Tag Archives: Health Insurance Coverage Adequacy

Idaho Blue Cross Jumps Into Controversial Market For Plans That Bypass ACA Rules

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https://khn.org/news/idaho-blue-cross-jumps-into-controversial-market-for-plans-that-bypass-aca-rules/?utm_campaign=KFF-2018-The-Latest&utm_source=hs_email&utm_medium=email&utm_content=60750320&_hsenc=p2ANqtz-_fH8PLw8MQcK5-6PQpM5hnAT-lUReNyxbqcVv3CQftN_JErkzwdKT74g8pG-zb0KDTi4MLTSaD8zofdRUaejz_MhZWpw&_hsmi=60750320

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That didn’t take long.

It’s barely been two weeks since Idaho regulators said they would allow the sale of health insurance that does not meet all of the Affordable Care Act’s requirements — a controversial step some experts said would likely draw legal scrutiny and, potentially, federal fines for any insurer that jumped in.

On Wednesday, Blue Cross of Idaho unveiled a menu of new health plans that break with federal health law rules in several ways, including setting premiums based on applicants’ health.

“We’re trying to offer a choice that allows the middle class to get back into insurance coverage,” said Dave Jeppesen, the insurer’s executive vice president for consumer health care.

The firm filed five plans to the state for approval and hopes to start selling them as soon as next month.

The Blue Cross decision ups the ante for Alex Azar, the Trump administration’s new Health and Human Services secretary. Will he use his authority under federal law to compel Idaho to follow the ACA and reject the Blues plans? Or will he allow state regulators to move forward, perhaps prompting other states to take more sweeping actions?

At a congressional hearing Wednesday, even as Blue Cross rolled out its plans, Azar faced such questions.

“There are rules. There is a rule of law that we need to enforce,” Azar said. Observers noted, however, he did not specifically indicate whether the federal government would step in.

Robert Laszewski, a consultant and former insurance industry executive, thinks it should.

“If Idaho is able to do this, it will mean other … states will do the same thing,” he said. “If a state can ignore federal law on this, it can ignore federal law on everything.”

Idaho’s move stirs up more issues about individual insurance market stability.

Policy experts say that allowing lower-cost plans that don’t meet the ACA’s standards to become more widespread will pull younger and healthier people out of Obamacare, raising prices for those who remain. Supporters say that is already happening, so this simply provides more choices for people who earn too much to qualify for subsidies to help them purchase ACA coverage.

The state’s move to allow such plans, announced in January, drew harsh and swift criticism.

“Crazypants illegal,” tweeted Nicholas Bagley, a law professor at the University of Michigan and former attorney with the civil division of the U.S. Department of Justice, who said that states can’t pick and choose which parts of federal law to follow. Sabrina Corlette, a research professor at Georgetown University’s Center on Health Insurance Reforms, pointed out that health insurers could be liable for sharp fines if they are found to be in violation of the ACA.

But both Idaho regulators and Blue Cross officials say they are not worried.

Jeppesen said the ACA gives states regulatory authority “to make sure the market works and is stable,” and the insurer is simply “following what the state has given us guidance” to do.

Other insurers in Idaho are taking a much more cautious approach, telling The Wall Street Journal they are not stepping up immediately to offer their own plans.

Laszewski said they are likely waiting to see what legal challenges develop.

“If I were running an insurance company, there’s no way I would stick my neck out until the high court has ruled in favor of this — and they’re not going to,” he said.

Jeppesen said his company has consulted with legal experts and is moving ahead with confidence. The aim is to bring people back into the market, particularly the young, the healthy and those who don’t get a tax credit subsidy and can’t afford an ACA plan.

For some people — especially younger or healthier applicants — the new plans, which the insurer has named Freedom Blue, cost less per month than policies that meet all ACA rules.

They accomplish that by limiting coverage. If they are allowed to be sold, consumers will need to weigh the lower premiums against some of the coverage restrictions and variable premiums and deductibles, policy experts say.

The plans, for example, will include a “waiting period” of up to 12 months for any preexisting conditions if the applicant has been without coverage for more than 63 days, Jeppesen said.

Additionally, they cap total medical care coverage at $1 million annually. And premiums are based, in part, on a person’s health: The healthiest consumers get rates 50 percent below standard levels, while those deemed unhealthy would be charged 50 percent more.

All those caveats violate ACA rules, which forbid insurers from rejecting coverage of preexisting conditions or setting dollar caps on benefits or higher premiums for people with health problems.

But the rates may prove attractive to some.

Premiums for a healthy 45-year-old, for example, could be as low as $195 a month, according to a comparison issued by the insurer, while a 45-year-old with health problems could be charged $526. In that case, the 45-year old would find a lower price tag — $343 a month — for an ACA-compliant bronze plan.

While Freedom Blues plans cover many of the “essential health benefits” required under the ACA, such as hospitalization, emergency care and mental health treatment, they do not include pediatric dental or vision coverage. One of the five plans does not include maternity coverage.

When compared with one of the Blues’ ACA-compliant plans — called the Bronze 5500 — the new standard Freedom Blue plan’s annual deductibles are a mixed bag.

That’s because they have two separate deductibles — one for medical care and one for drugs. If a consumer took only generic drugs, the new plan would be less expensive, according to details provided by the plan. But with a $4,000 deductible for brand-name drugs, the Freedom Blue plan requires more upfront money before full coverage kicks in than the ACA-compliant plan it was compared with.

Jeppesen said the insurer hopes to attract many of the “110,000 uninsured state residents who cannot afford [ACA] coverage.”

That’s the total number of uninsured people who earn more than 100 percent of the federal poverty level in the state, he said.

Sarah Lueck, senior policy analyst for the Center on Budget and Policy Priorities, cautioned that some of those residents might actually be eligible for subsidies under the ACA, which are available to people earning up to four times as much.

“Many … could be getting subsidies for more comprehensive coverage through the [ACA-compliant state exchange] and would be better off,” Lueck said.

 

Trump budget seeks savings through ObamaCare repeal

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Trump budget seeks savings through ObamaCare repeal

Trump budget seeks savings through ObamaCare repeal

The White House budget for fiscal 2019 seeks major savings by repealing ObamaCare and endorsed a Senate GOP bill as the best way to do so.

“The Budget supports a two-part approach to repealing and replacing Obamacare, starting with enactment of legislation modeled closely after the Graham-Cassidy-Heller-Johnson (GCHJ) bill as soon as possible,” the White House said in its budget request.

The legislation from Sens. Lindsey Graham (R-S.C.), Bill Cassidy (R-La.), Ron Johnson (R-Wis.) and Dean Heller (R-Nev.) would replace ObamaCare with a series of block grants to states.

The budget proposes over $90 billion in savings over 10 years if the policies in the Graham-Cassidy bill were enacted. Combined with other provisions like Medicaid changes, the White House projects there would be nearly $675 billion in savings over a decade tied to repealing ObamaCare.

Advocacy groups were quick to denounce the proposal, which is unlikely to gain traction in Congress.

“By asking Congress to revive the deeply unpopular Graham-Cassidy repeal bill that ended protections for Americans with pre-existing conditions, gutted Medicaid, ripped away coverage from millions, and raised costs for millions more, while also proposing drastic cuts to Medicare, Trump has chosen to ignore the American public’s overwhelming preference for a bipartisan path forward on health care,” said Protect Our Care campaign director Brad Woodhouse.

Republican leaders have signaled that they are not interested in diving back into the contentious ObamaCare repeal fight this year. The Senate last year failed to pass a repeal bill, and there is no indication that the votes have shifted since then.

A number of Republicans have even discussed taking bipartisan actions to stabilize ObamaCare markets and try to bring down premiums through actions such as funding known as reinsurance.

Graham has said he will continue fighting for his bill and is not completely alone. Sen. Ted Cruz (R-Texas) is also calling for Congress to not give up on repeal this year.

 

Health Care Is a Universal Value. It’s Time for a Universal Effort.

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Health Care Is a Universal Value. It’s Time for a Universal Effort.

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California is the most diverse place on earth. You see that diversity in our people, our culture, and our landscape. Our differences are our strength – but only if we remember the things that bind us together and the values we all share.

The belief that everyone should have health care is one of those universal values. From the day we are born, health care gives people the opportunity to have full lives and the vitality to pursue their dreams. And no one should lack support when illness strikes.

Over the last year, the California Health Care Foundation (CHCF) has been re-examining the work we do, because we want to make sure our efforts and our dollars are making the greatest possible impact in light of what’s happening in the world around us. As we went through that process, one unavoidable truth remained as our top concern: Too many low-income Californians are held back or suffer because it is too hard to get the care they need. Our board of directors and CHCF’s deeply committed staff have decided that the foundation’s top priority should be to address that problem.

Certainly, this undertaking will not be easy, but the good news is that there are clear ways to make health care work for low-income Californians. Here are three that are top of mind for us now.

1. All Californians Should Have Health Coverage

California has made huge gains in recent years under the Affordable Care Act (ACA). We’ve cut our number of uninsured by half. Now we must finish the job and work to ensure everyone has health benefits.

Achieving universal coverage would level the playing field in two key ways. It would allow all Californians to meet basic needs for care, and it would protect all Californians financially from extraordinary health care expenses. Today, three million of our friends and neighbors remain uninsured. Most have jobs and are contributing to our economy and communities, but those jobs do not include health insurance. We must also remember that one in three uninsured Californians is an undocumented immigrant. These people are part of the fabric of California’s society; if we allow them to remain vulnerable, all of California will pay the price.

Never has California been so close to achieving universal coverage. There is no one pathway to get to that goal, but get there we must.

2. Coverage Must Lead to Better Care

Coverage is not an end in itself – it’s really just the gateway to better health. To deliver on this promise, coverage must lead to better care. Our biggest opportunity to improve care for low-income Californians is to make sure that California’s approach to coverage for low-income populations – the Medi-Cal program – delivers high-value care. The program covers one in three Californians. And two-thirds of Californians say Medi-Cal is important to them and their families. When we get Medi-Cal right, the impact is broad and deep because of the program’s overall reach and the profound ways in which it improves a person’s prospects for health.

In the last year, we have seen major new federal threats to Medicaid’s fiscal and policy stability. Given the importance of Medi-Cal to California, we must continue working together locally and with other states to protect Medicaid from ill-advised budget and policy changes.

But it isn’t enough for California to protect the status quo. There is so much potential for improvement in Medi-Cal, which serves Californians with the greatest health burdens. We must be diligent and vigilant in finding new ways to reduce the struggle of those who depend on the program and to give them opportunities to live healthy lives. We can and should make the system easier to navigate and care easier to access. We must modernize the state’s health workforce to make treatment more effective and more cost-effective. And we can and should expect innovation in Medi-Cal to keep pace with the evolution of care in the private sector.

3. Stop Treating Conditions and Start Treating People

Our health care safety net still is organized around the outdated assumption that one person’s body and mind require two or more separate systems of care. Today we know that physical health and mental health are inextricably bound together. It is past time to update our health care system to reflect that understanding.

It is especially important that we better integrate care for low-income Californians who experience mental illness, drug or alcohol addiction, or other complex health conditions. Even though they comprise a relatively small share of the population, they account for half of health care spending. Siloed systems of care cause needless and profound suffering.

Health care leaders and providers across California have been working harder than ever to address this problem. Innovations in policy, like Medi-Cal’s Whole Person Care and Drug Medi-Cal pilots, are giving communities new opportunities to integrate care. Technology innovations can help providers extend those opportunities to larger and larger numbers of people.

Solutions Are Out There. It’s Time to Put Them to Work Everywhere.

California has the power to accomplish each of these goals. We boast the world’s sixth largest economy. California is rich in health care and innovation talent. But even with those advantages, we cannot succeed without working together across sectors, across professions, and across ideological camps.

Health care is a universal value. It will take a universal effort to make sure all Californians can meet their basic need for care.

 

What’s at Stake: States’ Progress on Health Coverage and Access to Care, 2013–2016

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http://www.commonwealthfund.org/publications/issue-briefs/2017/dec/states-progress-health-coverage-and-access

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Abstract

  • Issue: Given uncertainty about the future of the Affordable Care Act, it is useful to examine the progress in coverage and access made under the law.
  • Goal: Compare state trends in access to affordable health care between 2013 and 2016.
  • Methods: Analysis of recent data from the U.S. Census Bureau and the Behavioral Risk Factor Surveillance System.
  • Findings and Conclusions: Between 2013 and 2016, the uninsured rate for adults ages 19 to 64 declined in all states and the District of Columbia, and fell by at least 5 percentage points in 47 states. Among children, uninsured rates declined by at least 2 percentage points in 33 states. There were reductions of at least 2 percentage points in the share of adults age 18 and older who reported skipping care because of costs in the past year in 36 states and D.C., with greater declines, on average, in Medicaid expansion states. The share of at-risk adults without a recent routine checkup, and of nonelderly individuals who spent a high portion of income on medical care, declined in at least of half of states and D.C. These findings offer evidence that the ACA has improved access to health care for millions of Americans. However, actions at the federal level — including a shortened open enrollment period for marketplace coverage, a failure to extend CHIP funding, and a potential repeal of the individual mandate’s penalties — could jeopardize the gains made to date.

Background

The year 2017 marked a turning point in the implementation of the Affordable Care Act. Republicans in Congress attempted to repeal and replace the Affordable Care Act numerous times, ultimately failing but promising to try again. In addition, the Trump administration significantly cut funding for outreach and enrollment activities during 2018’s open enrollment period for the marketplaces, and disrupted markets by declining to pay insurers money owed to them for providing cost-reduced plans for lower-income enrollees. In December, Senate Republicans passed a tax bill that included a provision to repeal the ACA’s individual mandate penalties, paid by most people who do not have health insurance. Given these developments, many Americans are confused about the ACA’s status, which could reduce the number of people who enroll in health plans for the coming year, despite strong enrollment thus far.

It is useful to assess the changes in coverage and access that happened across states under the law before this tumultuous year. Between 2013, the year before the ACA’s major coverage expansions took effect, and the end of 2016, the number of uninsured Americans under age 65 fell by an estimated 17.8 million.1 Uninsured rates declined in every state and the District of Columbia (Exhibit 1).

In this issue brief, we examine the extent to which health care access and affordability improved from 2013 to 2016 for residents in each of the 50 states and D.C. We use six indicators: uninsured rates for working-age adults and for children, three measures of adults’ access to care, and the percentage of individuals under age 65 with high out-of-pocket medical costs relative to their income (Exhibit 2). These measures align with those reported in the Commonwealth Fund’s ongoing series of Health System Performance Scorecards.

Implications

After three years of the ACA’s major coverage expansions, the number of uninsured working-age adults and children in the United States had fallen to a record low. This historic decline was accompanied by widespread reductions in cost-related access problems and improvements in access to routine care for at-risk adults, particularly in states that expanded Medicaid. If the 19 states that have not yet expanded Medicaid decided to expand, they could see similar positive effects for their residents.

There is no deadline for adopting the Medicaid expansion. In November, Maine residents voted to expand Medicaid under a citizen-initiated ballot referendum, indicating that popular support for expanding the program may exist in states where elected officials have rejected it. While implementation in Maine could face hurdles because of opposition from the state’s governor, similar efforts are now under way in other nonexpansion states.

Actions at the federal level could, however, jeopardize the gains made under the ACA. Recent actions by the Trump administration, including a shortened open enrollment period for marketplace coverage and deep cuts in advertising and outreach, could reduce enrollment for 2018.10 In addition, Congress has yet to extend funding for the Children’s Health Insurance Program, which expired at the end of September. In the absence of an extension, more than half of states are projected to run out of federal CHIP dollars by March 2018.11 The result could be a loss of coverage for millions of children.12

Further, the tax bill passed by Senate Republicans included a repeal of the ACA’s individual mandate penalties, which would mean a cancellation of the penalties owed by people who do not take up insurance. The Congressional Budget Office estimated that repealing the penalties would reduce the number of Americans with health insurance by 13 million by 2027 and significantly increase premiums for plans purchased in the individual market. This is because healthy individuals would be the most likely to forgo coverage, leaving sicker people (who are more expensive to insure) in the risk pool.13

People who buy their own coverage on the individual market and who have incomes above 400 percent of the federal poverty level (about $48,200 for an individual and $98,400 for a family of four) — the threshold for ACA premium subsidies — would face the brunt of the premium increase.14 A recent Commonwealth Fund analysis estimates that a 40-year-old buying unsubsidized individual market coverage in one of the 39 states that uses the federally facilitated marketplace would face an average dollar increase in premiums ranging from $556 in North Dakota to $1,264 in Nebraska (Exhibit 10).15

66% of Americans are stressed about health insurance costs: 3 things to know

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https://www.beckershospitalreview.com/payer-issues/66-of-americans-are-stressed-about-health-insurance-costs-3-things-to-know.html

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Across all income levels, two-thirds of U.S. adults cite health insurance costs as a stressor, according to a report from the American Psychological Association.

APA’s report, “Stress in America: Uncertainty About Health Care,” examines responses from 3,440 adults who completed an online survey by The Harris Poll from Aug. 2 to Aug. 31, 2017.

Here are three things to know from the report.

1. Sixty-three percent of adults said uncertainty about their future health and the health of others is a stressor.

2. Personal health concerns or health problems affecting family members reflect a “very” or “somewhat” significant source of stress for 60 percent of respondents.

3. On a 10-point scale, where 1 is “little or no stress” and 10 is “a great deal of stress,” uninsured respondents reported average stress levels of 5.6. This is compared to insured adults, who reported average stress levels of 4.7.

Under Obamacare, Out-Of-Pocket Costs Dropped But Premiums Rose, Study Finds

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http://www.wbur.org/commonhealth/2018/01/23/obamacare-household-spending

Isabel Diaz Tinoco (left) and Jose Luis Tinoco speak with Otto Hernandez, an insurance agent from Sunshine Life and Health Advisors, as they shop for insurance under the Affordable Care Act at a store setup in the Mall of Americas on Nov. 1, 2017 in Miami, Fla. The open enrollment period to sign up for a health plan under the Affordable Care Act runs until Dec. 15. (Joe Raedle/Getty Images)

Passing the Affordable Care Act was always much more about extending coverage than cutting costs. Still, as the landmark law faces one challenge after another, new data are giving a better picture of how the law has played out. That includes a new study that looks at how Obamacare affected household medical spending.

The short answer: On average, Obamacare did not affect household medical spending very much — but it definitely did cut costs for poorer people more than it did for people with more money. Here’s our discussion on Radio Boston, edited:

Host Meghna Chakrabarti: So what did this study find?

Carey Goldberg: The study was looking for how Obamacare was affecting our medical spending. As with everything with Obamacare, it’s complicated. But here we go: In a nationally representative sample of over 80,000 adults, overall, in the first couple of years after Obamacare really kicked in — 2014 and ’15 — out-of-pocket payments dropped by an average of $74.

And by out-of-pocket payments, you mean co-pays and payments you have to make because you haven’t hit your deductible yet.

Right, or procedures that aren’t covered. And meanwhile, the insurance premiums that households paid rose by an average of $232. So it’s a funny little coincidental parallel — out-of-pocket payments dropped by 12 percent, but premium payments rose by 12 percent.

But I’d imagine the effects really varied depending on a household’s income level?

They did. The ACA was meant mainly to help households with lower incomes, and it did. The study found that 6.5 percent of the population became newly insured after the ACA kicked in, and overall, the ACA predominantly helped lower-income people.

Here’s Dr. Anna Goldman, from Cambridge Health Alliance and Harvard Medical School, the lead author on the study: ‘The big picture is that the ACA did make real progress by reducing out-of-pocket spending, especially for poor and low-income households. But even in light of this progress, many American households still continue to face burdensome medical costs.’

On those ‘burdensome costs,’ this study also looked at what’s called ‘high-burden spending,’ which is defined as paying more than 5 or 10 percent of your income on out-of-pocket medical expenses. Premiums can be considered ‘high burden,’ too — that cut-off is if you’re paying more than 9.5 percent of your income.

So if I’m earning 20,000 a year, and I’m hit with out of pocket medical expenses of over $,1,000, that would be considered ‘high-burden’ or a premium that runs me close to $ 2,000 a year.

Right. So on these ‘high burden medical expenses, the good news is that out-of-pocket, high-burden spending fell by 20 percent overall — and it especially dropped for poor people. The not-so-good news for better-off folks is that among middle-income households, there was a 28 percent increase in high-burden spending on premiums.

Because premiums have been getting steeper and steeper. Does this study suggest the ACA is to blame?

No. Dr. Goldman says a better way to look at it is that while the ACA did help with out-of-pocket costs, it didn’t stem from the rise in premiums that was already underway.

I have to admit this is a little underwhelming. We have devoted so much attention and so much political wrangling to Obamacare over the last years, and this study is telling us that at least in the first couple of years, and in terms of household costs, it’s been something of a wash.

I feel the same way. What Dr. Goldman, the lead researcher, commented about that is, look, the ACA was the biggest reform of the health care system since 1965, and to get passed it had to involve a lot of political compromise:

‘It was nowhere near as radical as it could have been,’ she said. ‘I think that a single-payer plan, for example, which many Democrats on the more progressive side of the party were advocating for, would have been much more effective in reducing medical spending by all American households, certainly for people in poor and low-income households — no co-payments, no deductibles, no premiums.”

This isn’t news either, but a single-payer system apparently in this country has not been in the realm of the politically possible.

I would think the ACA as it is right now isn’t even within the realm of political possibility at the moment. The individual mandate is already out.

It’s on its way out. Although not here in Massachusetts, we should note. But what this study also tells us is that as the individual mandate and other aspects of the ACA get phased out, it will be largely the poorer people who will mostly lose out.

In the study’s conclusions the authors write that without the individual mandate, the numbers of people without insurance will go back up again, as will out-of-pocket costs, and premiums will likely rise, too, because healthier people won’t be buying insurance.

The final sentence of the paper says that international experience shows that a universal, comprehensive national health insurance program would be the most effective way to reduce household spending on medical expenses and the gaps between rich and poor.

 

Podcast: ‘What The Health?’ While You Were Celebrating …

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https://khn.org/news/podcast-what-the-health-while-you-were-celebrating/?utm_campaign=KFF-2018-The-Latest&utm_source=hs_email&utm_medium=email&utm_content=59811229&_hsenc=p2ANqtz–JERFINvucriGGpU1rflJEeJxuQPVDm8Wxcl7b-PGXeAoVUch8Oz-J5zdRyTzl09wIqr9zHKJO6Lrp-P6xvIdaGh3oKQ&_hsmi=59811229

Image result for Podcast: ‘What The Health?’ While You Were Celebrating …

The year in health policy has already begun: The Trump administration Thursday released a long-awaited regulation aimed at making it easier for small businesses and others to form “association health plans.” Now advocates and opponents will be able to weigh in with more specific recommendations.

Meanwhile, in December, the health policy focus was on the tax bill and its repeal of the Affordable Care Act’s “individual mandate” penalty for most people who don’t have health insurance. But some recent key court decisions could reshape the benefits millions of people receive as part of their health coverage.

This week’s “What the Health?” guests are Julie Rovner of Kaiser Health News, Paige Winfield Cunningham of The Washington Post, Alice Ollstein of Talking Points Memo and Margot Sanger-Katz of The New York Times.

They discuss these topics, as well as the prospects for pending health legislation on Capitol Hill.

Among the takeaways from this week’s podcast:

  • The Trump administration’s decision to expand association health plans faces a number of obstacles, including the lack of good oversight in many states and the poor track record of many past plans.
  • Consumer advocates fear that growth of association plans could leave many consumers without adequate benefits because some plans will not cover the same essential benefits that Obamacare plans guarantee. They also are concerned that healthy customers will migrate to the new plans and leave the ACA’s marketplace plans with an abundance of enrollees who are ill.
  • The prospects of the bill to stabilize the individual insurance market sponsored by Sens. Lamar Alexander (R-Tenn.) and Patty Murray (D-Wash.) appear to be dimming.
  • Two federal judges have ruled against the Trump administration rule to change the ACA’s contraception mandate. The decisions, though, are not based on the policy but on faulty rule-making.
  • In another highly watched court case, a federal judge has ruled that the Equal Employment Opportunity Commission has until 2019 to set new rules on what employers can require of workers in their wellness programs.

Association health plan proposal: Experts wary of weak consumer protections, oversight issues

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https://www.fiercehealthcare.com/regulatory/association-health-plans-consumer-protections-tim-jost?mkt_tok=eyJpIjoiTjJRNU5qUXlZVEJqWmpjNCIsInQiOiJOR2V2bEp4NkdoeVB3VndhZE43TVBjZXdaTGJcLzk1Z3hBd1wvZ05teDMrcjZ5UzJhb0tzUkpQbWlaSmVvUmJFazVDcERmajBTREhCTXJxR3BBaGtoY1MrZlVtQW5xeXRSbFwvYVhPOE44VE9uYUhNZWNnbGtoR3c3S0xHUlp5SlwvS2kifQ%3D%3D&mrkid=959610

stethoscope, coins and calculator

The new proposal to expand association health plans promises to provide more affordable insurance options for small-business owners and employees. But some experts aren’t convinced that this is the right solution.

For one, the proposal’s promises of consumer protections aren’t as strong as they seem, said Timothy Jost, a Washington and Lee University professor emeritus who closely follows the ACA.

Association health plans can’t charge higher premiums or deny coverage based on health status, according to the Department of Labor (DOL). But because AHPs would be subject to large-employer market rules, they wouldn’t have to cover the list of essential health benefits that the Affordable Care Act mandates.

The upshot, Jost told FierceHealthcare, is that insurers could legally weed out those with costly conditions while still complying with regulations that bar them from denying those individuals coverage or hiking their premiums.

“If you can’t exclude someone because they have cancer, it’s easy to just not cover chemotherapy,” he said. “Or if you can’t exclude people who have mental illness, it’s easy to just not cover mental health care.”

And Larry Levitt, senior vice president of the Kaiser Family Foundation, pointed out in a Twitter post that insurers could still hike premiums based on factors other than health status:

 The association health plan regulation prohibits variation in premiums based on health. It does not prohibit premium variation based on any other factor, such as gender, age, industry or occupation, or business size.
 Cherry-picking enrollees

Association health plans are also likely to be marketed toward the healthiest, youngest individuals, Jost noted.

“I doubt anybody is going to be out there writing association coverage for occupations that are predominantly people who are older or have chronic health problems,” he said.

The problem, then, is that AHPs would siphon more low-risk consumers out of the individual marketplaces—thus skewing that risk pool and likely causing insurers to raise premiums.

“I think everybody understands that this is going to undermine the market for ACA-compliant plans,” Jost said.

Andy Slavitt, the former Centers for Medicare & Medicaid Services acting administrator, laid out his own criticisms in a Twitter thread—including pointing out that breaking up risk pools goes against the proposal’s stated purpose of giving small businesses more clout:

 The regulation aims to push the idea of what can be considered an association.

Someone I talked to today referred to it as being able to create an “air breathers association.” Essentially, making it as rude-less as possible.

 Many of the premises of AHPs have been shown not to work in the past.

For example, the rule says AHPs will create “increased buying power”. Breaking up pools does exactly the opposite.

Instead, a “Runners’ Association” just sends a clear signal that these are healthy people.

Limited impact

Merrill Matthews, Ph.D., a resident scholar at the right-leaning Institute for Policy Innovation, praised the new proposed rule, noting that it allows small businesses to do what large employers have long been able to: self-insure.

“Self-insured employers have been able to avoid many of the state and federal mandates imposed on the small group and individual markets, which helped employers keep down the cost of coverage,” he said.

But even Matthews acknowledged that the impact of the proposed policy changes is likely to be limited, as it will only apply to small employers and possibly some self-employed individuals. Since the proposed changes are “unlikely to provide much relief” for those affected by high premiums in the individual market, he said, “Congress still needs to repeal the Affordable Care Act.”

Questions about oversight

Perhaps the biggest issue that Jost saw with the new proposal was the fact that AHPs have had past issues with insolvency, bankruptcy and even fraud.

“There’s just a long history of association health plans being formed that are thinly capitalized, that pay large salaries and expenses for their owners, and disappear when the going gets rough,” he said.

For its part, the DOL said it will “closely monitor these plans to protect consumers.” But Jost pointed out that the agency has experienced staff and budget cuts that might undermine that goal.

Even the DOL itself said in the proposed rule that “the flexibility afforded AHPs under this proposal could introduce more opportunities for mismanagement or abuse, increasing potential oversight demands on the department and state regulators.”

Ultimately, what plays out will largely be decided by how states respond to the new regulations once they are implemented, Jost added.

“In states that try to take an aggressive approach to regulating them, there won’t be that much activity,” he said. “And in states that take a hands-off approach and let anything go, there will be probably quite a bit of activity until [AHPs] start going belly up.”

 

AP-NORC Poll: Health Care Is the Issue That Won’t Go Away

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https://www.nytimes.com/aponline/2017/12/21/us/politics/ap-us-ap-poll-health-care.html

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As President Donald Trump completes his first year in office, Americans are increasingly concerned about health care, and their faith that government can fix it has fallen.

A new poll by The Associated Press-NORC Center for Public Affairs Research finds that 48 percent named health care as a top problem for the government to focus on in the next year, up 17 points in the last two years.

The poll allows Americans to name up to five priorities and found a wide range of top concerns, including taxes, immigration and the environment. But aside from health care, no single issue was named by more than 31 percent.

And 7 in 10 of those who named health care as a top problem said they had little to no confidence that government can improve matters. The public was less pessimistic in last year’s edition of the poll, when just over half said they lacked confidence in the problem-solving ability of lawmakers and government institutions.

“We are way up there on the cost, and as far as giving good health care, we are way down,” said Rebekah Bustamante of San Antonio, a retired medical imaging technician. “Now in health care, you’re a number.”

Bustamante said she voted for Trump, but “he’s learning on the job, and he’s got a long way to go.”

Trump initially promised his own plan that would deliver “insurance for everybody” and “great” health care, “much less expensive and much better.” But the White House never released a health care proposal from the president.

GOP legislation to repeal and replace former President Barack Obama’s health care law failed in Congress, although the tax bill scraps the Obama requirement that most people get health insurance. Bloodied on both sides, Republicans and Democrats seem to have battled to an uneasy draw on health care.

Meanwhile, conflicting policy signals from Washington, including an abrupt White House decision to cancel insurer subsidies, roiled insurance markets. Premiums on health plans purchased by individuals jumped by double digits. Progress reducing the number of uninsured stalled, and one major survey found an uptick this year.

“There is zero bipartisanship, and it’s frustrating,” said Eric Staab, a high school teacher from Topeka, Kansas. “It seems like we have thrown everything at this dartboard, and nothing is improving the coverage.”

Rumblings of discontent have political repercussions for next year’s midterm elections and the presidential contest in 2020, said Robert Blendon, a professor at the Harvard T.H. Chan School of Public Health, who follows opinion trends on health care.

“It’s the issue that won’t go away,” said Blendon. “Given the news cycle, taxes should be first, the economy should be second, and this health care thing should be buried.”

Three in 10 Americans listed taxes among their top priorities, about double the percentage who said that last year. About a quarter mentioned immigration, and just under 2 in 10 mentioned environmental issues and education. Meanwhile, concerns about unemployment plunged to 14 percent, about half the mentions as last year.

Health care was by far the top issue mentioned by Democrats and independents. Republicans were about equally likely to mention immigration, health care and taxes.

Democrats were more likely than Republicans to say they have little to no confidence that the government will make progress on health care, 84 percent to 57 percent.

The reason health care doesn’t fade away is that costs aren’t getting any more manageable, said some people who took part in the AP-NORC survey.

Bustamante said she is planning a trip to Mexico for some dental work, because she can obtain quality service for much less there. “Thank God I live in Texas, where getting to Mexico isn’t that far away,” she said. “But everybody doesn’t have that option.”

ShyJuan Clemons of Merrillville, Indiana, said he’s currently uninsured because his previous health plan was costing too much money for the benefit he got from it. He faced his insurance plan’s annual deductible when he went to the doctor, so he’d wind up paying out-of-pocket for visits, on top of premiums.

“You are not constantly worried about taxes, but you are constantly worried about health care — be it major or minor,” said Clemons, a personal care attendant who works with disabled people. “You catch a cold, and you just think about it in passing — ‘I hope it doesn’t develop into a problem.'”

Clemons, a Democrat, said he’s disappointed that Trump and Republicans in Congress seem to be trying to tear down “Obamacare” instead of building on it. “I would like to see them make the thing run smoothly so we can do better, instead of just trying to cripple it,” he said.

The lack of confidence in the ability of government to find pragmatic solutions extended to other problems in the AP-NORC poll, including climate change, immigration, and terrorism.

Just 23 percent said that Trump has kept the promises he made while running for president, while 30 percent said he’s tried and failed, and 45 percent said he has not kept his promises at all.

Nearly 2 in 3 said they were pessimistic about the state of politics in the U.S. About half were downbeat about the nation’s system of government, and 55 percent said America’s best days are behind.

 

Out-of-pocket health spending in 2016 increased at the fastest rate in a decade

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https://www.washingtonpost.com/news/wonk/wp/2017/12/06/out-of-pocket-health-spending-in-2016-increased-at-the-fastest-rate-in-a-decade/?utm_term=.42b85bdeba98

U.S. health care spending increased to $3.3 trillion in 2016, with out-of-pocket health care costs borne directly by consumers rising 3.9 percent — the fastest rate of growth since 2007.

The findings, published Wednesday by Health Affairs, are considered the authoritative breakdown of American health care spending and are prepared each year by the Centers for Medicare and Medicaid Services.

The overall rate of increase in health care spending experienced a slight slowdown over the previous year, driven in part by the expected moderation in growth after the expansion of insurance coverage through the Affordable Care Act. There was also a sharp decrease in the growth of prescription drug expenditures, as hepatitis C treatment costs have declined and fewer patients are receiving them.

The slowdown in spending growth — a 4.3 percent increase in 2016, following a 5.8 percent growth the previous year — stemmed from changes in a broad array of health care sectors.

That ranged from slower growth in Medicaid spending after the surge in enrollment caused by the Affordable Care Act expansion, to a marked slowdown in prescription drug spending growth that had been pushed higher by the approval of a new, expensive treatment for hepatitis C in 2013.

A shift toward insurance plans that transfer more of the burden of health care costs onto patients helped fuel the rise in out-of-pocket costs. In 2016, 29 percent of people who receive insurance through employers were enrolled in high-deductible plans, up from 20 percent in 2014. The size of the deductibles also increased over this time period, a 12 percent increase in 2016 for individual plans, compared with a 7 percent increase in 2014.

Out-of-pocket spending grew the most on medical equipment and supplies and decreased slightly for prescription drugs, according to the analysis.

The most noticeable change was a big slowdown in prescription drug spending growth, which made up 10 percent of the total spending, or $328.6 billion. (That spending number does not include drugs administered by physicians or hospitals.)

That decrease highlights the effect that expensive new treatments used by large numbers of people can have on national spending. A new generation of expensive hepatitis C drugs drove national drug spending 12.4 percent higher in 2014 and 8.9 percent higher in 2015. In 2016, the prescription drug spending increased by 1.3 percent, closer to the rates in the years before the new drugs were approved.

The authors of the report attributed that trend not just to hepatitis C drugs. There were also fewer new, brand name drugs approved in 2016 — 22 new drugs, compared with 45 the previous year. Another factor was a slowdown in the growth of spending on insulin, a lifesaving drug for people with diabetes, in Medicare.

Insulin prices have been under intense scrutiny as drugmakers have increased the list prices of insulin while claiming the true cost to patients has remained flat due to discounts and rebates

Health care spending has been buffeted by unusual changes during the past decade. There was a historic slowdown in growth due to the Great Recession, and then the Affordable Care Act’s expansion of health insurance coverage fueled spending.

The authors said this year’s trend of slower growth could be a sign that things were returning to normal.

“Future health expenditure trends are expected to be mostly influenced by changes in economic conditions and demographics, as has historically been the case,” the authors wrote.