumer advocates have been much less enthusiastic, noting that the accounts typically benefit higher-income consumers who have cash to spare.

Still, given the reality of the growing prevalence of high-deductible plans, with or without health savings accounts, it’s a sensible proposal, many say.

“This is not a silver bullet or a solution to the problems that high-deductible plans can pose,” said Lydia Mitts, associate director of affordability initiatives at Families USA, an advocacy group. “But this is a good step in thinking about how we offer access to treatment people need in a timely and affordable way.”

Republican plan to ‘repeal and delay’ will leave millions more Americans uninsured

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http://www.politico.com/interactives/2017/republican-obamacare-repeal-uninsured-double/?lo=ap_a1

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Majority Leader Mitch McConnell wants to hold a vote on a bill that would repeal major parts of Obamacare and give Republicans two years to pass a replacement. A new CBO report finds that repealing Obamacare without a replacement would result in 32 million more Americans losing health insurance over a decade — far deeper coverage losses than any of the health plans Republicans have proposed. Further, 75 percent of Americans would live in areas without any insurers selling coverage in the individual market by 2026.

The latest GOP health plan would strike:

  •  Individual mandate
  •  Insurance subsidies
  •  Medicaid expansion
  •  Planned Parenthood funding

The bill would effectively kill Obamacare’s individual and employer coverage mandates, strike health insurance subsidies, roll back Medicaid expansion and defund Planned Parenthood.

Repealing Obamacare would more than double the number of Americans without health insurance.

Under Obamacare, 10 percentof Americans would lack health insurance.

But if Republicans repeal Obamacare, the number could grow to 21 percent by 2026.

NOTE: Data includes Americans under 65 who do not have health insurance and does not include persons who are Medicare-eligible.
SOURCE: Congressional Budget Office

The uninsured rate plunged under the ACA, but would now skyrocket

ACARepeal ACA0510152025%1997201020172026Before the ACAACA passed10%21%
NOTE: Data includes Americans under 65 who do not have health insurance
SOURCE: National Center for Health Statistics and the Congressional Budget Office

In the first year alone, nearly 17 million more people would no longer have insurance — or (16 percent) of Americans. That includes 10 million fewer buying plans on the individual market, 4 million fewer people covered through Medicaid, and 2 million fewer with job-based coverage.

But once Medicaid expansion and subsidies were repealed (roughly two years after enactment), the number of uninsured Americans would increase by 27 million in 2020. By 2026, about 59 million people or 21 percent of Americans would be uninsured.

CBO: ObamaCare repeal without replace would cost 32 million insurance

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CBO: ObamaCare repeal without replace would cost 32 million insurance

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Repealing ObamaCare without a replacement would result in 32 million people losing their insurance in the next 10 years, according to the Congressional Budget Office.
The bill, much of which would take effect in 2020, would also massively increase insurance premiums. According to the CBO, average premiums would increase by about 25 percent in 2018 alone. The increase would reach about 50 percent in 2020, and premiums would increase nearly 100 percent by 2026, CBO said.
Senate Republicans said this week they would consider voting on repeal only, after it appeared their replacement legislation had failed. However, negotiations attempting to revive repeal and replace continue and senators are scheduled to huddle Wednesday night to discuss if there’s a path forward.
The unfavorable score of the repeal-only bill could help jumpstart discussions about returning to the repeal-and-replace legislation.

A previous CBO score of the Senate’s repeal-and-replace bill estimated that 22 million people would lose insurance over the next decade.

The CBO hasn’t released a score on the most recent revision, which includes a controversial amendment from Sen. Ted Cruz (R-Texas).

The Senate will vote next week on a motion to proceed, though it’s not clear which bill Majority Leader Mitch McConnell (R-Ky.) wants to move to — a straight repeal or the repeal-and-replace legislation that seemed dead just days ago.

Both the House and Senate passed the “repeal-only” bill in 2015 that was vetoed by President Obama. Among other provisions, the “repeal only” bill would eliminate: ObamaCare’s individual and employer mandates, the Medicaid expansion, and subsidies for low-income individuals.

It would retain the requirements that protect people with pre-existing conditions from discrimination and would continue to require insurers to offer specific benefits.

According to the CBO “eliminating the penalty associated with the individual mandate and the subsidies for insurance while retaining the market regulations would destabilize the nongroup market, and the effect would worsen over time.”

Republicans have argued that they need to repeal and replace ObamaCare to “rescue” the growing number of people who live in counties with no insurers on the healthcare exchanges. But according to the CBO, repeal-only would make the problem worse.

The repeal-only bill would cause insurers to begin dropping out of the marketplace as soon as next year, the CBO said. It would also leave about half of the nation’s population without any ObamaCare insurers by 2020, a figure that would increase to about three-quarters of the population by 2026.

There’s No ‘Free Market’ Solution to Health Care

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http://otherwords.org/theres-no-free-market-solution-to-health-care/

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A fully privatized system can never adequately provision the nation.

The Republicans have big plans for health care in this country: to eliminate coverage for millions of Americans while delivering a big tax cut to the rich.

As someone who stands to benefit from that tax cut, let me just say: I don’t need it, and I don’t want it. No tax cut is worth excluding millions of Americans from the health services they need.

Any new health care legislation should be focused on providing the best available health services for all Americans, not deliberately putting them out of reach. And yet, this is exactly what the twin monstrosities that came out of the House and Senate would have done.

According to the Congressional Budget Office, the House bill would’ve left 23 million Americans uncovered by 2026. The Senate version was only a shade better, leaving 22 million people out. Those bills were nonstarters with the public — the party was forced to pull them, along with any immediate plans to repeal the Affordable Care Act (aka Obamacare).

This Republican-majority Congress has shown their cards: They favor less coverage for workers and the elderly and lower taxes for the wealthy.

Republicans in both chambers claim they’re doing this to support “freedom” and “choice” for the American people. They say the “free market” is the only way to provide Americans with access to affordable health care. They claim deregulation will help drive down health costs.

Well, for starters, so-called “free markets” are unicorns — fanciful creatures with magical powers that don’t exist in the real world. All markets are designed; they don’t emerge spontaneously from nature. We form, structure, regulate, and enforce markets through policy and institutions which reflect private and public interests.

When it comes to health care, we’re talking about something closer to a “natural monopoly” like electricity, not an industry like autos or breakfast cereals. Everyone needs basic medical services on a regular basis, and we need to make sure the same quality is available to everyone — even in hard to reach or low-income areas.

This will always require some form of direct government funding of services, especially with respect to primary care. Failing to do so means we’re not serious about the goal of quality care for all Americans.

This doesn’t necessarily mean an entirely government-run system — there’s plenty of room for private medical practices and businesses to provide the spectrum of services we need. But it does mean some degree of public funding is essential.

A fully privatized system can never adequately provision the nation. Rural communities don’t have adequate medical facilities and staff. Underdeveloped urban communities suffer from the same lack of basic resources, and their residents often don’t have the ability or time to travel to other locations.

Republican leaders claim they want affordable access to quality health care for all Americans, but all of their proposals have focused on lowering taxes on businesses and the rich, regardless of the very real cost in terms of human life.

It’s a false choice, and the effects will be cruel.

A healthy nation is a prosperous nation. This is primarily a challenge of real resources and the distribution of those resources, not of money. Congress can and should authorize any necessary funding to achieve the stated public goal simply by appropriating the funds.

This includes designing a system that will ensure there are enough facilities, doctors, nurses, specialists, transportation systems, and all the other elements of quality care in close proximity to all who need it — at any level of need and ability to pay.

Members of the House and Senate were put there by the voters and have an obligation to fight for and protect all of their constituents, not just the ones wealthy enough to bankroll their campaigns.

High-Risk Pools for People with Preexisting Conditions: A Refresher Course

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http://www.commonwealthfund.org/publications/blog/2017/mar/high-risk-pools-preexisting-conditions

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During the recent effort to repeal and replace the Affordable Care Act (ACA), some members of Congress and the Trump administration seemed to be experiencing a certain nostalgia for high-risk pools, which operated in 35 states before the ACA was enacted. At a CNN Town Hall Meeting in January, Speaker of the House Paul Ryan responded to a question about coverage for people with preexisting conditions by saying:

We believe that state high-risk pools are a smart way of guaranteeing coverage for people with preexisting conditions. We had a really good one in Wisconsin. Utah had a great one . . . . What I mean when I say this is, about 8 percent of all the people under 65 have that kind of preexisting condition . . . . So, by financing state high-risk pools to guarantee people get affordable coverage when they have a preexisting condition, what you’re doing is, you’re dramatically lowering the price of insurance for everybody else. So, if we say let’s just, as taxpayers—and I agree with this—finance the coverage for those 8 percent of Americans under 65 in a condition like yours, they don’t have to be covered or paid for by their small business or their insurer who is buying the rates for the rest of the people in their insured pool, and you’d dramatically lower the price for the other 92 percent of Americans.

As high-risk pools and other changes to the ACA continue to be debated, it is critical to deconstruct statements such as these and remind ourselves of how high-risk pools really worked and how unaffordable they were. It is important to remember that high rates of uninsurance and lack of affordability for all buyers in the individual market existed before the ACA, even in states with high-risk pools. In addition, policymakers seem to substantially underestimate the number of Americans with preexisting conditions who might be forced to purchase coverage through a high-risk pool if insurers are allowed to deny coverage in the marketplace.

Affordability and Costs of State High-Risk Pool Coverage Pre-ACA

High-risk pools were expensive because they concentrated people with health conditions into a single pool, with no healthy members to offset their costs. As a result, out-of-pocket costs for enrollees were very high and coverage was often quite limited, as administrators sought to limit losses and lower premiums by imposing high deductibles and cost-sharing, as well as annual and lifetime coverage caps. In state high-risk pools operating before the ACA:

  • Premiums ranged from 125 percent to 200 percent of average premiums in the individual market, yet covered only about 53 percent of claims and administrative costs nationally (Wisconsin allowed premiums up to 200 percent of average).
  • Fourteen states had plans with deductibles of $10,000 per year or higher, substantially greater than the current maximum $7,150 deductible for catastrophic plans in the marketplaces.
  • Thirty states imposed maximum lifetime limits; others had annual coverage limits as low as $75,000 per year (Utah had both a lifetime and an annual limit).
  • In 2010, the 35 state high-risk pools incurred about $2.4 billion in total costs—to cover just 221,879 people.

The U.S. Department of Health and Human Services (HHS) recently estimated that up to 17,875,000 people with preexisting conditions were uninsured in 2010. Had all of them been covered by high-risk pools, the cost would have been $194.8 billion in 2010 dollars, with premiums covering only $103.3 billion. Thus, states and the federal government would have needed to find $91.5 billion in additional funding to cover them all—much more than the up to $10 billion per year in federal assistance to states recently proposed by congressional Republicans.

Uninsured Rates When High-Risk Pools Were in Operation

In 2010, 32,939,000 people were uninsured in the 35 states that operated high-risk pools, and more than 47 million were uninsured nationally. In those states with high-risk pools, less than half of 1 percent of the total population was enrolled in them, and less than 1 percent of the uninsured population. That same year, The Commonwealth Fund found that 60 percent of people who shopped for health insurance in the individual market found it difficult or impossible to find a plan they could afford. This fact belies the claim that state high-risk pools made coverage for other people more affordable.

Percentage of Americans Under Age 65 with Preexisting Conditions

In the same Commonwealth Fund survey, more than one-third (35 percent) of those who sought insurance on the individual market reported being denied coverage or being charged a higher price because of a preexisting condition—certainly more than the 8 percent of people Speaker Ryan suggested would need to turn to high-risk pools for coverage. Indeed, based on federal survey data, HHS estimated that up to 51 percent of nonelderly Americans have preexisting conditions for which they could be denied coverage in the individual market.

Reality Check

The reality is that high-risk pool coverage was prohibitively expensive and there is little evidence to suggest that the existence of such pools made coverage less costly for others in the individual insurance market. Without substantially more federal funding than currently proposed, these facts are not likely to change. People with preexisting conditions may have “access” to coverage, but most will not be able to afford it and those who can will face limited benefits and extremely high deductibles and out-of-pocket payments.

Why and How to Avoid High-Risk Pools for Americans with Preexisting Conditions

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http://www.commonwealthfund.org/publications/blog/2017/jun/how-and-why-to-avoid-high-risk-pools

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The American Health Care Act (AHCA)—the U.S. House of Representatives’ bill to repeal and replace the Affordable Care Act (ACA)—would allow states to apply for waivers to reduce existing consumer protections and provide funding for states to set up high-risk pools or other mechanisms for people with preexisting conditions who have lapses in their coverage. In previous posts, I have talked about the high costs and meager coverage associated with high-risk pools that operated before the ACA and the fact that their use did not significantly reduce costs for other people who buy their own health plans in the individual market. Moreover, the Congressional Budget Office analysis of the AHCA finds that the funding it makes available to states for the high-risk pools is inadequate.

In a recent commentary for Annals of Internal Medicine on high-risk pools, I note that people with preexisting conditions constitute roughly 51 percent of Americans. Here, let’s explore who might end up in a high-risk pool, what their experiences might be, and policymakers’ alternative options for stabilizing the marketplaces.

The U.S. Department of Health and Human Services (HHS) estimated that 23 percent of Americans with preexisting conditions had a period of uninsurance in 2014, often because of job changes or periods of financial instability. Young people reaching age 26 who transition off their parents’ coverage also sometimes experienced gaps in coverage—and some of them have preexisting conditions. Should the AHCA become law, individuals with preexisting conditions and lapses in coverage who live in states that obtain waivers to allow insurers to charge people based on their health would likely end up in high-risk pools.

Research has shown that the greater out-of-pocket costs and limited coverage associated with high-risk pools led to enrollees forgoing needed care and experiencing worse outcomes. In fact, before the ACA, high-risk pool enrollees in Kansas were eight times more likely to transition to federal disability programs than members of the general population with these conditions.

Current Medicaid beneficiaries also would be affected. The Congressional Budget Office analysis of the AHCA estimated that 14 million fewer people would have Medicaid coverage as a result of the federal funding cuts. Many of them would be forced to look to the individual insurance market to gain coverage, yet half of these former Medicaid beneficiaries would have serious preexisting conditions. Given the historically very high costs for consumers associated with high-risk pools, the majority of these individuals would likely go uninsured instead. Many would end up using the emergency room to access care once their needs become urgent, and their uncompensated health care costs would be borne by others with insurance. Some would likely suffer serious health consequences, even preventable deaths.

Supporters of the AHCA suggest that the legislation gives states more options to design coverage for their citizens, thereby better meeting their needs. Section 1332 of the ACA, however, already gives states a great deal of flexibility in designing their marketplaces while still providing comprehensive and affordable coverage. Indeed, both Alaska and Minnesota are pursuing 1332 waiver programs to specifically address concerns about high-risk individuals by implementing reinsurance programs, rather than segregating people with preexisting conditions into high-risk pools. These programs would maintain the overall larger pool of insured people in the state while protecting insurers against catastrophic costs. Reinsurance programs, such as the one temporarily instituted under the ACA for its first three years, have historically been proven to bring down premium costs for everyone. Given that reinsurance programs are a more effective and evidence-based mechanism for stabilizing the individual insurance market, state policymakers should strongly consider pursuing these programs under the existing ACA rules instead of establishing high-risk pools. And, federal policymakers should acknowledge and support this mechanism to strengthen the marketplace, bring down costs, and encourage participation by insurers.

 

Senate’s Updated ACA Repeal-and-Replace Bill Will Still Leave Millions Uninsured

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http://www.commonwealthfund.org/publications/blog/2017/jul/senate-updated-aca-repeal-and-replace-bill?omnicid=EALERT1242189&mid=henrykotula@yahoo.com

Yesterday, Senate Republicans introduced an updated version of the Better Care Reconciliation Act (BCRA), their proposed repeal and replacement of the Affordable Care Act (ACA). The revised bill makes changes aimed at winning over Republicans who oppose the bill.

The Congressional Budget Office (CBO) projections of the updated bill’s effects on coverage and the federal budget are not available yet, but it is still likely to significantly increase the number of uninsured Americans — and raise health care spending for low- and moderate-income people. While the updated bill would leave the ACA’s taxes on higher-income people in place, providing an estimated $231 billion in additional revenue over the original bill, Senate Republicans do not propose using the funds to significantly increase the affordability of coverage for low- and moderate-income Americans. And the new version of the BCRA still dramatically cuts and reconfigures the Medicaid program.

The revised bill leaves the original BCRA’s provisions intact, including a phase-out of the ACA Medicaid expansion starting in 2020 and smaller premium tax credits compared to the ACA that make coverage less affordable for low-income people. (For a more complete overview of provisions, see our original post on the CBO score for the bill.)

The CBO estimated in June that the combined effects of these provisions would increase the number of people without health insurance by 22 million by 2026. The coverage losses would be borne disproportionately by people with low and moderate incomes and particularly older adults who purchase their own coverage. The revised bill is unlikely to change those fundamental outcomes.

One of the biggest criticisms of the BCRA is that it would roll back the coverage expansions under the ACA aimed at lower- and moderate-income Americans and give the savings to higher-income people by repealing two taxes that helped fund the expansions. The bill responds to that criticism only by keeping those taxes in place; it doesn’t use the proceeds to make coverage more affordable for less economically privileged Americans.

New Tax Revenue Used for Small Changes

Instead, the bill uses some of that extra revenue to allow people to use health savings accounts (HSAs) to buy health insurance. But HSAs are pre-tax savings accounts whose tax benefits increase with income. Moreover, people with low and moderate incomes are unlikely to have the excess income required to finance an HSA in the first place. This means the tax benefits from this change would flow to higher-income Americans.

The bill provides about $70 billion in new funds for states to reduce premiums through mechanisms like reinsurance. And while this money would certainly help stabilize markets, it’s not enough to make coverage sufficiently affordable for the 22 million people projected to lose health insurance under the BCRA. Moreover, the full amount of the increase appears to be transferred for use in an amendment to the bill, described below.

Similarly the $45 billion proposed in the revised bill for opioid treatment wouldn’t come close to meeting the full health care needs of an estimated 220,000 people with opioid use disorder who are at risk of losing their coverage through the ACA’s Medicaid expansion and the marketplaces.

More Underinsured and Damage to the Individual Market

Another major criticism of the BCRA is that it would significantly increase deductibles and copayments in the individual market. But rather than improving cost-protection, the new bill doubles down by making it possible for people to use premium tax credits to buy even skimpier, catastrophic coverage. While this will result in cheaper plans for healthy people, it would only serve to increase the number of Americans who are underinsured. Yet, because the bill doesn’t make the BCRA’s premium tax credits more generous, it is hard to see how insurance with deductibles that could consume the majority of a low-income family’s income will entice more people to buy it.

But even if there are small gains in coverage under the revised bill, they would likely be more than offset by the damage inflicted on the individual market through an amendment modeled on one by Senator Cruz. By letting states allow insurers to sell ACA-noncompliant policies, the amendment would split the individual market into two pools — one with healthy risks and one with sicker risks. As the insurance industry has already pointed out, this would create the conditions necessary for a true premium death spiral in the individual market, and widespread losses of insurance. To combat this, the amendment appears to borrow the $70 billion in new funds for market stabilization in the revised bill to help states that opted to do this reduce premiums. But based on the U.S. experience with high-risk pools, the funds would likely fall well short of what would be required.

Looking Forward

The ACA has led to millions of people gaining health insurance, many for the first time in their lives. National survey data indicate that this expanded coverage has triggered population-wide declines in cost-related problems getting needed care and reports of problems paying medical bills. But the nation is nowhere near achieving high-quality health care that is affordable for all Americans. In proposing bills that would reverse the small but significant improvements realized so far under the ACA, Senate and House Republicans will only push a better health care system further beyond our reach.

The massive Senate GOP shift on pre-existing conditions

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https://www.axios.com/the-massive-senate-gop-shift-on-pre-existing-conditions-2458798705.html

Image result for pre existing conditions

Over the past several weeks, senior GOP aides have repeatedly said that if the Senate bill touches pre-existing conditions in any way, it will lose around a third of the caucus. Today, a provision that could cause sick people to pay much higher premiums than they currently do has not caused any Republicans to say they’ll vote against the GOP health bill.

  • When Senate GOP leaders first presented their plan to the caucus in a PowerPoint presentation, it explicitly said that pre-existing conditions wouldn’t be touched, aides say.
  • As recently as two weeks ago, aides said members were surprised and angry to learn that Sen. Ted Cruz’s Consumer Freedom Option would allow plans that didn’t include the Affordable Care Act’s pre-existing conditions protections. (They could only be sold by insurers that also offered plans with the protections.)
  • Sen. Bob Corker: “I think people understand that’s got to be protected, and people understand what happened when the House dealt with it and opened it up, and it’s just not something that senators are wishing to do.”
  • Sen. Shelley Moore Capito over recess: “I think that reopens an issue that I can’t support, that it would make it too difficult for people with pre-existing conditions to get coverage.”
  • Sen. Chuck Grassley last week: “There’s a real feeling that that’s subterfuge to get around pre-existing conditions.”

Now, that resistance is “melting away,” as one Senate Republican aide put it today. “No one wants to be bad guy.”

Indeed, almost seven hours after the revised bill — including the Cruz provision — had been released, no Republican senator had threatened to vote against the bill unless the provision is removed. In fact, Republicans had surprisingly little to say about it.

What the Consumer Freedom Option does: 

  • It allows insurers that offer ACA-compliant plans to also sell plans that do not comply with ACA regulations, including the law’s essential health benefits and its pre-existing conditions protections.
  • Advocates of the bill say that while this could sort sick and healthy people into two different marketplaces, causing premiums to skyrocket for sick people, they’ll be insulated from these costs by premium subsidies and the bill’s stabilization fund.
  • Members “don’t realize we are basically creating single payer for sick people,” the GOP aide told me, saying that Republicans’ support is growing because people with pre-existing conditions can still get exchange plans.
  • The problem: “If there were hearings, everyone would have a lot more information about Cruz. Right now, Cruz is the only seller of the amendment and he’s the only one with information about the amendment,” said one well-connected GOP lobbyist, who said Cruz’s sales pitch seems to be convincing members to support his idea.
What insurers and experts are saying: 
  • America’s Health Insurance Plans: “Patients with pre-existing conditions … would potentially lose access to comprehensive coverage and/or have plans that were far more expensive.”
  • Scott Serota, president and CEO of the Blue Cross Blue Shield Association: “The ‘Consumer Freedom Option’ is unworkable as it would undermine pre-existing condition protections, increase premiums and destabilize the market.”
  • Kaiser Family Foundation: 1.5 million people with pre-existing conditions could have higher premiums under the Cruz amendment.
Yes, but: The conservative groups love it, as it addresses the ACA regulations that weren’t fully addressed in the previous version of the bill. They believe those regulations are driving up the cost of insurance. Stripping the provision could lose these groups’ support.

And Michael Cannon of the libertarian Cato Institute says the provision “would make access to healthcare more secure for patients who develop expensive conditions” — because it would free insurers to introduce a wider variety of health plans and make them less likely to leave the markets.