Tag Archives: Health Insurance Coverage Adequacy

Obamacare 101: Is there a smaller fix for the Affordable Care Act?

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , • Leave a comment

http://www.latimes.com/politics/la-na-pol-obamacare-101-marketplace-fixes-20170712-story.html?utm_campaign=KHN%3A%20First%20Edition&utm_source=hs_email&utm_medium=email&utm_content=54139610&_hsenc=p2ANqtz-_oK9ym4MAYbgjGTqJrtwWnYS7JczHHbl_O85RanUGaeiUnTcx9hvcqv7rFbgtEigUowQiiD8dTN5J0Reyhnc3D456E0Q&_hsmi=54139610

Image result for aca limited fix

With Senate Republicans struggling to find votes for sweeping legislation to roll back the Affordable Care Act, several GOP lawmakers have raised the prospect of a more limited bill — passed with help from Democrats — to stabilize health insurance markets around the country.

That may be heresy for conservative Republicans who’ve spent seven years demanding the full repeal of Obamacare, as the law is often called.

But most patient advocates, physician groups, hospitals and even many health insurers say more-targeted fixes to insurance marketplaces make more sense than the kind of far-reaching overhaul of government health programs that Republicans have been discussing.

Why do a more limited Obamacare ‘fix’?

For one thing, it would be politically easier. More-targeted legislation also wouldn’t threaten insurance protections for tens of millions of Americans.

The political debate over the 2010 healthcare law has focused for years on what has been happening to insurance marketplaces like HealthCare.gov, which were created by the law for Americans who don’t get health insurance through work.

For a variety of reasons, the marketplaces’ first several years have been rocky.

Insurers in many states struggled to figure out how much to charge for their plans and then raised premiums substantially when customers turned out to be sicker than they expected.

And as uncertainty over the future of the markets has intensified since President Trump’s election last year, several leading national insurers have decided to stop selling plans in some states, leaving consumers in some places with few if any health plans to choose from. Trump has called Obamacare a “disaster” and “dead.”

But the marketplaces — where about 10 million Americans currently get coverage — represent a very small fraction of the U.S. healthcare system.

By contrast, more than 70 million Americans rely on Medicaid and the related Children’s Health Insurance Plan, the government safety net plans for the poor.

Altering Medicaid, as proposed under the GOP plan, would be far more disruptive. And, as congressional Republicans are learning, it is much more controversial.

But isn’t Medicaid a big problem, too?

Many conservatives have long argued the federal government can’t afford to provide so much healthcare assistance to the poor.

But Medicaid has become a vital lifeline for tens of millions of Americans. Medicaid provides assistance to more than one in three U.S. children, protects millions of Americans with disabilities and is the largest funder of nursing home care for elderly Americans, in large part because Medicare does not cover nursing homes.

Obamacare’s Medicaid expansion, which made coverage available to working-age adults in many states, is credited with driving down the nation’s uninsured rate to the lowest levels ever recorded.

And a growing body of evidence shows it is improving low-income Americans’ access to needed medical care, reducing financial strains on families and improving health.

That is why Medicaid has been fiercely defended by patient groups, doctors, nurses, educators and even some Republican governors.

What would it take to stabilize insurance markets?

Probably not that much, actually.

There is widespread agreement that the federal government must first continue funding assistance through Obamacare to low-income consumers to help offset their co-pays and deductibles.

This aid — known as cost-sharing reduction, or CSR, payments – was included in the original law.

But the payments have become a political football as Republicans argued the aid can’t be provided without an appropriation by Congress. And Trump administration officials keep threatening to cut off the payments.

Many insurers say that would be devastating, forcing them to raise premiums by double digits.

Congress could simply put an end to that uncertainty by voting to appropriate the CSR money.

Secondly, most insurance industry officials and independent experts say the federal government must create a better system to protect insurers from big losses if they are hit with very costly patients.

Such reinsurance systems are used in other insurance marketplaces such as the Medicare Part D prescription drug program and are seen as critical to stabilizing markets.

Thirdly, current and former marketplace officials say, the federal government should aggressively market and advertise to get younger, healthier people to buy health plans on the marketplaces.

This strategy has helped Covered California, that state’s marketplace, which has not been beset by some of the problems in other markets.

Finally, many experts say, federal officials likely will have to come up with additional incentives to convince health insurers to offer plans in remote, rural areas.

Some Republicans have suggested that consumers in these areas could be allowed to buy health plans that don’t meet standards set out in the current law.

Would these steps cost more money?

Yes.

But both the House and Senate GOP bills to roll back Obamacare included billions of dollars to stabilize markets over the next several years.

So could Congress put that aid in a smaller healthcare bill?

That’s still unclear.

Many congressional Republicans are reluctant to spend any more money on healthcare aid, especially for a law that most have sworn to repeal.

But polls indicate that Americans now hold congressional Republicans and the Trump administration responsible for the fate of the nation’s healthcare system, including the insurance marketplaces.

That suggests that there could be a political price to pay for the GOP if the markets are not stabilized.

At the same time, Senate Democrats have signaled a willingness to work with Republicans on marketplaces fixes if GOP lawmakers agree to drop their repeal campaign.

But major hurdles remain, including demands from many GOP lawmakers that at least some of Obamacare’s provisions be repealed, such as the highly unpopular mandate requiring Americans to have health insurance.

Rather than stabilizing markets, however, eliminating the insurance requirement could lead to even more turmoil, experts say.

AHCA could mean 725K fewer healthcare jobs by 2026

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , , • Leave a comment

http://www.healthcaredive.com/news/ahca-could-mean-725k-fewer-healthcare-jobs-by-2026/445131/

Image result for fewer jobs

Dive Brief:

  • The American Health Care Act (AHCA), as it was passed in the House, would result in the loss of 924,000 jobs over 10 years and spark economic downturns in every state, according to research by the George Washington University Milken Institute School of Public Health and The Commonwealth Fund.
  • The healthcare sector would be hit the hardest, with 725,000 jobs lost by 2026. There would be fewer healthcare jobs immediately in 17 states. The states that would be most affected overall include New York, Pennsylvania and Florida.
  • The primary cause of the job disappearances and state economic downturns would be cuts to healthcare funding, such as more than $800 billion to Medicaid, and lower premium subsidies.

Dive Insight:

The analysis is of the House version of the bill, and the Senate is expected to make changes when it brings its own version up for a vote. But with those negotiations going on behind closed doors, there is not enough information to makes estimates based on the Senate bill.

The report is a warning call to the healthcare industry and another black mark on the increasingly unpopular AHCA. The bill is already opposed by most major industry groups. They balk at the huge cuts to Medicaid and the Congressional Budget Office estimates up to 23 million people would lose coverage.

The threat of jobs losses could become another rallying cry. In fact, healthcare executives shaken by the potential for repeal of the Affordable Care Act (ACA) are already scaling back hiring and new projects in the face of uncertainty. Former CMS Administrator Andy Slavitt said a poll he conducted found nearly 40% of executives said they are slowing hiring and 31% are cutting capital expenses.

Healthcare job growth spiked after the passage of the ACA, which the AHCA seeks to replace. The ACA helped create about 240,000 jobs in the industry, and employment increased from an average of 1.7% in 2010 to 2.5% from 2014 to 2016. But that trend has tempered. Healthcare has averaged 22,000 job gains a month so far this year. The average monthly gain in 2016 was 32,000.

The AHCA phases out Medicaid expansion, which has been an economic boon for states that decided to expand. The authors of the latest report said those states would be hit hardest in financial terms by the bill.

“Hospitals, health systems, clinics and pharmacies might be forced to close or lay off staff as federal funding for healthcare is cut and the number of uninsured patients grows,” the researchers wrote.

GOP promises lower health premiums but ignores all that’s driving them

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , , , , • Leave a comment

http://www.politico.com/story/2017/07/06/health-care-premiums-republicans-obamacare-240242

Image result for underinsured

Republicans promise to bring down the cost of health insurance for millions of Americans by repealing Obamacare.

But in the race to make insurance premiums cheaper, they ignore a more ominous number — the $3.2 trillion-plus the U.S. spends annually on health care overall.

Republicans are betting it’s smart politics to zoom in on the pocketbook issues affecting individual consumers and families. But by ignoring the mounting expenses of prescription drugs, doctor visits and hospital stays, they allow the health care system to continue on its dangerous upward trajectory.

That means that even if they fulfill their seven-year vow to repeal Obamacare and rein in premiums for some people,the nation’s mounting costs are almost sure to pop out in other places — includingfresh efforts by insurers and employers to push more expenses onto consumers through bigger out-of-pocket costs and narrower benefits.

As a presidential candidate, Donald Trump didn’t talk much about health care in 2016 — not compared to the border wall, jobs, or Hillary Clinton’s emails. But the final days of the campaign coincided with the start of the Obamacare sign-up season — and Trump leapt to attack what he called “60, 70, 80, 90 percent” premium increases. Big spikes did occur in some places, but they weren’t the rule, and most Obamacare customers got subsidies to defray the cost.

But the skyrocketing premium made a good closing message for Trump — and Republicans have stuck with it.

“The Republicans decoded: What is the single, 10-second thing that says why you are running against the Affordable Care Act?” said Bob Blendon, an expert on health politics at the Harvard T.H. Chan School of Public Health. “Premiums became the face of what’s wrong.”

The GOP approach differs from the tack Democrats took when they pushed for the Affordable Care Act back in 2009-10. That debate was about covering more Americans — and about “bending the curve” of national health care spending, which eats up an unhealthy portion of the economy.

Conservatives like Sen. Ted Cruz of Texas argue that Obamacare failed to achieve its promise to bring down costs.

“The biggest reason that millions of people are unhappy with Obamacare is it’s made premiums skyrocket,” said Cruz, who is leading a small band of conservatives trying to pull the Senate repeal bill to the right as leaders seek to cobble together 50 votes. “We’ve got to fix that problem that was created by the failing policies of Obamacare.”

The answer, he says, is getting government out of the way. Conservatives want to free insurers from many of the coverage requirements and consumer protections in Obamacare. That means they could sell plans that wouldn’t cover as comprehensive a set of benefits — but they’d be cheaper.

Even some prominent critics of the Affordable Care Act think that’s not getting at the heart of the U.S. health care problem, even if it sounds good to voters.

“Too many in the GOP confuse adjustments in how insurance premiums are regulated with bringing competitive pressures to bear on the costs of medical services,” the American Enterprise Institute’s James Capretta wrote in a recent commentary for Real Clear Health. “They say they want lower premiums for consumers, but their supposed solution would simply shift premium payments from one set of consumers to another.”

The Congressional Budget Office has not yet evaluated how the House repeal bill, which narrowly passed, or the Senate companion legislation, which is still being negotiated, would affect overall health spending in coming years. It is already a sixth of the U.S. economy — more than 17 cents out of every dollar — and spending is still growing, partly because of an aging population.

The nonpartisan budget office projected the federal government would spend about $800 billion less on Medicaid over a decade, as the GOP legislation upends how Washington traditionally paid its share. But CBO hasn’t yet reported on how that would affect the health sector overall.

Many Republicans predict that limiting federal payments to states would force Medicaid to be more efficient. Democrats says the GOP bill would basically thrust those costs onto the states and onto Medicaid beneficiaries themselves, who are too poor, by definition, to get their care — often including nursing homes — without government assistance.

The CBO gave a mixed assessment of what would happen to premiums under the GOP proposals. They’d rise before they’d fall — and they wouldn’t fall for everyone. Older and sicker people could well end up paying more, and government subsidies would be smaller, meaning that even if the sticker price of insurance comes down, many people at the lower end of the income scale wouldn’t be able to afford it.

“Despite being eligible for premium tax credits, few low-income people would purchase any plan,” the CBO said.

Shrinking insurance benefits may work out fine for someone who never gets injured or sick. But there are no guarantees of perpetual good health; that’s why insurance exists. If someone needs medical treatment not covered in their slimmed-down health plan, the costs could be astronomical and the treatment unobtainable.

Couple that with skimpier benefits, bigger deductibles, smaller subsidies and weaker patient protections, and “Trumpcare” — or whatever an Obamacare successor ends up being called — could spell voter backlash in the not-too-distant future, particularly as poll after poll shows the legislation is already deeply unpopular.

“Premiums are one of the important ways in which consumers experience cost. But it’s not the only way,” said David Blumenthal, president of the Commonwealth Fund, a liberal-leaning think tank, and a former Obama administration official. But deductibles running into the thousands of dollars and steep out-of-pocket costs, he added, “are a source of discontent for Trump and non-Trump voters alike.”

Even the 2009 health debate early in the Obama presidency, which looked at staggering national health spending and what it meant for the U.S. economy, didn’t translate into a bottom line for many American families, said Drew Altman, president and CEO of the Kaiser Family Foundation, which has extensively polled public attitudes on health care.

And the bottom line — the cost of care — is what ordinary people focus on, Kaiser has found. Not just on premiums, but on what it costs to see a doctor, to fill a prescription, or to get treated for a serious disease.

“That’s what all of our polling shows,” Altman said. “The big concern is health care costs.”

Democrats have a long list of things they detest about the Republican repeal-and-replace legislation — and the lack of attention to overall health spending for the country and for individuals and families is right up there.

Sen. Ron Wyden (D-Ore.), the top Democrat on the Finance Committee, would like a bill that tackles cost — starting with rising drug prices. But this bill, he said, does nothing about health care costs.

“This really isn’t a health bill. This is a tax-cut bill,” he said. The repeal bills would kill hundreds of billions of dollars of taxes — many on the health care industry or wealthy people — that were included in Obamacare to finance coverage expansion, though the Senate is now considering keeping some of them to provide more generous subsidies.

Conservative policy experts acknowledge that premiums aren’t the whole story.

The overall cost and spending trajectory “is something we have to get to,” said Stanford University’s Lanhee Chen, who has advised Mitt Romney and other top Republicans. But for now, he said, premiums are a good first step.

The Hidden Costs to Patients of Insured Healthcare

Posted on by • Posted in Uncategorized • Tagged , , , , • Leave a comment

The Hidden Costs to Patients of Insured Healthcare

Providers of healthcare and their families occasionally find themselves consumers of costly medical services and only then realize the complexity of the system that laypersons must deal with on a routine basis. As a physician and father of a medical student who had a traumatic injury on the grounds of the hospital where he worked, I learned only too well the Byzantine nature of the insurance accounting and billing component of our healthcare system.

In the midst of seasonally cold weather in January, my son tripped on an uneven paved surface just outside the hospital where he was reporting for the first day of his assignment and landed with his left arm extended, because his right arm was carrying reference books, absorbing the impact on his left shoulder.  This was a most unexpected accidental event for a long distance runner who also worked out in the weight room regularly. Unable to move, he was carried to the emergency room where the student clerk became the first patient of the shift.  He was seen by the usual array of interns, junior and senior residents, fellows, and attending physicians who were able to establish the diagnosis of shoulder dislocation using an x-ray, achieve anesthesia, and reduce the separation. After a shoulder immobilizer was placed, he was on his way with opioid analgesics.  He later elected to have surgery to repair the structural damage and thereafter needed to sleep in a recliner for several weeks to avoid interference with healing. Regular physical therapy then began with a dozen or more sessions needed to achieve the targeted mobility. Interval follow up with the orthopedic surgeon was of course required as well.

By the end of the range of treatments, he had received a dizzying array of bills from the physicians who saw him, from the ER attending to the radiologist, orthopedist and anesthesiologist, the laboratory, the hospital for facilities usage, the outpatient surgery center, the pharmacy, and of course the physical therapist. Each was neatly submitted by a separate organization, the hospital, professional service corporations, the laboratory, and physical therapy offices. The overall total amount billed was almost $40,000, an amount that would have driven him into financial chaos without dual insurance coverage through his wife and our secondary insurance policy for this 25 year old dependent under one of the new stipulations of the Affordable Care Act.  Dealing with the payments, though greatly reduced from the initial bill, required a phenomenal amount of paperwork and repeated inquiries to providers and insurance companies, especially with respect to the secondary insurer. Under current law, secondary insurance providers cannot obtain the information they request from the primary insurer but require the insured to provide all original bills as well as statements of benefits provided from the primary insurer. This is a particularly time-consuming and unintended consequence of current healthcare law that places an undue documentation burden on care recipients.

A simple retelling of this tale of how a moment’s error was able to change a person’s life for months and incur a remarkable amount of debt should be ample evidence for anyone that insurance coverage for the young is absolutely necessary, despite the presumed invincibility of youth. It also conveys a sense of the enormous effort required in coming to grips with the insurance coverage and billing process.  Without a team approach and support of personnel skilled in these processes, he would never have been able to manage the reams of financial statements generated and the endless requests for additional copies of documents that had already been sent.

The practitioners of medicine in the U.S. are doing a great job of managing challenging problems. The system of healthcare, however, is badly broken. The costs of care are known by most to be consequential and on the rise. The costs in terms of the patient’s time spent addressing a mountain of paperwork submitted by a highly fragmented array of providers are less well understood.  We must not lose sight of either aspect in the process of repairing the system.

Who’s driving health care law – a free market or insurance companies?

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , , • Leave a comment

http://theconversation.com/republican-health-care-bills-defy-the-partys-own-ideology-80175?utm_medium=email&utm_campaign=Latest%20from%20The%20Conversation%20for%20July%201%202017%20-%2077496134&utm_content=Latest%20from%20The%20Conversation%20for%20July%201%202017%20-%2077496134+CID_7e419ab4ae6962d1afd6f9273e9cc417&utm_source=campaign_monitor_us&utm_term=Republican%20health%20care%20bills%20defy%20the%20partys%20own%20ideology

Image result for insurance company lobbyists health care reform

Does this make economic sense?

Republicans may be too timid or lack the votes to advance structural reform. And they may feel it necessary to prop up insurance companies struggling with the costs of insuring high-risk patients. That’s a fair calculation.

But are they ready to create a health care system that aids every group except the working poor? The wealthy will have their health care and their tax cuts. The middle classes will continue to enjoy expensive, generous insurance that’s indirectly funded through the tax code. And insurance companies will accept whatever assistance the government provides – from tax cuts to coverage penalty periods – to continue increasing their authority over the medical system.

That’s an arrangement that leaves out the very groups that are most desperate for health care reform: lower-income families and the working poor.

68% of Consumers Did Not Pay Patient Financial Responsibility

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , • Leave a comment

https://revcycleintelligence.com/news/68-of-consumers-did-not-pay-patient-financial-responsibility?elqTrackId=f58bd47466634010a6e670a643500477&elq=235b6caa09e94e4eb4db871c5d4f6292&elqaid=2897&elqat=1&elqCampaignId=2683

Two in three individuals did not fully pay their patient financial responsibility to hospitals in 2016, a study revealed

 

The number of consumers failing to pay full patient financial responsibility to hospitals increased 15 percentage points from 2015 to 2016, a study showed.

About 68 percent of patients with medical bills of $500 or less did not fully pay their patient financial responsibility to hospitals in 2016, according to a recent TransUnion Health study.

The proportion of individuals failing to pay off full medical bill balances increased from 53 percent in 2015 and 49 percent in 2014.

“There are many reasons why more patients are struggling to make their healthcare payments in full, the most prominent of which are higher deductibles and the increase in patient responsibility from 10% percent to 30 percent over the last few years,” stated Jonathan Wiik, TransUnion Principal for Healthcare Revenue Cycle Management. “This shift in healthcare payments has been taking place for well over a decade, but we are seeing more pronounced changes in how hospital bills are paid during just the last few years.”

• 63 percent of hospital medical bills were $500 or less between 2014 and 2016 and 68 percent of these bills were not paid in full by 2016

• 14 percent of hospital medical bills between 2014 and 2016 were $3,000 or more and hospitals did not receive full patient financial responsibility for 99 percent of the bills in 2016

• 10 percent of hospital medical bills were between $500 and $1,000 from 2014 to 2016 and patients did not pay the full balance on 86 percent of them in 2016

The TransUnion Health analysis confirmed that as patient out-of-pocket costs increase, hospital patient financial responsibility collection rates drop. A recent Crowe Horwath study also revealed that patient collection rates for accounts with balances exceeding $5,000 were four times lower than patient collection rates for accounts with low-deductible health plans.

For patient balances between $1,451 and $5,000, hospitals reported a 25.5 percent collection rate. In contrast, hospitals saw collection rates drop to just 10.2 percent for patient balances between $5,001 and $7,500.

Consequently, patients are more likely to partially pay hospitals for their financial responsibility. The TransUnion Health analysis showed that the proportion of individuals making partial payments toward their hospital medical bills rose from about 89 percent in 2015 to 77 percent in 2016.

Hospitals may see these patient collection trends continue, researchers stated. They projected the percentage of individuals neglecting to fully pay their patient financial responsibility to grow to 95 percent by 2020.

Researchers pointed to the popularity of high-deductible health plans as the primary driver of increased hospital patient collection challenges. In 2015, almost one-quarter of all workers belonged to a high-deductible health plan with a savings options versus just 8 percent in 2009, a 2016 Health Affairs blogpost stated.

The number of employees enrolled in high-deductible health plans is likely to increase, the blogpost continued. More than four of ten employers are considering offering only high-deductible health plans over the next three years.

Provider organizations continue to feel the pressure from increased patient financial responsibility under high-deductible health plans. About 72 percent of providers in a recent InstaMed survey cited patient financial responsibility and collection as their top healthcare revenue cycle management concerns in 2016.

The greatest challenge impacting healthcare revenue cycle management was the growth of patient financial responsibility with 29 percent of respondents, followed by cash flow issues with 21 percent, longer days in accounts receivable with 14 percent, and rise in bad medical debt due to insufficient patient collections with 8 percent.

With unpaid patient financial responsibility reducing hospital revenue, TransUnion Health researchers reported that hospitals wrote off about $35.7 billion as bad medical debt or charity care in 2015. Although overall uncompensated care costs declined in 2015, they added.

“Higher deductibles and the increase in patient responsibility are causing a decrease in patient payments to providers for patient care services rendered,” stated John Yount, TransUnion Vice President for Healthcare Products. “While uncompensated care has declined, it appears to be primarily due to the increased number of individuals with Medicaid and commercial insurance coverage.”

Explaining Medicaid’s Starring Role in the U.S. Health Debate

Posted on by • Posted in Uncategorized • Tagged , , , , , , , , , • Leave a comment

https://www.bloomberg.com/news/articles/2017-06-27/medicaid-s-starring-role-in-u-s-health-care-flap-quicktake-q-a

Image result for medicaid

The biggest single change called for by the Republican health-care bill that may be voted on by the U.S. Senate this week is its reduction in federal spending on Medicaid, the program for poor and disabled Americans. The bill is being championed by Majority Leader Mitch McConnell and backed by U.S. President Donald Trump as a way to “repeal and replace” the Affordable Care Act, also known as Obamacare. The Senate bill, like one passed in May by the House of Representatives, would roll back Obamacare’s expansion of Medicaid and make other far-reaching changes to the program as well.

1. Who does Medicaid serve?

It’s the biggest health insurer in the U.S., providing benefits to about one in fourAmericans. It covers almost half of all births, almost two-thirds of people in nursing homes, almost 40 percent of all children and almost a third of adults with disabilities. Total Medicaid spending was $552 billion in the 2015 fiscal year, 17 percent of overall health spending. Along with education, Medicaid is one of the two largest components of spending by state governments, which administer the program and fund it in partnership with the federal government.

2. How did Obamacare change Medicaid?

It expanded Medicaid to cover those who were unable to afford private insurance but didn’t have incomes low enough to qualify for Medicaid before. After a Supreme Court ruling made the expansion optional, 31 states and the District of Columbia used the financial incentives offered under the Obamacare law to add about 12 million people to the Medicaid rolls. To congressional Republicans’ ire, the expansion was funded in part by tax increases on higher-income people. The federal government pays more than 90 percent of the cost of the Medicaid expansion.

Reverse the expansion of Medicaid, at different paces. The House bill would wind down funding for the expansion starting in 2020. The Senate bill would phase out the expansion’s funding between 2021 and 2024.

4. How else would they change Medicaid?

Currently, the federal government generally reimburses states for a fixed percentage of Medicaid expenditures, regardless of total spending or number of people enrolled. The Republican bills would impose a per-person limit on Medicaid reimbursement that would increase over time at a rate linked to inflation. The Congressional Budget Office said that under the House bill, which uses the rate of medical inflation to set the pace of spending, federal Medicaid spending would decrease by $834 billion between 2017 and 2026. The Senate bill would set a lower growth rate starting in 2025 by using the general inflation rate as a benchmark for much of Medicaid’s spending, rather than the medical inflation rate.

5. What would the impact be?

The Congressional Budget Office estimates that between 2017 and 2026, 15 million fewer people would be covered by Medicaid under the Senate bill, and 14 million fewer under the House bill, than under Obamacare. In both cases, Medicaid would account for about two-thirds of the increase in the number of uninsured projected by the CBO.

6. How else could poor people get coverage?

The House and Senate bills would make them eligible for subsidies for individual insurance policies, meaning people who are dropped from Medicaid could use the subsidies to buy their own coverage. Critics say the bill would make those policies unaffordable to low-income people by increasing deductibles.

7. What’s the debate about the bills like?

8. What’s Trump’s position?

During the 2016 campaign, Trump said that unlike other Republican candidates he would not cut Medicaid, Medicare or Social Security. But he did support the House health-care bill. After McConnell introduced a draft version of his bill, Sean Spicer, the White House spokesman, said that Trump was “very supportive” of the bill but was “committed” to making sure that people currently on Medicaid didn’t lose their coverage.

Why the Senate’s health-care plan wouldn’t work in the real world

Posted on by • Posted in Uncategorized • Tagged , , , , , • Leave a comment

https://www.washingtonpost.com/opinions/the-senates-stingy-health-care-plan-is-completely-divorced-from-reality/2017/06/27/d50fa164-5aae-11e7-a9f6-7c3296387341_story.html?_hsenc=p2ANqtz-9M5TlH1CkHMS9b8NuaAZIr70MtnByP5VmFyCRl2GE12CC9rpCkE66FP8pFIQJvugV2CytbTixxMp7Q9JTFfA8qxd1GpQ&_hsmi=53644856&hsCtaTracking=5f450823-63e0-4d25-b2ce-70533ca2b9d4%7C3f79eca7-20b3-466d-96aa-8cbac1d74e55&utm_campaign=KFF-2017-Drew-WPost-6.27.17-Senatereality&utm_content=53644856&utm_medium=email&utm_source=hs_email&utm_term=.b0a9f1bf75df

Image result for drew altman

Drew Altman is president and chief executive of the Henry J. Kaiser Family Foundation.

Monday’s report on the Senate health-care bill from the Congressional Budget Office said that 22 million people would lose coverage under the plan and that coverage in the non-group market would become far stingier than it is today. By Tuesday the bill had been pulled back for revision. The quick sequence was revealing: Senators clearly could use some extra time to figure out how to bridge a giant gap between policy theory and reality.

The CBO report illustrates how policymaking can become divorced from the reality of people’s lives. Here are three big examples of how the Senate health-care bill, as currently configured, may sound one way in theory (and in talking points) but would work out quite another way in practice.

First, the bill phases out the Affordable Care Act’s 90 percent federal match for expanded Medicaid eligibility over four years, reducing it to each state’s regular matching rate. The theory is that this phase-down period would provide time for states to decide whether they want to replace the lost federal funds and continue their Medicaid expansions.

But consider these estimates of how much it would cost states to replace those federal funds: California would have to come up with $12.5 billion when the phase-down is fully implemented in 2024, a 400 percent increase; Ohio would need $1.6 billion, a 272 percent increase; Nevada, $343 million, a 243 percent increase; and West Virginia, $178 million, a 168 percent increase. The impact on the other expansion states would be similar.

There is no way states can replace funds of this magnitude. If the expansion states try to replace even a significant share of the money, they will be forced to increase taxes or make significant cuts to other parts of their budgets, including for public schools, higher education, environmental protection and corrections. And because the federal match would be phased out incrementally beginning in the first year, states would have every incentive to end or freeze their expansions quickly. The idea that a phaseout would give states time to plan and adjust is driven by a belief that states can operate Medicaid with far less money if they have greater flexibility. In this case, with funding cuts this large, it’s simply wishful thinking.

That leads to reality gap No. 2: the theory that the 14 million people who are covered under the ACA’s Medicaid expansion could buy private coverage with the tax credits offered under the Republican plan, in effect privatizing the Medicaid expansion. This is the biggest reality check in the Senate bill.

Let’s look at a typical adult covered by the Medicaid expansion. He is a 35-year-old man who lives in, say, Minden, Nev., makes $15,000 a year and may even have voted for President Trump. Under the Senate plan, he could buy a policy costing him about $400 per year after using his tax credit, but his plan would come with a deductible of more than $6,000 a year. (The Senate plan’s policies are calibrated to cover just 58 percent of costs.) On a $15,000 income, he cannot afford to get sick with a policy like that. Assuming he has a car to get to work, pays rent, eats food and otherwise has the same basic expenses as any other human being, such a policy would be far from affordable for him. In fact, this is why this hypothetical Trump voter was uninsured before Medicaid was expanded in his state; like millions of his counterparts across the country, he could not afford private coverage.

The Senate plan also trims back the pool of people in the non-group market who will be eligible for tax credits, by reducing the threshold from four to 3½ times the federal poverty line. That leads to reality gap No. 3. Consider a 60-year-old woman in the town of Strong, Maine, making just less than $45,000 a year. She has high blood pressure, takes daily medication and needs regular monitoring because of her previous thyroid cancer. Under the ACA, she is eligible for a premium tax credit of about $7,000 and a comprehensive policy with a premium cost to her of about $4,500 in 2020, when the Senate health-care bill would take effect. Under the Senate plan, she would not be eligible for a tax credit. A similar plan under the Senate bill would cost her more than $15,000, or one-third of her income.

Gaps between the theory and practice of policy are not some Republican creation. Under the ACA, many people have struggled with costs or were forced to change plans and provider networks annually to keep their premiums down. But the current Senate bill takes this divergence to a new level. Private insurance cannot be better than Medicaid if it is unaffordable; states do not have some magic way to cover millions of people with far less money.

The bill may now be altered, and senators will certainly hear from constituents over the holiday recess. They should listen carefully to what they have to say. As it’s written, the Senate health-care plan would substantially widen the gap between policy theory and the real world — making coverage unaffordable for millions more Americans.

H.R. 1628, Better Care Reconciliation Act of 2017

Posted on by • Posted in Uncategorized • Tagged , , , , , , • Leave a comment

https://www.cbo.gov/publication/52849

Click to access 52849-hr1628senate.pdf

The Congressional Budget Office and the staff of the Joint Committee on Taxation (JCT) have completed an estimate of the direct spending and revenue effects of the Better Care Reconciliation Act of 2017, a Senate amendment in the nature of a substitute to H.R. 1628. CBO and JCT estimate that enacting this legislation would reduce the cumulative federal deficit over the 2017-2026 period by $321 billion. That amount is $202 billion more than the estimated net savings for the version of H.R. 1628 that was passed by the House of Representatives.

The Senate bill would increase the number of people who are uninsured by 22 million in 2026 relative to the number under current law, slightly fewer than the increase in the number of uninsured estimated for the House-passed legislation. By 2026, an estimated 49 million people would be uninsured, compared with 28 million who would lack insurance that year under current law.

Following the overview, this document provides details about the major provisions of this legislation, the estimated costs to the federal government, the basis for the estimate, and other related information, including a comparison with CBO’s estimate for the House-passed act.

Effects on the Federal Budget

CBO and JCT estimate that, over the 2017-2026 period, enacting this legislation would reduce direct spending by $1,022 billion and reduce revenues by $701 billion, for a net reduction of $321 billion in the deficit over that period (see Table 1, at the end of this document):

  • The largest savings would come from reductions in outlays for Medicaid—spending on the program would decline in 2026 by 26 percent in comparison with what CBO projects under current law—and from changes to the Affordable Care Act’s (ACA’s) subsidies for nongroup health insurance (see Figure 1). Those savings would be partially offset by the effects of other changes to the ACA’s provisions dealing with insurance coverage: additional spending designed to reduce premiums and a reduction in revenues from repealing penalties on employers who do not offer insurance and on people who do not purchase insurance.
  • The largest increases in deficits would come from repealing or modifying tax provisions in the ACA that are not directly related to health insurance coverage, including repealing a surtax on net investment income and repealing annual fees imposed on health insurers.

Pay-as-you-go procedures apply because enacting this legislation would affect direct spending and revenues. CBO and JCT estimate that enactment would not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2027. The agencies expect that savings, particularly from Medicaid, would continue to grow, while the costs would be smaller because a rescinded tax on employees’ health insurance premiums and health plan benefits would be reinstated in 2026. CBO has not completed an estimate of the potential impact of this legislation on discretionary spending, which would be subject to future appropriation action.

Effects on Health Insurance Coverage

CBO and JCT estimate that, in 2018, 15 million more people would be uninsured under this legislation than under current law—primarily because the penalty for not having insurance would be eliminated. The increase in the number of uninsured people relative to the number projected under current law would reach 19 million in 2020 and 22 million in 2026. In later years, other changes in the legislation—lower spending on Medicaid and substantially smaller average subsidies for coverage in the nongroup market—would also lead to increases in the number of people without health insurance. By 2026, among people under age 65, enrollment in Medicaid would fall by about 16 percent and an estimated 49 million people would be uninsured, compared with 28 million who would lack insurance that year under current law.

Stability of the Health Insurance Market

Decisions about offering and purchasing health insurance depend on the stability of the health insurance market—that is, on the proportion of people living in areas with participating insurers and on the likelihood of premiums’ not rising in an unsustainable spiral. The market for insurance purchased individually with premiums not based on one’s health status would be unstable if, for example, the people who wanted to buy coverage at any offered price would have average health care expenditures so high that offering the insurance would be unprofitable.

Under Current Law. Although premiums have been rising under current law, most subsidized enrollees purchasing health insurance coverage in the nongroup market are largely insulated from increases in premiums because their out-of-pocket payments for premiums are based on a percentage of their income; the government pays the difference between that percentage and the premiums for a reference plan (which is the second-lowest-cost plan in their area providing specified benefits). The subsidies to purchase coverage, combined with the effects of the individual mandate, which requires most individuals to obtain insurance or pay a penalty, are anticipated to cause sufficient demand for insurance by enough people, including people with low health care expenditures, for the market to be stable in most areas.

Nevertheless, a small number of people live in areas of the country that have limited participation by insurers in the nongroup market under current law. Several factors may lead insurers to withdraw from the market—including lack of profitability and substantial uncertainty about enforcement of the individual mandate and about future payments of the cost-sharing subsidies to reduce out-of-pocket payments for people who enroll in nongroup coverage through the marketplaces established by the ACA.

Under This Legislation. CBO and JCT anticipate that, under this legislation, nongroup insurance markets would continue to be stable in most parts of the country. Although substantial uncertainty about the effects of the new law could lead some insurers to withdraw from or not enter the nongroup market in some states, several factors would bring about market stability in most states before 2020. In the agencies’ view, those key factors include the following: subsidies to purchase insurance, which would maintain sufficient demand for insurance by people with low health care expenditures; the appropriation of funds for cost-sharing subsidies, which would provide certainty about the availability of those funds; and additional federal funding provided to states and insurers, which would lower premiums by reducing the costs to insurers of people with high health care expenditures.

The agencies expect that the nongroup market in most areas of the country would continue to be stable in 2020 and later years as well, including in some states that obtain waivers that would not have otherwise done so. (Under current law and this legislation, states can apply for Section 1332 waivers to change the structure of subsidies for nongroup coverage; the specifications for essential health benefits [EHBs], which set the minimum standards for the benefits that insurance in the nongroup and small-group markets must cover; and other related provisions of law.) Substantial federal funding to directly reduce premiums would be available through 2021. Premium tax credits would continue to provide insulation from changes in premiums through 2021 and in later years. Those factors would help attract enough relatively healthy people for the market in most areas of the country to be stable, CBO and JCT anticipate. That stability in most areas would occur even though the premium tax credits would be smaller in most cases than under current law and subsidies to reduce cost sharing—the amount that consumers are required to pay out of pocket when they use health care services—would be eliminated starting in 2020.

In the agencies’ assessment, a small fraction of the population resides in areas in which—because of this legislation, at least for some of the years after 2019—no insurers would participate in the nongroup market or insurance would be offered only with very high premiums. Some sparsely populated areas might have no nongroup insurance offered because the reductions in subsidies would lead fewer people to decide to purchase insurance—and markets with few purchasers are less profitable for insurers. Insurance covering certain services would become more expensive—in some cases, extremely expensive—in some areas because the scope of the EHBs would be narrowed through waivers affecting close to half the population, CBO and JCT expect. In addition, the agencies anticipate that all insurance in the nongroup market would become very expensive for at least a short period of time for a small fraction of the population residing in areas in which states’ implementation of waivers with major changes caused market disruption.

Effects on Premiums and Out-of-Pocket Payments

The legislation would increase average premiums in the nongroup market prior to 2020 and lower average premiums thereafter, relative to projections under current law, CBO and JCT estimate. To arrive at those estimates, the agencies examined how the legislation would affect the premiums charged if people purchased a benchmark plan in the nongroup market.

In 2018 and 2019, under current law and under the legislation, the benchmark plan has an actuarial value of 70 percent—that is, the insurance pays about 70 percent of the total cost of covered benefits, on average. In the marketplaces, such coverage is known as a silver plan.

Under the Senate bill, average premiums for benchmark plans for single individuals would be about 20 percent higher in 2018 than under current law, mainly because the penalty for not having insurance would be eliminated, inducing fewer comparatively healthy people to sign up. Those premiums would be about 10 percent higher than under current law in 2019—less than in 2018 in part because funding provided by the bill to reduce premiums would affect pricing and because changes in the limits on how premiums can vary by age would result in a larger number of younger people paying lower premiums to purchase policies.

In 2020, average premiums for benchmark plans for single individuals would be about 30 percent lower than under current law. A combination of factors would lead to that decrease—most important, the smaller share of benefits paid for by the benchmark plans and federal funds provided to directly reduce premiums.

That share of services covered by insurance would be smaller because the benchmark plan under this legislation would have an actuarial value of 58 percent beginning in 2020. That value is slightly below the actuarial value of 60 percent for “bronze” plans currently offered in the marketplaces. Because of the ACA’s limits on out-of-pocket spending and prohibitions on annual and lifetime limits on payments for services within the EHBs, all plans must pay for most of the cost of high-cost services. To design a plan with an actuarial value of 60 percent or less and pay for those high-cost services, insurers must set high deductibles—that is, the amounts that people pay out of pocket for most types of health care services before insurance makes any contribution. Under current law for a single policyholder in 2017, the average deductible (for medical and drug expenses combined) is about $6,000 for a bronze plan and $3,600 for a silver plan. CBO and JCT expect that the benchmark plans under this legislation would have high deductibles similar to those for the bronze plans offered under current law. Premiums for a plan with an actuarial value of 58 percent are lower than they are for a plan with an actuarial value of 70 percent (the value for the reference plan under current law) largely because the insurance pays for a smaller average share of health care costs.

Although the average benchmark premium directly affects the amount of premium tax credits and is a key element in CBO’s analysis of the budgetary effects of the bill, it does not represent the effect of this legislation on the average premiums for all plans purchased. The differences in the actuarial value of plans purchased under this legislation and under current law would be greater starting in 2020—when, for example, under this bill, some people would pay more than the benchmark premium to purchase a silver plan, whereas, under current law, others would pay less than the benchmark premium to purchase a bronze plan.

Under this legislation, starting in 2020, the premium for a silver plan would typically be a relatively high percentage of income for low-income people. The deductible for a plan with an actuarial value of 58 percent would be a significantly higher percentage of income—also making such a plan unattractive, but for a different reason. As a result, despite being eligible for premium tax credits, few low-income people would purchase any plan, CBO and JCT estimate.

By 2026, average premiums for benchmark plans for single individuals in most of the country under this legislation would be about 20 percent lower than under current law, CBO and JCT estimate—a smaller decrease than in 2020 largely because federal funding to reduce premiums would have lessened. The estimates for both of those years encompass effects in different areas of the country that would be substantially higher and substantially lower than the average effect nationally, in part because of the effects of state waivers. Some small fraction of the population is not included in those estimates. CBO and JCT expect that those people would be in states using waivers in such a way that no benchmark plan would be defined. Hence, a comparison of benchmark premiums is not possible in such areas.

Some people enrolled in nongroup insurance would experience substantial increases in what they would spend on health care even though benchmark premiums would decline, on average, in 2020 and later years. Because nongroup insurance would pay for a smaller average share of benefits under this legislation, most people purchasing it would have higher out-of-pocket spending on health care than under current law. Out-of-pocket spending would also be affected for the people—close to half the population, CBO and JCT expect—living in states modifying the EHBs using waivers. People who used services or benefits no longer included in the EHBs would experience substantial increases in supplemental premiums or out-of-pocket spending on health care, or would choose to forgo the services. Moreover, the ACA’s ban on annual and lifetime limits on covered benefits would no longer apply to health benefits not defined as essential in a state. As a result, for some benefits that might be removed from a state’s definition of EHBs but that might not be excluded from insurance coverage altogether, some enrollees could see large increases in out-of-pocket spending because annual or lifetime limits would be allowed.

Uncertainty Surrounding the Estimates

CBO and JCT have endeavored to develop budgetary estimates that are in the middle of the distribution of potential outcomes. Such estimates are inherently inexact because the ways in which federal agencies, states, insurers, employers, individuals, doctors, hospitals, and other affected parties would respond to the changes made by this legislation are all difficult to predict. In particular, predicting the overall effects of the myriad ways that states could implement waivers is especially difficult.

CBO and JCT’s projections under current law itself are also uncertain. For example, enrollment in the marketplaces under current law will probably be lower than was projected under the March 2016 baseline used in this analysis, which would tend to decrease the budgetary savings from this legislation. However, the average subsidy per enrollee under current law will probably be higher than was projected in March 2016, which would tend to increase the budgetary savings from this legislation. (For a related discussion, see the section on “Use of the March 2016 Baseline” on page 15.)

Despite the uncertainty, the direction of certain effects of this legislation is clear. For example, the amount of federal revenues collected and the amount of spending on Medicaid would almost surely both be lower than under current law. And the number of uninsured people under this legislation would almost surely be greater than under current law.

Intergovernmental and Private-Sector Mandates

CBO has reviewed the nontax provisions of the legislation and determined that they would impose intergovernmental mandates as defined in the Unfunded Mandates Reform Act (UMRA) by preempting state laws. Although the preemptions would limit the application of state laws, they would impose no duty on states that would result in additional spending or a loss of revenues. JCT has determined that the tax provisions of the legislation contain no intergovernmental mandates.

JCT and CBO have determined that the legislation would impose private-sector mandates as defined in UMRA. On the basis of information from JCT, CBO estimates that the aggregate cost of the mandates would exceed the annual threshold established in UMRA for private-sector mandates ($156 million in 2017, adjusted annually for inflation).

Does Health Insurance Save Lives?

Posted on by • Posted in Uncategorized • Tagged , , , , • Leave a comment

http://www.medpagetoday.com/PublicHealthPolicy/HealthPolicy/66276?isalert=1&uun=g885344d5576R7095614u&xid=NL_breakingnews_2017-06-26

Data from multiple sources all point to one answer.

With multiple bills, strained markets, and CBO scores all competing for the public’s attention in the healthcare debate, some researchers are examining a presumably simple question: Does health insurance save lives? A couple of recent papers, including a review appearing Monday in Annals of Internal Medicine, prompted MedPage Today clinical reviewer F. Perry Wilson, MD, to take a look at the available data and the statistical tools used to parse them.

You may have noticed that there’s a bit of a debate going on about health insurance in this country. Reflecting the great diversity of American political life, we have those calling for a universal, single-payer healthcare system:

But in the end, there’s one question that seems to really cut through the political debate: does health insurance save lives? Multiple groups are synthesizing decades worth of data to answer that question. Last week, we saw a report co-authored by Atul Gawande and appearing in the New England Journal of Medicine that concluded: