Trump administration appeals association health plan ruling

https://www.fiercehealthcare.com/payer/dept-labor-defends-rights-small-businesses-to-expanded-health-plans?mkt_tok=eyJpIjoiTXpCbFpXWXpPR1JtTTJSayIsInQiOiIyUWdwd0NuaU9YSUFYcmg1UnlDUm84Tk4yXC8weWpLOG5hT0lXWHJSRjIzMllDUFZmU05XSFpKWmRrQ3R0NjhPV3VSbk5KTFVYbEdPMXZmMHF1Q0JRbCtRNzZzSWFPV1Y2N1hnMmpRVlNtS1wvNmRZSE1YREZnbUNLM3ZnMXE2ejhBIn0%3D&mrkid=959610

Gavel court room lawsuit judge

The Trump administration will appeal a judge’s ruling that struck down much of its rule expanding association health plans (AHPs).

The rule made it easier for an association of employers to establish an employee welfare plan—regulated under the Employee Retirement Income Security Act (ERISA) and the Affordable Care Act—as a single employer plan. In other words, small employers can work together with others in their industry or geographic area to purchase a larger health plan.

The Department of Labor filed a notice of appeal (PDF) Friday.

Eleven states and the District of Columbia filed a lawsuit saying that the definition of “employer” in ERISA was not reasonable. A federal district court agreed and set aside regulations for qualifying associations, saying that the Labor Department failed to put a limit on the types of associations that can qualify to sponsor an AHP.

“This appeal is welcomed by associations across the country who have invested their time, money and reputation to launch health plans under the 2018 regulation,” Kev Coleman, president and founder of AssociationHealthPlans.com, said in a statement. “This regulation marked a watershed in health policy inasmuch as it corrected a basic unfairness existing in health coverage costs between small companies and large companies.”

Critics, meanwhile, argue the plans offer skimpy coverage that can leave consumers at risk.

Currently, there are an estimated 30,000 small-business employees and their dependents using these plans. According to a 2019 healthcare survey by AssociationHealthPlans.com, four out of five respondents supported small businesses working together to offer large company health insurance plans.

In Congress, Sens. Chuck Grassley, R-Iowa, and Joni Ernst, R-Iowa, joined Sen. Mike Enzi, R-Wyoming, in introducing legislation to prevent small business employees from losing their healthcare coverage. The legislation would ensure a pathway for small businesses to offer AHPs under the Labor Department’s final rule.

 

 

 

 

Obamacare fight obscures America’s real health care crisis: Money

https://www.politico.com/story/2019/04/03/obamacare-health-care-crisis-1314382

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The ceaseless battle over the 2010 law has made it difficult to address the high cost of American health care.

The Obamacare wars have ignored what really drives American anxiety about health care: Medical costs are decimating family budgets and turning the U.S. health system into a runaway $3.7 trillion behemoth.

Poll after poll shows that cost is the number one issue in health care for American voters, but to a large extent, both parties are still mired in partisan battles over other aspects of Obamacare – most notably how to protect people with pre-existing conditions and how to make insurance more affordable, particularly for people who buy coverage on their own.

That leaves American health care consumers with high premiums, big deductibles and skyrocketing out-of-pocket costs for drugs and other services. Neither party has a long-term solution — and the renewed fight over Obamacare that burst out over the past 10 days has made compromise even more elusive.

Democrats want to improve the 2010 health law, with more subsidies that shift costs to the taxpayer. Republicans are creating lower-cost alternatives to Obamacare, which means shifting costs to older and sicker people.

Neither approach gets at the underlying problem — reducing costs for both ordinary people and the health care burden on the overall U.S. economy.

Senate HELP Committee chair Lamar Alexander, the retiring Tennessee Republican with a reputation for deal-making, has reached out to think tanks and health care professionals in an attempt to refocus the debate, saying the interminable fights about the Affordable Care Act have “put the spotlight in the wrong place.”

“The hard truth is that we will never get the cost of health insurance down until we get the cost of health care down,” Alexander wrote, soliciting advice for a comprehensive effort on costs he wants to start by summer.

But given the partisanship around health care — and the fact there have been so many similar outreaches over the years for ideas, white papers and commissions — it’s hard to detect momentum. Truly figuring how to fix anything as vast, complex and politically charged as health care is difficult. Any serious effort will create winners and losers, some of whom are well-protected by powerful K Street lobbies.

And the health care spending conversation itself gets muddled. People’s actual health care bills aren’t always top of mind in Washington.

“Congress is looking at federal budgets. Experts are looking at national health spending and the GDP and value. And the American people look at their own out-of-pocket health care costs and the impact it has on family budgets,” said Drew Altman, the president and CEO of the Kaiser Family Foundation, which extensively tracks public attitudes on health.

But Congress tends to tinker around the edges — and feud over Obamacare.

“We’re doing nothing. Nothing. We’re heading toward the waterfall,” said former CBO director Doug Elmendorf, now the dean of the Harvard Kennedy School, who sees the political warfare over the ACA as a “lost decade,” given the high stakes for the nation’s economic health.

The solutions championed by the experts — a mix of pricing policies, addressing America’s changing demographics, delivering care more efficiently, creating the right incentives for people to use the right care and the smarter use of high-cost new technologies — are different than what the public would prescribe. The most recent POLITICO-Harvard T.H. Chan School of Public Health poll found the public basically wants lower prices, but not a lot of changes to how — or how much — they consume health care, other than spending more on prevention.

Lawmakers are looking at how to start chipping away at high drug prices, or fix “surprise” medical bills that hit insured people who end up with an out-of-network doctor even when they’re at an in-network hospital. Neither effort is insignificant, and both are bipartisan. While those steps would help lower Americans’ medical bills, health economists say they won’t do enough to reverse the overall spending trajectory.

Drug costs and surprise bills, which patients have to pay directly, “have been a way the public glimpses true health care costs,” said Melinda Buntin, chair of the Department of Health Policy at Vanderbilt University School of Medicine. “That information about how high these bills and these charges can be has raised awareness of health care costs — but it has people focused only on that part of the solution.”

And given that President Donald Trump has put Obamacare back in the headlines, the health law will keep sucking up an outsized share of Washington’s oxygen until and quite likely beyond the 2020 elections.

Just in the last week, the Justice Department urged the courts to throw out Obamacare entirely, two courts separately tossed key administration policies on Medicaid and small business health plans, and Trump himself declared he wants the GOP to be the “party of health care.” Facing renewed political pressure over the party’s missing Obamacare replacement plan, Trump last week promised Republicans would devise a grand plan to fix it. He backtracked days later and said it would be part of his second-term agenda.

Democrats say Trump’s ongoing assaults on the ACA makes it harder to address the big picture questions of cost, value and quality. “That’s unfortunately our state of play right now,” said Rep. Raul Ruiz (D-Calif.). “Basic health care needs are being attacked and threatened to be taken away, so we have to defend that.”

The ACA isn’t exactly popular; more than half the country now has a favorable view of it, but it’s still divisive. But for Republicans and Democrats alike, the new POLITICO-Harvard poll found the focus was squarely on health care prices — the cost of drugs, insurance, hospitals and doctors, in that order.

The Republicans’ big ideas have been to encourage less expensive health insurance plans, which are cheaper because they don’t include the comprehensive benefits under Obamacare. That may or may not be a good idea for the young and healthy, but it undoubtedly shifts the costs to the older and sicker. The GOP has also supported spending hundreds of millions less each year on Medicaid, which serves low-income people — but if the federal government pays less, state governments, hospitals and families will pay more.

Last week, courts blocked rules in two states that required many Medicaid enrollees to work in order to keep their health benefits, and also nixed Trump’s expansion of association health plans, which let trade groups and businesses offer coverage that doesn’t include all the benefits required under the ACA.

House Democrats last week introduced a package of bills that would boost subsidies in the Obamacare markets and extend that financial assistance to more middle-class people. The legislation would also help states stabilize their insurance markets — something that the Trump administration has also helped some states do through programs backstopping health insurers’ large costs.

These ideas may also bring down some people’s out-of-pocket costs, which indirectly lets taxpayers pick up the tab. These steps aren’t meaningless — more people would be covered and stronger Obamacare markets would stabilize premiums — but they aren’t an overall fix.

The progressive wing of the Democratic party backs “Medicare for All,” a brand new health care system that would cover everyone for free, including long-term care for elderly or disabled people. Backers say that the administrative simplicity, fairness, and elimination of the private for-profit insurance industry would pay for much of it.

The idea has moved rapidly from pipe dream to mainstream, but big questions remain even among some sympathetic Democrats about financing and some of the economic assumptions, including about how much of a role private insurance plays in Medicare today, and how much Medicare puts some of its costs onto other payers. Already a political stretch, the idea would face a lot more economic vetting, too.

The experts, as well as a smattering of politicians, define the health cost crisis more broadly: what the country spends. Health care inflation has moderated in recent years; backers of the Affordable Care Act say the law has contributed to that. But health spending is still growing faster than the overall economy. CMS actuaries said this winter that if current trends continue, national health expenditures would approach nearly $6 trillion by 2027 — and health care’s share of GDP would go from 17.9 percent in 2017 to 19.4 percent by 2027. There aren’t a lot of health economists who’d call that sustainable.

And ironically, the big fixes favored by the health policy experts — the ones that Alexander is collecting but most politicians are ignoring — might address many of the problems that keep aggravating U.S. politics. If there were rational prices that reflected the actual value of care provided for specific episodes of illness and treatment, instead of the fragmented system that largely pays for each service provided to patients, then no medical bill would be a surprise, noted Mark McClellan, who was both FDA and CMS chief under the President George W. Bush and now runs the Duke-Margolis Center for Health Policy.

“But taking those steps take time and will be challenging,” McClellan noted. “And they’ll be resisted by a lot of entrenched forces.”

 

 

 

Trump admin now backs elimination of ACA in court

https://www.healthcaredive.com/news/trump-admin-now-backs-elimination-of-aca-in-court/551319/

UPDATED: AHA blasted the decision, calling it “unprecedented and unsupported” by law or facts and warned it would lead to repeal of Medicaid expansion and gut protections for those with pre-existing conditions.

Dive Brief:

  • The Trump administration has reversed its stance on the Affordable Care Act, arguing in a court filing Monday that the entire law should be eliminated instead of just removing provisions protecting people with preexisting conditions.
  • The move came hours after Democratic attorneys general defending the ACA filed their brief arguing that the landmark law is still constitutional even without an effective individual mandate penalty. Both filings are in the Fifth Circuit following an appeal of a Texas judge’s decision from December declaring the law unconstitutional after Congress set the mandate penalty to zero in tax overhaul legislation. That decision was stayed pending appeal.
  • Industry groups lambasted the administration’s about-face. America’s Health Insurance Plans CEO Matt Eyles said in a statement the decision was, like the Texas ruling, “misguided and wrong.” He added the payer lobby “will continue to engage on this issue as it continues through the appeals process so we can support and strengthen affordable coverage for every American.” Federation of American Hospitals CEO Chip Kahn said in a statement the decision is “unfortunate but not unexpected considering [the administration’s] long-held views on the health law.”

Dive Insight:

Elimination of the ACA would be a particular blow for some payers that have found increasing profitability in the individual market. Centene and Molina have found success with the exchanges and have expanded their footprints.

It would also put major hospital chains in a bad spot. Companies like HCA, Tenet and Community Health Systems have exposure that could subject them to reduced patient volumes and more bad debt, Leerink analyst Ana Gupte said when the Texas ruling first came down.

Public support for the ACA has gradually increased over the years, and the latest polling from the Kaiser Family Foundation shows about 53% of respondents giving a favorable view and 40% unfavorable. Individual components of the law are even more popular.

The ACA, which just days ago marked its ninth anniversary, brought forth massive change in American healthcare. A repeal of the law would do the same, stripping insurance coverage for as many as 17 million people.

The Trump administration’s new stance presents an intensely stark contrast with the growing field of Democratic presidential contenders, who have shifted the healthcare conversation to the left as the 2020 field shapes up. Candidates have proposed various forms of Medicare for all as well as scaled back versions that still greatly expand government coverage.

It moves the DOJ away from even some Republicans. During last year’s midterms a few GOP candidates said they approved of the ACA’s most popular element — protection for people with preexisting conditions (although voting records didn’t necessarily back them up).

Most Democrats in Congress aren’t fully backing any single-payer model at the moment, but their support for the ACA is strong. Democrats in the House of Representatives are expected to announce a legislative package Tuesday that would strengthen the ACA by eliminating short-term health plans that don’t comply with the law and increasing subsidies for exchange plans.

Since the GOP’s quite public failure to repeal the law two years ago, efforts to do so through Congress have sputtered to nearly a halt. Instead, the Trump administration started chipping away at the law’s provisions. It cut the open enrollment period for ACA plans, as well as the advertising budget for promoting sign-ups, and stopped cost-sharing reduction payments to insurers.

More recently, HHS has bolstered short-term and association health plans that offer cheap but skimpy coverage not in line with ACA requirements. Analysts fear proliferation of these plans could draw young and healthy people away from the exchanges, jeopardizing the stability of the risk pool.

A Democratic-led House panel launched an investigation into short-term plans and is requesting documents from Anthem and UnitedHealth Group, among other companies.

The legal issue at hand is known as severability — the question of whether a single provision of the law, in this case the individual mandate, becoming unenforceable invalidates the entire statute. The mandate was also the key question in the original U.S. Supreme Court ruling allowing the ACA to move forward.

The high court has since lurched to the right, which is notable if the appeal on the Texas ruling reaches that stage, although that would likely be far down the road.

 

 

 

Judge rules Trump AHP expansion unlawful ‘end-run’ around ACA

https://www.healthcaredive.com/news/judge-rules-trump-ahp-expansion-unlawful-end-run-around-aca/551601/

Image result for association health plans

Dive Brief:

  • A federal judge on Thursday struck down a Trump administration expansion of association health plans, which aren’t bound by the requirements of the Affordable Care Act. U.S. District Judge John Bates said the June rule from the Department of Labor that loosened restrictions on what groups could band together to offer AHPs “is clearly an end-run around the ACA.”
  • The ruling stems from a lawsuit 11 states and the District of Columbia filed to challenge the DOL rule. It comes the same week the Trump administration stepped up its attacks against the ACA, arguing in a court filing Monday the law should be eliminated in its entirety following a Texas judge’s decision the act is unconstitutional without the individual mandate penalty.
  • The judge had strong language condemning the administration’s attempt to allow for easier creation and use of AHPs, calling the regulatory change a “magic trick” that allowed for “absurd results” undermining the intent of Congress.

Dive Insight:

The ruling is a blow to the Trump administration’s efforts to circumvent the ACA, which ramped up significantly with the administration’s filing this week seeking complete repeal of the law. Another hit to those efforts came down Wednesday when a different federal judge struck down Medicaid work requirements in Arkansas and Kentucky.

The renewed fight comes as Democrats lining up for a 2020 presidential run are pushing for more progressive policies than have previously gained public traction. Some Democratic contenders are making Medicare for all and other single-payer models a central part of their platforms as healthcare shapes up to be a major issue for the next presidential election.

Experts have argued extended use of AHPs could siphon away young and healthy people looking for minimum coverage at a lower cost. If they choose AHPs they upset the balance on risk pools for more comprehensive coverage. Also, many consumers don’t understand the tradeoff and could be surprised by what isn’t covered when they are in need.

But even though the plans aren’t required to meet ACA standards, some that have formed have been adamant they provide adequate coverage, including the 10 essential ACA benefits. The plans are less obstructive to the regulatory environment than short-term health plans, which have also been granted more leeway under the Trump administration.

Land O’Lakes, for example, which said it was the first to offer an AHP under the more relaxed rules, said its plan covered essential benefits and pre-existing conditions, as well as “broad network coverage.”

The Society of Actuaries has said as many as 10% of people in ACA plans could leave for AHPs, which would also drive up premiums for plans in the individual market. Avalere predicted about 3.2 million people would shift and premiums would rise by 3.5%.

Supporters of AHPs decried the judge’s decision Thursday. Kev Coleman, founder of AssocationHealthPlans.com, said in a statement the ruling will hurt small businesses throughout the country.

“Thousands of employees and family members within the small business community have already enrolled in association health plans — which help lower health care costs — since they first became available last fall,” he said. “They have provided a means by which broad benefits may be accessed at more economical prices. While I do not believe today’s ruling will survive appeal, I believe Judge Bates’ decision is an unnecessary detour on small businesses’ path toward more affordable health coverage.”

 

 

Health Insurance Coverage Eight Years After the ACA

https://www.commonwealthfund.org/publications/issue-briefs/2019/feb/health-insurance-coverage-eight-years-after-aca

Fewer Uninsured Americans and Shorter Coverage Gaps, But More Underinsured

What does health insurance coverage look like for Americans today, more than eight years after the Affordable Care Act’s passage? In this brief, we present findings from the Commonwealth Fund’s latest Biennial Health Insurance Survey to assess the extent and quality of coverage for U.S. working-age adults. Conducted since 2001, the survey uses three measures to gauge the adequacy of people’s coverage:

  • whether or not they have insurance
  • if they have insurance, whether they have experienced a gap in their coverage in the prior year
  • whether high out-of-pocket health care costs and deductibles are causing them to be underinsured, despite having continuous coverage throughout the year.

As the findings highlighted below show, the greatest deterioration in the quality and comprehensiveness of coverage has occurred among people in employer plans. More than half of Americans under age 65 — about 158 million people — get their health insurance through an employer, while about one-quarter either have a plan purchased through the individual insurance market or are enrolled in Medicaid.1Although the ACA has expanded and improved coverage options for people without access to a job-based health plan, the law largely left the employer market alone.2

Survey Highlights

  • Today, 45 percent of U.S. adults ages 19 to 64 are inadequately insured — nearly the same as in 2010 — though important shifts have taken place.
  • Compared to 2010, many fewer adults are uninsured today, and the duration of coverage gaps people experience has shortened significantly.
  • Despite actions by the Trump administration and Congress to weaken the ACA, the adult uninsured rate was 12.4 percent in 2018 in this survey, statistically unchanged from the last time we fielded the survey in 2016.
  • More people who have coverage are underinsured now than in 2010, with the greatest increase occurring among those in employer plans.
  • People who are underinsured or spend any time uninsured report cost-related problems getting care and difficulty paying medical bills at at higher rates than those with continuous, adequate coverage.
  • Federal and state governments could enact policies to extend the ACA’s health coverage gains and improve the cost protection provided by individual-market and employer plans.

The 2018 Commonwealth Fund Biennial Heath Insurance Survey included a nationally representative sample of 4,225 adults ages 19 to 64. SSRS conducted the telephone survey between June 27 and November 11, 2018.3 (See “How We Conducted This Study” for more detail.)

WHO IS UNDERINSURED?

In this analysis, we use a measure of underinsurance that accounts for an insured adult’s reported out-of-pocket costs over the course of a year, not including insurance premiums, as well as his or her plan deductible. (The measure was first used in the Commonwealth Fund’s 2003 Biennial Health Insurance Survey.*) These actual expenditures and the potential risk of expenditures, as represented by the deductible, are then compared with household income. Specifically, we consider people who are insured all year to be underinsured if:

  • their out-of-pocket costs, excluding premiums, over the prior 12 months are equal to 10 percent or more of household income; or
  • their out-of-pocket costs, excluding premiums, over the prior 12 months are equal to 5 percent or more of household income for individuals living under 200 percent of the federal poverty level ($24,120 for an individual or $49,200 for a family of four); or
  • their deductible constitutes 5 percent or more of household income.

The out-of-pocket cost component of the measure is only triggered if a person uses his or her plan to obtain health care. The deductible component provides an indicator of the financial protection the plan offers and the risk of incurring costs before someone gets health care. The definition does not include other dimensions of someone’s health plan that might leave them potentially exposed to costs, such as copayments or uncovered services. It therefore provides a conservative measure of underinsurance in the United States.

Compared to 2010, when the ACA became law, fewer people today are uninsured, but more people are underinsured. Of the 194 million U.S. adults ages 19 to 64 in 2018, an estimated 87 million, or 45 percent, were inadequately insured (see Tables 1 and 2).

Despite actions by the Trump administration and Congress to weaken the ACA, our survey found no statistically significant change in the adult uninsured rate by late 2018 compared to 2016 (Table 3). This finding is consistent with recent federal surveys, but other private surveys (including other Commonwealth Fund surveys) have found small increases in uninsured rates since 2016 (see “Changes in U.S. Uninsured Rates Since 2013”).

While there has been no change since 2010, statistically speaking, in the proportion of people who are insured now but have experienced a recent time without coverage, these reported gaps are of much shorter duration on average than they were before the ACA. In 2018, 61 percent of people who reported a coverage gap said it has lasted for six months or less, compared to 31 percent who said they had been uninsured for a year or longer. This is nearly a reverse of what it was like in 2012, two years before the ACA’s major coverage expansions. In that year, 57 percent of adults with a coverage gap reported it was for a year or longer, while one-third said it was a shorter gap.

There also has been some improvement in long-term uninsured rates. Among adults who were uninsured at the time of the survey, 54 percent reported they had been without coverage for more than two years, down from 72 percent before the ACA coverage expansions went into effect. The share of those who had been uninsured for six months or less climbed to 20 percent, nearly double the rate prior to the coverage expansions.

Of people who were insured continuously throughout 2018, an estimated 44 million were underinsured because of high out-of-pocket costs and deductibles (Table 1). This is up from an estimated 29 million in 2010 (data not shown). The most likely to be underinsured are people who buy plans on their own through the individual market including the marketplaces. However, the greatest growth in the number of underinsured adults is occurring among those in employer health plans.

WHY ARE INSURED AMERICANS SPENDING SO MUCH OF THEIR INCOME ON HEALTH CARE COSTS?

Several factors may be contributing to high underinsured rates among adults in individual market plans and rising rates in employer plans:

  1. Although the Affordable Care Act’s reforms to the individual market have provided consumers with greater protection against health care costs, many moderate-income Americans have not seen gains. The ACA’s essential health benefits package, cost-sharing reductions for lower- income families, and out-of-pocket cost limits have helped make health care more affordable for millions of Americans. But while the cost-sharing reductions have been particularly important in lowering deductibles and copayments for people with incomes under 250 percent of the poverty level (about $62,000 for a family of four), about half of people who purchase marketplace plans, and all of those buying plans directly from insurance companies, do not have them.4
  2. The bans against insurers excluding people from coverage because of a preexisting condition and rating based on health status have meant that individuals with greater health needs, and thus higher costs, are now able to get health insurance in the individual market. Not surprisingly, the survey data show that people with individual market coverage are somewhat more likely to have health problems than they were in 2010, which means they also have higher costs.
  3. While plans in the employer market historically have provided greater cost protection than plans in the individual market, businesses have tried to hold down premium growth by asking workers to shoulder an increasing share of health costs, particularly in the form of higher deductibles.5 While the ACA’s employer mandate imposed a minimum coverage requirement on large companies, the requirement amounts to just 60 percent of typical person’s overall costs. This leaves the potential for high plan deductibles and copayments.
  4. Growth in Americans’ incomes has not kept pace with growth in health care costs. Even when health costs rise more slowly, they can take an increasingly larger bite out of incomes.

It is well documented that people who gained coverage under the ACA’s expansions have better access to health care as a result.6 This has led to overall improvement in health care access, as indicated by multiple surveys.7 In 2014, the year the ACA’s major coverage expansions went into effect, the share of adults in our survey who said that cost prevented them from getting health care that they needed, such as prescription medication, dropped significantly (Table 4). But there has been no significant improvement since then.

The lack of continued improvement in overall access to care nationally reflects the fact that coverage gains have plateaued, and underinsured rates have climbed. People who experience any time uninsured are more likely than any other group to delay getting care because of cost (Table 5). And among people with coverage all year, those who were underinsured reported cost-related delays in getting care at nearly double the rate of those who were not underinsured.

There was modest but significant improvement following the ACA’s coverage expansions in the proportion of all U.S. adults who reported having difficulty paying their medical bills or said they were paying off medical debt over time (Table 4). Federal surveys have found similar improvements.8 However, those gains have stalled.

Inadequate insurance coverage leaves people exposed to high health care costs, and these expenses can quickly turn into medical debt. More than half of uninsured adults and insured adults who have had a coverage gap reported that they had had problems paying medical bills or were paying off medical debt over time (Table 6). Among people who had continuous insurance coverage, the rate of medical bill and debt problems is nearly twice as high for the underinsured as it is for people who are not underinsured.

Having continuous coverage makes a significant difference in whether people have a regular source of care, get timely preventive care, or receive recommended cancer screenings. Adults with coverage gaps or those who were uninsured when they responded to the survey were the least likely to have gotten preventive care and cancer screenings in the recommended time frame.

Being underinsured, however, does not seem to reduce the likelihood of having a usual source of care or receiving timely preventive care or cancer screens — provided a person has continuous coverage. This is likely because the ACA requires insurers and employers to cover recommended preventive care and cancer screens without cost-sharing. Even prior to the ACA, a majority of employer plans provided predeductible coverage of preventive services.9

Conclusion and Policy Implications

U.S. working-age adults are significantly more likely to have health insurance since the ACA became law in 2010. But the improvement in uninsured rates has stalled. In addition, more people have health plans that fail to adequately protect them from health care costs, with the fastest deterioration in cost protection occurring in the employer market. The ACA made only minor changes to employer plans, and the erosion in cost protection has taken a bite out of the progress made in Americans’ health coverage since the law’s enactment.

Both the federal government and the states, however, have the ability to extend the law’s coverage gains and improve the cost protection of both individual-market and employer plans. Here is a short list of policy options:

  • Expand Medicaid without restrictions. The 2018 midterm elections moved as many as five states closer to joining the 32 states that, along with the District of Columbia, have expanded eligibility for Medicaid under the ACA.10 As many as 300,000 people may ultimately gain coverage as a result.11 But, encouraged by the Trump administration, several states are imposing work requirements on people eligible for Medicaid — a move that could reverse these coverage gains. So far, the U.S. Department of Health and Human Services (HHS) has approved similar work-requirement waivers in seven states and is considering applications from at least seven more. Arkansas imposed a work requirement last June, and, to date, more than 18,000 adults have lost their insurance coverage as a result.
  • Ban or place limits on short-term health plans and other insurance that doesn’t comply with the ACA. The Trump administration loosened regulations on short-term plans that don’t comply with the ACA, potentially leaving people who enroll in them exposed to high costs and insurance fraud. These plans also will draw healthier people out of the marketplaces, increasing premiums for those who remain and federal costs of premium subsidies. Twenty-three states have banned or placed limits on short-term insurance policies. Some lawmakers have proposed a federal ban.
  • Reinsurance, either state or federal. The ACA’s reinsurance program was effective in lowering marketplace premiums. After it expired in 2017, several states implemented their own reinsurance programs.12  Alaska’s program reduced premiums by 20 percent in 2018. These lower costs particularly help people whose incomes are too high to qualify for ACA premium tax credits. More states are seeking federal approval to run programs in their states. Several congressional bills have proposed a federal reinsurance program.
  • Reinstate outreach and navigator funding for the 2020 open-enrollment period. The administration has nearly eliminated funding for advertising and assistance to help people enroll in marketplace plans.13 Research has found that both activities are effective in increasing enrollment.14 Some lawmakers have proposed reinstatingthis funding.
  • Lift the 400-percent-of-poverty cap on eligibility for marketplace tax credits. This action would help people with income exceeding $100,000 (for a family of four) better afford marketplace plans. The tax credits work by capping the amount people pay toward their premiums at 9.86 percent. Lifting the cap has a built in phase out: as income rises, fewer people qualify, since premiums consume an increasingly smaller share of incomes. RAND researchers estimate that this policy change would increase enrollment by 2 million and lower marketplace premiums by as much as 4 percent as healthier people enroll. It would cost the federal government an estimated $10 billion annually.15 Legislation has been introduced to lift the cap.
  • Make premium contributions for individual market plans fully tax deductible. People who are self-employed are already allowed to do this.16
  • Fix the so-called family coverage glitch. People with employer premium expenses that exceed 9.86 percent of their income are eligible for marketplace subsidies, which trigger a federal tax penalty for their employers. There’s a catch: this provision applies only to single-person policies, leaving many middle-income families caught in the “family coverage glitch.” Congress could lower many families’ premiums by pegging unaffordable coverage in employer plans to family policies instead of single policies.17

REDUCE COVERAGE GAPS

  • Inform the public about their options. People who lose coverage during the year are eligible for special enrollment periods for ACA marketplace coverage. Those eligible for Medicaid can sign up at any time. But research indicates that many people who lose employer coverage do not use these options.18 The federal government, the states, and employers could increase awareness of insurance options outside the open-enrollment periods through advertising and education.
  • Reduce churn in Medicaid. Research shows that over a two-year period, one-quarter of Medicaid beneficiaries leave the program and become uninsured.19 Many do so because of administrative barriers.20 By imposing work requirements, as some states are doing, this involuntary disenrollment is likely to get worse. To help people stay continuously covered, the federal government and the states could consider simplifying and streamlining the enrollment and reenrollment processes.
  • Extend the marketplace open-enrollment period. The current open-enrollment period lasts just 45 days. Six states that run their own marketplaces have longer periods, some by as much as an additional 45 days. Other states, as well as the federal marketplace, could extend their enrollment periods as well.

IMPROVE INDIVIDUAL-MARKET PLANS’ COST PROTECTIONS

  • Fund and extend the cost-sharing reduction subsidies. The Trump administration eliminated payments to insurers for offering plans with lower deductibles and copayments. Insurers, which by law must still offer reduced-cost plans, are making up the lost revenue by raising premiums. But this fix, while benefiting enrollees who are eligible for premium tax credits, has distorted both insurer pricing and consumer choice.21 In addition, it is unknown whether the administration’s support for the fix will continue in the future, creating uncertainty for insurers.22 Congress could reinstate the payments to insurers and consider making the plans available to people with higher earnings.
  • Increase the number of services excluded from the deductible.Most plans sold in the individual market exclude certain services from the deductible, such as primary care visits and certain prescriptions.23As the survey data suggest, these types of exclusions appear to be important in ensuring access to preventive care among people who have coverage but are underinsured. In 2016, HHS provided a standardized plan option for insurers that excluded eight health services — including mental health and substance-use disorder outpatient visits and most prescription drugs — from the deductible at the silver and gold level.24 The Trump administration eliminated the option in 2018. Congress could make these exceptions mandatory for all plans.

IMPROVE EMPLOYER PLANS’ COST PROTECTIONS

  • Increase the ACA’s minimum level of coverage. Under the ACA, people in employer plans may become eligible for marketplace tax credits if the actuarial value of their plan is less than 60 percent, meaning that under 60 percent of health care costs, on average, are covered. Congress could increase this to the 70 percent standard of silver-level marketplace plans, or even higher.
  • Require deductible exclusions. Congress could require employers to increase the number of services that are covered before someone meets their deductible. Most employer plans exclude at least some services from their deductibles.25 Congress could specify a minimum set of exclusions for employer plans that might resemble the standardized-choice options that once existed for ACA plans.
  • Refundable tax credits for high out-of-pocket costs. Congress could make refundable tax credits available to help insured Americans pay for qualifying out-of-pocket costs that exceed a certain percentage of their income.26
  • Protect consumers from surprise medical bills. Several states have passed laws that protect patients and their families from unexpected medical bills, generally from out-of-network providers.27A bipartisan group of U.S. senators has proposed federal legislation to protect consumers, including people enrolled in employer and individual-market plans.

Health care costs are primarily what’s driving growth in premiums across all health insurance markets. Employers and insurers have kept premiums down by increasing consumers’ deductibles and other cost-sharing, which in turn is making more people underinsured. This means that policy options like the ones we’ve highlighted above will need to be paired with efforts to slow medical spending. These could include changing how health care is organized and providers are paid to achieve greater value for health care dollars and better health outcomes.28 The government also could tackle rising prescription drug costs29 and use antitrust laws to combat the growing concentration of insurer and provider markets.30

 

 

Ads for short-term plans may be confusing

https://www.rwjf.org/content/dam/farm/reports/issue_briefs/2019/rwjf451339?utm_source=newsletter&utm_medium=email&utm_campaign=newsletter_axiosvitals&stream=top

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People Googling for ACA coverage often found results that were actually trying to sell them skimpier short-term health plans, according to a report from Robert Wood Johnson Foundation and the Urban Institute.

Why it matters: Consumer confusion is one of the things regulators worried about most when the Trump administration expanded access to “short-term” coverage.

  • For some people, especially those who do only need coverage for a short time, one of these more bare-bones options might be a better choice than the comprehensive policies sold under the ACA.
  • But if you don’t realize you’re signing up for a plan with incredibly limited coverage and the right to drop you once you get sick, you could be in for a catastrophic surprise.
  • That’s why HHS mandated a disclosure statement about the plans’ limited benefits.

Details: Researchers Googled terms including “cheap health insurance” and “Obamacare plans” and looked at the first 4 results — which are usually ads.

  • Sites that included short-term plans “dominated the results,” though some of those sites also sell ACA-compliant plans. Sites varied in how much information they provided about the differences between the two types of plans.

 

ACA lawsuit puts GOP in an awkward position

https://www.axios.com/affordable-care-act-lawsuit-republicans-2c0aff0e-e870-49af-a15e-554d34d3ad62.html

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A lawsuit that threatens to kill the entire Affordable Care Act could be a political disaster for the GOP, but most Republicans aren’t trying to stop it — and some openly want it to succeed.

Between the lines: The GOP just lost the House to Democrats who campaigned heavily on health care, particularly protecting people with pre-existing conditions, but the party’s base still isn’t ready to accept the ACA as the law of the land.

The big picture: A district judge ruled last month that the ACA’s individual mandate is unconstitutional and that the whole law must fall along with it. That decision is being appealed.

  • A victory for the Republican attorneys general who filed the lawsuit — or for the Trump administration’s position — would likely cause millions of people with pre-existing conditions to lose their coverage or see their costs skyrocket.

Some Republicans want the lawsuit to go away.

  • Rep. Greg Walden, ranking member of the Energy and Commerce Committee, supports fully repealing the ACA’s individual mandate, which the 2017 tax law nullified. That’s what sparked this lawsuit, and formal repeal would likely put the legal challenge to rest.
  • Sen. Susan Collins laughed when I asked her whether she hopes the plaintiffs win the case. “No. What a question,” she said.

But other Republicans say they see an opportunity.

  • If the lawsuit prevails, “it means that we could rebuild and make sure that we have a health care system that is going to ensure that individuals are in charge of their health care,” Rep. Cathy McMorris Rodgers said.
  • Sen. David Perdue said that “of course” he wants the challengers to win, which would “give us an opportunity to get at the real problem, and that is the cost side of health care.”
  • Sen. Shelley Moore Capito said she views the lawsuit “as an opportunity for us to assure pre-existing conditions and make sure that we fix some of the broken problems,” but that she doesn’t know if it’d be good if the plaintiffs win.

The bottom line: “The longer we’re talking about preexisting conditions, the longer we’re losing. We need to focus on a message that can win us voters in 2020. The debate of preexisting conditions was a stone-cold loser for us in 2018,” said Matt Gorman, the communications director for House Republicans’ campaign arm during the 2018 cycle.