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Tag Archives: Out of Pocket Expenses
Healthcare Triage News: Many with Employer Insurance Still Need CHIP to Insure Their Kids
Healthcare Triage News: Many with Employer Insurance Still Need CHIP to Insure Their Kids
As employer-sponsored insurance becomes more expensive for children, public programs are picking up the slack. This is Healthcare Triage News.
Covering the Coming Battle Over the ACA: What You Need to Know
GOP chairman: Drug prices ‘high on our agenda’
House Energy and Commerce Committee Chairman Greg Walden (R-Ore.) said Tuesday that dealing with high drug prices will be “high on our agenda.”
The comments come after Walden attended a meeting at the White House earlier in the day with President Trump and the CEOs of several major drug companies, at which Trump pressed the companies to bring their prices down.
However, Walden pointed to solutions that are less far-reaching than what Democrats and Trump have proposed, such as allowing Medicare to negotiate drug prices. Instead, Walden said there could be legislation to speed up the Food and Drug Administration’s approval process for a new competitor to a drug that currently lacks competition.
Walden said that implementing the 21st Century Cures Act, passed by Congress last year, to speed up the FDA’s approval process, is also an important part of the picture.
Trump has gone farther than most Republicans in the past on drug prices, calling for Medicare to negotiate. Trump did not directly call for that policy on Tuesday, though.
Getting any drug pricing legislation through Congress would be a tall task, given how fraught the issue is and the resistance of many Republicans to government action on the issue.
Premium support is back. What is it?
Click to access premium-support.pdf
A number of Republican health care policy proposals that seemed out of favor in the Obama era are now being given new life. One of these involves Medicare, the government health insurance program primarily for older Americans, and is known as premium support.
Right now, the federal government subsidizes Medicare premiums — those of the traditional program, as well as private plan alternatives that participate in Medicare Advantage. The subsidies are established so that they grow at the rate of overall per enrollee Medicare spending. No matter what Medicare costs, older Americans can be sure that the government will cover a certain percentage of it. That’s the main thing that panics fiscal conservatives, because that costs the government more each year.
Premium support could quiet that fear. Subsidies would be calculated so they don’t grow as quickly, thus protecting the federal government (that is, taxpayers) from runaway spending. There are lots of variants, but there are really two principal ideas.
Why we should listen to Martin Shkreli
The public already knows that the medicines we make can be enormously valuable. They just think we charge too much for them, and it is hard to find a good argument that we aren’t doing that. Take Sovaldi — Gilead launched a cure for the scourge of hepatitis C, something everyone wanted, priced it at what the market couldn’t refuse, and then faced the inevitable backlash.
In good years, innovation in the pharmaceutical industry amounts to 30 to 40 new products. Yet we’re charging the world for the 50,000 candidates that it took us to get to those 30 or 40. And that ratio is unlikely to change for as long as the market will bear the increasing cost. Unfortunately, there are signs that the market and public opinion have changed, and the lobbyists have chosen to ignore them.
The answer to fixing the pharmaceutical industry’s reputation doesn’t lie in vilifying Shkreli. He just supersized its business model, one that the lobbyists are defending at all costs.
Instead, we must choose to be different. We need to regain our ethical core and to be, once again, known as ethical pharma. And that’s where we need real leadership.
More families with employer-sponsored insurance are needing public assistance
As employer-sponsored insurance becomes more expensive for children, public programs are picking up the slack.
The Medicaid Expansion, which was responsible for a large part of the reduction in uninsurance in the United States over the last few years, was mostly aimed at adults. This is because Medicaid has traditionally covered nearly all children in poverty for some time. The CHIP program has bolstered that coverage, so that uninsurance in children fell steadily in the 1990’s and well into the 21st century.
The passage of the Medicare Access and CHIP Reauthorization Act of 2015 (MACRA) assured that CHIP coverage would continue for some time. But even before that, trouble was brewing with respect to the coverage of children. These troubles were not in the Medicaid program, though. Issues were arising in the employer-sponsored insurance market.
As I’ve written about in many posts here before, the cost of employer-sponsored insurance has been rising quite steadily for some time. Further, the out-of-pocket costs for such insurance have also been increasing. Deductibles, co-pays, and co-insurance – not to mention premiums – can put the cost of insurance out of reach for many employees even when it is “offered” as a benefit from their job. The costs of insurance have outpaced both income and wages for more than a decade, meaning that more and more must come out of employee’s pockets if they want to maintain coverage for themselves and their children.
California’s Uninsured: As Coverage Grows, Millions Go Without
Click to access PDF%20CaliforniaUninsuredDec2016.pdf
Since the implementation of the Affordable Care Act (ACA) in 2014, the uninsured rate in California dropped by nearly half, from 16% in 2013 to 9% in 2015. However, 2.9 million Californians remained uninsured.
California’s Uninsured: As Coverage Grows, Millions Go Without provides a look at the uninsured two years after full implementation of the ACA. There could be big changes in health insurance coverage ahead with the election of President Donald Trump.
Key findings include:
- The drop in the uninsured rate was mainly due to a seven percentage point increase in individually purchased insurance coupled with a five percentage point increase in Medi-Cal enrollment.
- One in three of California’s uninsured had annual incomes of less than $25,000. At this income level, people are potentially eligible for Medi-Cal.
- Of the state’s remaining uninsured, one in four were age 25 to 34, one in three were noncitizens, and more than half were Latino.
- 62% of the uninsured were employed. Of the 1.8 million uninsured workers, 44% worked in firms with fewer than 50 employees.
- Fewer Californians cited “lack of affordability” as the main reason for going without health insurance in 2015 compared to 2014.
Why risk adjustment is a crucial component of individual market reform
The mantra of ‘Repeal and Replace’ has escalated in recent weeks, though what, specifically, the ‘Replace’ component might look like is still unclear. However, many of the current proposals include, at a minimum, some type of continuous coverage provision that allows people with chronic health conditions who have continuously maintained coverage to buy health insurance at standard rates. For example, Paul Ryan’s A Better Way proposal and Tom Price’s Empowering Patients First Act would each prohibit insurers from charging sicker patients more than standard premiums in the individual market as long as they have maintained continuous coverage since before becoming sick.
Such provisions are important to keep patients from seeing their health insurance premiums sky-rocket after becoming sick, which would defeat the purpose of insurance in the first place. However, these provisions also require that insurers sell policies to these patients at premiums that they know will not cover their expected health care spending, generating losses for the insurance company. On its own, this would create a situation where insurers have a strong financial incentive to avoid enrolling these sicker patients.
Risk adjustment combats disincentives to provide coverage for sicker patients
In order to mitigate these incentives for insurance companies to avoid sicker patients, policymakers will need to include a risk adjustment program in any replacement reforms that require insurers to issue insurance to any applicant (also known as “guaranteed issue”) and set limits on adjusting premiums to fully reflect an enrollee’s health status. Continuous coverage provisions are one example of such limits, but risk adjustment will be necessary to combat against adverse selection across a wide range of potential reforms.
A risk adjustment program would make behind-the-scenes financial transfers to insurers to adequately compensate them for enrolling these sicker patients when they are not allowed to charge the individual higher premiums. Risk adjustment will be necessary to promote a well-functioning market where private insurers compete based on the value they deliver and not simply by avoiding sicker patients.
HENRY KOTULA 