CBO’s Revised View Of Individual Mandate Reflected In Latest Forecast

https://www.healthaffairs.org/do/10.1377/hblog20180605.966625/full/?utm_term=Read%20More%20%2526gt%3B%2526gt%3B&utm_campaign=HASU&utm_content=email&utm_source=06-10-18&utm_medium=Email&cm_mmc=Act-On%20Software-_-email-_-Health%20Affairs%20June%20Issue%3A%20Hospitals%2C%20Primary%20Care%20%2526%20More%3B%20ACA%20Round-Up%3B%20Harassment%20In%20Medicine-_-Read%20More%20%2526gt%3B%2526gt%3B

On May 23, the Congressional Budget Office (CBO) released updated projections of federal spending and tax expenditures related to supporting enrollment in health insurance, along with a new forecast of the number of Americans younger than age 65 who will have coverage or will be uninsured in the coming years.

The bottom line: The CBO continues to expect that the Affordable Care Act’s (ACA’s) markets will have relatively stable enrollment, more states will expand their Medicaid programs, and per-person health costs will rise at rates that exceed economic growth. Federal spending on subsidies for health insurance enrollment, along with tax breaks for employer coverage, will continue to grow at a rapid rate, thus intensifying pressure within the overall federal budget.

While the CBO’s new forecast looks in many ways quite similar to previous projections, the agency has revised its views on one very important aspect of its forecast—the effectiveness of the individual mandate—and also updated its forecast to reflect the effects of relevant executive decisions and proposed regulations by the Trump administration. These revisions and updates to the forecast are the primary reasons the current baseline does not differ more than it does from those issued by the CBO previously.

CBO’s Revised View Of The Individual Mandate

The most notable change in the CBO’s new forecast is the agency’s revised view of the effectiveness of the ACA’s individual mandate. During 2017, as Republicans in Congress attempted to pass legislation substantially rolling back and replacing the ACA, the CBO estimated that these efforts would dramatically increase the number of Americans going without insurance coverage. For instance, in July 2017, the CBO estimated that the version of repeal and replace assembled by Senate Majority Leader Mitch McConnell (R-KY) would have increased the number of uninsured from 28 million in 2017 to 41 million in 2018 and 50 million in 2026. There were several reasons that the McConnell proposal would have led to more people going without coverage, but the CBO specifically cited the planned repeal of the individual mandate as the most important factor.

In December, Congress repealed the penalty associated with the individual mandate as part of the sweeping individual and corporate tax reform law. At the time of enactment, the CBO estimated that the repeal would eventually lead to an increase in the number of people going without health insurance by 13 million people annually.

The CBO’s new forecast, however, places less weight on the importance of the mandate. The agency states that, for a number of reasons, it now believes that the mandate’s role in expanding coverage after 2013 is only about two-thirds of what it previously assumed. So instead of repeal adding 13 million more people to the ranks of the uninsured, the CBO now estimates the effect at slightly more than 8 million people.

The CBO cites a number of considerations for making this important revision to its forecast. Among other things, the agency is placing more emphasis on the financial reasons for expanded enrollment into coverage after 2013, such as the ACA’s subsidy structure, instead of nonfinancial factors, such as the expectation, or social norm, of insurance enrollment that the mandate was intended to create.

Summing Up 

In the aggregate, the CBO’s updated projections of health insurance enrollment and federal subsidies for coverage do not differ all that much from previous projections. What’s different are some of the assumptions. The CBO expects there will be more uninsured in the future than is the case today, but the agency does not expect a reversion back to the uninsured levels of the pre-ACA era. Furthermore, because of changes in policies set in motion by the Trump administration, there are likely to be more people enrolled in non-ACA compliant insurance plans than is the case today, and that coverage, while different, will still provide a reasonable level of financial protection to enrollees.

 

 

KHN’s ‘What The Health?’ Health Care Politics, Midterm Edition

Podcast: KHN’s ‘What The Health?’ Health Care Politics, Midterm Edition

Image result for KHN’s ‘What The Health?’ Health Care Politics, Midterm Edition

The 2018 midterm elections were supposed to be a referendum on President Donald Trump, not about issues such as health care. Still, voters, Democrats and, to a lesser extent, Republicans seem to be keeping health care on the front burner.

The news from Medicare’s trustees that its hospital trust fund is on shakier financial footing than it was last year, hefty premium increases being proposed in several states and activity on Medicaid expansion all take on a political tinge as the critical elections draw closer.

Also this week, an interview with Matt Eyles, president and CEO of America’s Health Insurance Plans, the health insurance industry trade group.

This week’s panelists for KHN’s “What the Health?” are Julie Rovner of Kaiser Health News, Stephanie Armour of The Wall Street Journal, Alice Ollstein of Talking Points Memo and Rebecca Adams of CQ Roll Call.

Among the takeaways from this week’s podcast:

  • Outside Washington, concerns about health care accessibility and prices remain a big issue.
  • Democrats, looking toward the midterm elections in the fall, think that health care can be a potent issue for them. But many also believe that they can’t just run on complaints that the Republicans are sabotaging the Affordable Care Act. They are seeking to find a message that looks to the future.
  • Republicans see the plans by the White House to implement new regulations that allow expansion of association health plans and short-term health plans as a strong action that will thwart complaints that they haven’t fixed the ACA.
  • The states are beginning to release the initial requests from health insurers for premium increases. They vary substantially, but many appear to be partly attributed to the decision last year by Congress to repeal the penalty for people who don’t get insurance.
  • The report this week by the Medicare trustees that the hospital trust fund is closer to insolvency has ignited Democratic criticism of changes in health care law that were part of the GOP tax cut last year.
  • Arkansas has begun implementing its work requirements for healthy adults covered by the Medicaid expansion. It’s the first state to do that. But critics point out that those adults will have to register their work hours online only — and many do not have access to computers.

 

Premium hikes reignite the ObamaCare wars

http://thehill.com/policy/healthcare/387836-premium-hikes-reignite-the-obamacare-wars?userid=12325

Image result for aca higher premiums

The ObamaCare premium wars are back.

The cost of health insurance plans on the ObamaCare exchanges could jump in the coming weeks, some by double digits, inflaming the issue ahead of the midterm elections.

Democrats argue the price increases are the result of what they refer to as “Republican sabotage.” They contend that, since the GOP controls Congress and the White House, the price hikes are their responsibility — and that’s the message they plan to take into the fall campaign.

“If these early states are any indication, health insurance companies are going to ask for huge hikes in the wake of President Trumpand congressional Republicans’ repeated efforts to sabotage our health-care system,” Senate Minority Leader Charles Schumer (D-N.Y.) said at a press conference last week. “And we Democrats are going to be relentless in making sure the American people exactly understand who is to blame for the rates.”

Republicans counter that it was Democrats who passed the law, enacted in 2010, in the first place and without any GOP votes. And they blame Democrats for the failure to pass a bill that was aimed at shoring up ObamaCare’s exchanges.

Democrats wrote the Affordable Care Act, so “they should look in the mirror,” Sen. Lamar Alexander (R-Tenn.), chairman of the Senate Health Committee, said last week on the Senate floor.

“And this is the very worst. When Republicans were prepared one month ago to stabilize these markets — and according to the Oliver Wyman health-care experts, to lower rates by up to 40 percent over three years — the Democrats said no,” he said.

For years, Republicans had the upper hand on health care, with the backlash to the Affordable Care Act helping them win the House in 2010, the Senate in 2014 and the White House in 2016.

During the Obama administration, Republicans railed against ObamaCare premium hikes while pledging to repeal and replace the law.

But that repeal push ended in failure last year, and Democrats say the political winds have shifted in their favor.

Democrats argue that any higher premiums this year will be a direct result of the Republican Congress and the Trump administration. They refer to certain actions by the GOP — such as the repeal of the individual mandate to have health insurance — as acts of “sabotage” that will siphon healthy people out of the ObamaCare insurance markets, leading to sicker people on the plans and higher costs.

“Thus far, Democrats have been on the defensive about premium increases,” said Cynthia Cox, a health insurance expert with the Kaiser Family Foundation. “Now they’re starting to play offense, and from our polling we’ve seen that a lot of the public now feels that the Trump administration and Congress are responsible for any problems with the [Affordable Care Act] going forward, so it may be that the politics of premium increases has changed.”

Protect Our Care, a pro-ObamaCare group, launched “Rate Watch” on Tuesday, a media campaign and website aimed at getting out the Democrat’s message that Republicans are to blame for rate hikes.

Only a handful of states have released proposed premiums for next year, as insurers are largely still hammering out what their preliminary rates are going to be.

In Maryland, the average proposed increase among insurers and plans was 30 percent. CareFirst BlueCross BlueShield, for example, requested an 18.5 percent hike for its HMO plans and 91.4 percent for its PPO plans.

In Virginia, proposed rate hikes varied widely, from 15 percent to 64 percent. Vermont’s proposed premium increases were more modest.

It’s too early to know the full picture for what premiums will look like around the country for 2019. Insurers tend to file proposed rates in the late spring and early summer, and they’re generally not finalized until early fall — a little more than a month before the ObamaCare exchanges open for business on Nov. 1.

“It’s hard to come up with a general impression … but I think what we can expect is probably another year of double-digit rate increases driven in large part by the individual mandate repeal and the expansion of short-term health plans and association health plans,” Cox said.

The Trump administration proposed a rule to increase the length of time a consumer can keep a plan that doesn’t comply with ObamaCare’s insurance regulations from three months to nearly a year. Democrats deride those plans as “junk insurance.”

Association health plans would let small businesses and self-employed individuals band together to buy coverage that doesn’t comply with ObamaCare’s rules.

Republicans say the rules will expand choice and allow people to buy cheaper alternatives to ObamaCare plans.

Some insurers have cited the repeal of the individual mandate as a factor in their decision to propose rate hikes, and at least one also included the proposed regulations from the administration as a factor.

Some insurance commissioners across the country are approaching the open enrollment period with a level of “concern and a bit of trepidation,” said Julie Mix McPeak, Tennessee’s insurance commissioner who serves as the president of the National Association of Insurance Commissioners.

In McPeak’s home state, she’s hopeful that signs are pointing to rates beginning to plateau and that Tennessee won’t see the large hikes of years past.

“My experience in Tennessee … is not typical for all of the states in the United States,” said McPeak, who was appointed to run the state’s insurance department by Gov. Bill Haslam (R.).

“I’m hearing from some of my colleagues from the national perspective that they are looking at significant rate increases,” she said.

Dave Jones, California’s Democratic insurance commissioner, said he’s worried that some insurers may leave parts of the state.

“We’re working closely with our exchange and other California agencies to do everything we can to encourage insurers to stay and to create as much stability as we can, not withstanding all of the rocks that the Trump administration is throwing at health-care reform,” he said.

If the short-term and association health plan rules are implemented, Jones said he’s prepared to file litigation aimed at stopping the regulations.

In North Dakota, the state’s Republican insurance commissioner is more optimistic.

Jon Godfread said he expects North Dakota’s marketplace will consist of three carriers selling plans across the state — an increase from last year, when areas had only one or two insurers to choose from.

As for rate hikes, he’s hoping in the low double-digits or, worst case, in the 18 percent to 22 percent range. He believes the repeal of the individual mandate won’t have much impact on consumer behavior in North Dakota because people who couldn’t afford insurance have likely already left the marketplace in the state.

“Health insurance and health care by its very nature is demographic,” Godfread said. “We may be leading into a somewhat calm year — in North Dakota, at least that’s what we’re hoping for. But that doesn’t mean my colleagues in Iowa and Nebraska and other places aren’t facing some pretty significant challenges, and we very well, that could be us next year, or it could be us this year still, too. There’s a lot of time between now and open enrollment.”

 

 

Let the ACA rate hikes begin

Image result for ACA Rate Hikes

Get ready for about six more months of headlines like this: Insurers in Maryland are proposing premium hikes as high as 91% for coverage sold through the Affordable Care Act.

This will keep happening, nationwide. Proposed increases have been steep in Maryland and Virginia, the first two states to release them. But all signs point to steep hikes across the country, especially in rural areas. Some insurers also will likely decide to simply quit offering coverage in some parts of the country.

The latest: Insurers in Maryland’s individual market are seeking rate hikes for next year that range from 18% (for the biggest plan in the state) to 91% (for the smallest). They average out to roughly 32%.

  • These rates are still preliminary — Maryland can approve or reject proposed increases, and it’s also pursuing a reinsurance program that would help bring these increases down.

Why you’ll hear about this again: More preliminary rates will trickle out until the summer, as will any insurers’ decisions to pull up stakes in some markets. After negotiations with state regulators, rates will be finalized a few weeks before the midterms.

  • Expect to hear Democrats making hay of these increases as they accuse Republicans of “sabotaging” the ACA.
  • There’s really no denying that the repeal of the ACA’s individual mandate, coupled with some of the Trump administration’s regulatory moves, is a big driver — though not the only driver — of these staggering increases.

The other side: Expect the Trump administration to cite these same figures as it finalizes regulations that would loosen access to options outside the ACA’s exchanges, saying they’re providing new options to people who simply can’t afford ACA coverage.

  • Don’t forget, though, that some of those options would only benefit the healthiest consumers.

How The Farm Bill Could Erode Part Of The ACA

How The Farm Bill Could Erode Part Of The ACA

Some Republican lawmakers continue to try to work around the federal health law’s requirements. That strategy can crop up in surprising places. Like the farm bill.

Tucked deep in the House version of the massive bill — amid crop subsidies and food assistance programs — is a provision that supporters say could help provide farmers with cheaper, but likely less comprehensive, health insurance than plans offered through the Affordable Care Act.

It calls for $65 million in loans and grants administered by the Department of Agriculture to help organizations establish agricultural-related “association” type health plans.

But the idea is not without skeptics.

“I don’t know that anyone at the Department of Agriculture, with all due respect, knows a darn thing about starting and maintaining a successful insurance company,” said Sabrina Corlette, a professor and project director at the Georgetown University Health Policy Institute.

Association health plans are offered through organizations whose members usually share a professional, employment, trade or other relationship, although the Trump administration is soon to finalize new rules widely expected to broaden eligibility while loosening the rules on benefits these plans must include.

Under that proposal, association plans would not have to offer coverage across 10 broad “essential” categories of care, including hospitalization, prescription drugs and emergency care. They could also spend less premium revenue on medical care.

Under the farm bill, the secretary of Agriculture could grant up to 10 loans of no more than $15 million each, starting next year, to existing associations whose members are ranchers, farmers or other agribusinesses.

The language is strikingly similar to a bill introduced April 12 by Rep. Jeff Fortenberry (R-Neb.), a supporter of association health plans. He did not respond to calls for comment.

Although the farm bill is usually considered “must-pass” by many lawmakers, it is currently facing pushback because of controversy surrounding other parts of the measure, mainly language that would add additional work requirements to the food stamp program.

Still, the focus on association health plans won’t go away.

The plans — coupled with another Trump administration move to make short-term insurance more widely available — could draw healthier people out of the ACA markets, leaving the pool of beneficiaries with higher percentages of people who need medical care. And that, some say, could drive up premiums for those who remain.

The National Association of Insurance Commissioners, for example, has warned that association plans “threaten the stability of the small group market” and “provide inadequate benefits and insufficient protection to consumers.”

Actuaries have made similar arguments.

Others are concerned about the idea of the government providing funding for such plans.

“We have reams of experience with AHPs that have gone belly up … and the notion that we should put taxpayer money into them is irresponsible,” said Georgetown University’s Corlette.

She was referring to the industry’s mixed track record with plans. Some have served members well, but other plans have been marked by solvency problems that left consumers on the hook with unpaid medical bills or were investigated for providing little or no coverage for such things as chemotherapy or doctor office visits.

It’s not fair to simply focus on the failures, countered attorney Christopher Condeluci, who served as tax and benefits counsel to the Senate Finance Committee and now advises private clients, some of whom are interested in association plans.

“Some AHPs were not successful,” he agreed. “But there’s arguably more examples of AHPs that work. The trouble is everyone focuses on the negative.”

Although the GOP generally supports association plans, using taxpayer funds to help start them could prove problematic for some conservatives in Congress.

Many Republican lawmakers expressed concerns about the use of tens of millions of taxpayer dollars to start insurance co-ops that were part of the ACA, most of which failed.

“The hard-earned tax dollars collected from working Americans, sitting at Treasury right now, are not venture capital, said Rep. Kevin Brady (R-Texas) at a subcommittee hearing in November 2015. Currently, Brady is chairman of the powerful House Ways and Means Committee.

The provision could also be popular in rural areas.

“We think it’s a good idea,” said Rob Robertson, chief administrator for the Nebraska Farm Bureau Federation, whose group is considering sponsoring one.

About half of his members, Robertson said, have a spouse working a non-farm job, mainly for insurance coverage. Of those who buy their own plan, some are facing astronomical premiums and are looking for relief.

“I can’t think of any sector that is affected more by the huge premium increases under Obamacare than farmers and ranchers,” he said.

The farm bill — including the AHP provision — was approved by the House Committee on Agriculture in mid-April, and is currently awaiting floor consideration. Meanwhile, a final rule on the Trump AHP rule, which has drawn more than 900 comments from supporters and opponents, could be issued as early as this summer.

 

 

Payer trade groups slam short-term health plan proposal

https://www.healthcaredive.com/news/payer-trade-groups-slam-short-term-health-plan-proposal/521941/

 

More organizations, including Aetna and the American Medical Association, submitted comments on the proposed rule Monday.

Dive Brief:

  • The Alliance of Community Health Plans (ACHP) and America’s Health Insurance Plans (AHIP) both slammed CMS’ proposal to expand short-term, limited duration (STLD) insurance plans, saying the proposed rule would undermine key consumer protections, lead to higher premiums in the individual market and jeopardize market stability.
  • The proposed rule, pushed by the Trump administration as a way to increase access to cheaper plan alternatives and sidestep the Affordable Care Act, would allow consumers to purchase plans for up to 12 months that do not adhere to federal rules for individual health insurance. STLD plans can charge those with pre-existing conditions more and may not cover ACA essential health benefits such as prescription drug coverage.
  • The insurance lobbies argued that other policy mechanisms would be more effective at improving the individual health insurance market. AHIP pointed to increasing 1332 state waiver flexibility and the adoption of regulations aimed at preventing improper steering of Medicare and Medicaid consumers into the individual market, and ACHP advocated for the creation of a federal reinsurance program as more effective ways to promote affordable coverage.

Dive Insight:

The comments are indicative that many insurers are hesitant to back health plans that lack the consumer protections the ACA put into place due to a fear such plans would destabilize the individual market. Monday is the last day to submit comments on the rule.

new Kaiser Family Foundation brief notes that many middle-income people not shielded by premium subsidies in the individual market would likely see premium costs increase. Combined with the individual mandate penalty being zeroed out, the effort to increase STLD plans could result in fewer individuals enrolled in the ACA market, adversely impacting its stability.

“Short-term plans were designed for consumers to use as temporary, stop-gap measures when moving between plans – not as long-term replacements for health insurance,” ACHP CEO Ceci Connolly said in a statement. “A broad, stable risk pool is crucial for providing affordable coverage and care. ACHP believes that other policy options, such as reinsurance, would be far more effective at promoting high-quality, affordable coverage and care for all Americans.”

ACHP argued the proposed rule should not be finalized, saying the current status-quo limit of 90 days should be maintained.

AHIP called for any final rule to limit the duration of STLD plans to six months, adding that the plans should be required to have a plain-language disclosure that the plans should not be considered comprehensive health insurance. The group argued that the effective date of any final rule should come no sooner than Jan. 1, 2020.

“As the Departments advance policies to expand access to lower-cost coverage choices for a subgroup of consumers, it is critical to improve the affordability of comprehensive coverage options for all Americans, regardless of health status,” Matthew Eyles, AHIP COO, wrote in the group’s comment.

But major insurer Aetna, which left AHIP in 2016, said in its comment STLD plans “can be a valuable option for many consumers.”

The insurer argued that such plans must be transparent with disclosure language, limit any look-back period for pre-existing conditions to 12 months and define a minimum floor of benefits including inpatient hospital services, physician services, mental health and substance abuse services and one annual physical and annual well-woman visit before the deductible.

A group of Senate Democrats were among those asking for the rule to not be finalized, arguing it “could increase costs and reduce access to quality coverage for millions of Americans, harm people with pre-existing conditions, and force premium increases on older Americans.”

The American Medical Association also echoed the insurance lobby’s concern, saying STLD plans would endanger the coverage gains of the past decade and destabilize the market. AMA argued the administration should withdraw the proposed rule, saying it is “a step in the wrong direction and will lead to a proliferation of inadequate health insurance policies in the market.”

A joint comment of 21 consumer advocates, including March of Dimes and the American Cancer Society Cancer Action Network, also called for withdrawing the proposal.

PhRMA voiced concern in its comment over the lack of prescription drug coverage in STLD plans, citing an analysis that found than 71% of such plans do not cover outpatient prescription drugs. “If consumers can renew these plans for an extended period, it increases the chances that consumers may find themselves diagnosed with a new condition that can be effectively treated by an innovative drug at a time when they are covered by a short-term plan that does not cover prescriptions drugs,” PhRMA wrote.