Thursday, June 29, 2017

The party of Cost Sharing Inflation

When House Republicans sued the Obama administration in 2014 to stop federal payments to health insurers for Cost Sharing Reduction subsidies in the ACA marketplace, the simple goal was sabotage: use any tool that came to hand to hobble the markets.  (That goes as well for refusing to appropriate the budgeted funds for CSR.)

At the same time, I suggest today in a healthinsurance.org piece that will be out this morning, this particular bit of legal vandalism made ideological sense, in that Republicans do not believe in cost sharing reduction. They believe in cost sharing inflation: if each of us pays a higher percentage of our medical costs, we'll demand better prices for care, and prices will go down.

This ideology is fully expressed in the BCRA, which asks low income people to swap out Medicaid coverage, or CSR-enhanced marketplace coverage at AV 94% or 87%, for coverage at AV 58%. That's a feature, not a bug. Hope you'll take a look

Thursday, June 22, 2017

Trading Medicaid coverage for high deductible private market coverage

The Senate version of the AHCA, the Orwellianly named Better Care Reconciliation Act, does even more fundamental damage to the U.S. healthcare system than the House bill. While it phases out the ACA Medicaid expansion more slowly, stepping down the enhanced federal contribution over several years, it imposes even tighter per capita caps on Medicaid, limiting annual growth to the straight CPI after 2024. The damage to Medicaid will be continuous in perpetuity, barring further legislation.

The BCRA does toss a bone to the dis-insured poor by offering private-market subsidies to those who are shut out of Medicaid. Under the ACA, in the 31 states plus D.C. that accepted the law's Medicaid expansion (rendered optional to states by the Supreme Court), anyone whose household income is below  139% of the Federal Poverty Level (FPL) qualifies for Medicaid, and so not for subsidies in the private plan marketplace (with one class of exceptions*).  In states that refused the expansion -- a possibility not envisioned by the law's drafters -- eligibility for Marketplace subsidies begins at 100% FPL, and those below that level are left out in the cold -- because their state's governors and legislatures wanted it that way.

The BCRA allows people with incomes in 0-100% FPL range to buy a "benchmark" plan for 2% of income, and those in 100-133% FPL range** to buy one for no more than 2.5% of income:

Quick thoughts before the bill hits the tape

The Senate iteration of the AHCA is due out in about 40 minutes. A couple of quick thoughts, brought into focus by David Anderson's "how to read the bill" cheat sheet:

1) Back-loaded per capita caps imposed on Medicaid can theoretically be repealed before they kick in. But if the bill's massive tax cuts are not similarly back-loaded (to improve the CBO score), new tax increases would have to be passed in concert with repeal.

2. The more Republicans fiddle around with and publicly fight over individual market subsidies and rules, the easier they'll likely find it to pass the massive cuts to Medicaid that are the bill's core feature.

3.I can't shake the feeling that McConnell has some trick up his sleeve to make the CBO score a positive shock that helps sweep the moderates into the yes column. A "positive shock" might be a forecast of,, say, a reduction of a mere 8 million in the number of people with insurance by 2026, which Republicans can explain away as a result of personal choices (no mandate coercion) or CBO error.

4. What could that shock be? A cap on the tax exclusion for employer-sponsored insurance? Hard to believe. A little coup within CBO? Don't know how that work. Something else? Nothing?

So much for idle speculation....

Wednesday, June 21, 2017

AHCA would increase New Jersey's uninsured population by 540,000: NJPP Report

540,000 fewer people in New Jersey will have health insurance by 2026 under the American Health Care Act (AHCA) than under current law, according to an updated analysis by Raymond Castro of New Jersey Policy Perspective. The update takes into account the May 24 cost estimate by the Congressional Budget Office (CBO) of the amended AHCA that passed the House on May 4.

Should the AHCA become law, NJPP forecasts:
  • The state uninsurance rate would increase by 50%, from 9.8% to 14.7% in 2026.
  • The uninsurance rate would double in Rodney Frelinghuysen's Congressional district, and more than double in Tom MacArthur's.
  • Almost all of the 562,000 New Jerseyans covered by the ACA Medicaid expansion would lose Medicaid coverage, and about two thirds of them would remain uninsured.
  • About one in ten New Jersey adults would lose Medicaid coverage.
  • The state would lose $28 billion in federal funding over ten years -- $21 billion in Medicaid funding, and $7 billion in reduced Marketplace subsidies.
  • The wealthiest 5 percent of NJ households would receive $13 billion in tax cuts over 10 years.
  • About 100,000 New Jerseyans would lose coverage in the individual market through reduction in subsidies for premiums and out-of-pocket costs.

Tuesday, June 20, 2017

Amend the Senatized AHCA

To help Democrats introduce thousands of amendments before the (Senatized) AHCA comes to a vote, Indivisible is inviting all of us to add our own stories to their amendment*; they'll ask  our senators to make their constituents' testimonials part of the Congressional Record. Contribute here!

With Democratic senators being tasked with offering thousands of amendments, I thought I'd propose a few. Some are mutually exclusive, some would cost money, some would only work under current law, some may be unworkable. Brainstormer's licence...
  1. Nothing in this bill shall be construed to render anyone who was eligible for Medicaid under prior law ineligible.

  2. Congress shall not cap the federal contribution to Medicaid by any formula that reduces the Federal Medical Assistance Percentage (FMAP) in effect prior to enactment of this legislation.

  3. Any insurer that participates in a state's nongroup health insurance market must offer plans on the state Marketplace, in every area where it sells off-Marketplace.

Saturday, June 17, 2017

An American road to single payer

Ezra Klein offers an astute political forecast:
...if Republicans leave Obamacare gutted and the political arguments that led to it in ruins, there’s not going to be a constituency for rebuilding it when Democrats win back power.

Instead, they’ll pass what many of them wanted to pass in the first place: a heavily subsidized buy-in program for Medicare or Medicaid, funded by a tax increase on the rich. A policy like that would fit smoothly through the 51-vote reconciliation process, and it will satisfy an angry party seeking the fastest, most defensible path to restoring the Affordable Care Act’s coverage gains.
A few thoughts:

1. If a Medicaid income-adjusted buy-in were offered only to nonelderly who lack access to employer-sponsored insurance or other government programs, it shouldn't require more funding than the ACA marketplace. OTOH, if the AHCA has passed, Democrats will need to replace the revenue provided by the ACA taxes Republicans will have repealed (close to $900 billion over ten years, rather than the $600+ billion Klein cites, if you include revenue from the repealed ACA mandates).

2. If a buy-in were subsequently offered to employers -- perhaps starting with small employers -- that buy-in would amount to a voluntary payroll tax.

Friday, June 16, 2017

The Medicaid Dismemberment Act

Over at healthinsurance.org, I've made a case that the AHCA is not simply -- or even primarily -- an ACA repeal bill. It's a Medicaid dismemberment bill.  That goes for the Senate variant in progress as well.  Furthermore:
The degree of damage to be wrought by the legislation's various spending reductions is almost the inverse of where media emphasis falls;
and finally
the damage Republicans will likely do to the individual market is dwarfed by the damage they will certainly do (if they pass anything) to Medicaid. Thus all the high drama over medical underwriting and EHBs continues to serve as a smokescreen for Medicaid's dismemberment.
I rank the bill's three primary means of doing violence to existing parts of our healthcare system. Hope you'll take a look. 

Monday, June 12, 2017

Senate "moderates" promised long ago to support the ACA repeal bill in progress

I keep reading that Senators Capito and Portman and Heller, relative Republican "moderates" from states that have embraced the ACA Medicaid expansion,  have reversed themselves by signaling willingness to repeal the expansion if the repeal timeline is stretched out.

Capito may have made some contradictory noises over the last few months, occasionally indicating that she does not want to see the expansion repealed.

But look again at the letter to McConnell that Capito and Portman signed onto just before the House repeal bill, the AHCA, was released.  That letter, which was read as defense of the Medicaid expansion, demanded
that any health care replacement provide states with a stable transition period and the opportunity to gradually phase-in their populations to any new Medicaid financing structure.
In Republican-speak, that means expanding the timeline in which enhanced federal funding for the Medicaid expansion population is phased out -- as the Senate bill will do. I examined the letter's consistency with the course the Senate is undertaking now in more detail in this post.

Saturday, June 10, 2017

Senate Republicans may outspend the ACA on individual market subsidies -- at Medicaid's expense

While Republican senators working on ACA repeal will doubtless screw up the individual market for health insurance, they are not planning to spend less money on it. All of their spending cuts -- needed to pay for tax cuts -- will come out of Medicaid's hide. Since the Medicaid expansion they're planning to repeal is a roaring success, they're following the House in diverting everyone's attention with emotionally fraught questions about individual market structure.

According to Vox's Dylan Scott, Senate Republicans are near agreement on the basic outline of their Medicaid cuts -- they will roll back the expansion over more or less years and impose per capita caps on all Medicaid spending, as Ryan's AHCA does. As for the individual market:
There’s broad agreement to increase the money the House bill would spend subsidizing Americans who buy insurance on the individual market. That increase would probably improve, at least somewhat, the Congressional Budget Office’s projection that the House bill would cause 23 million fewer Americans to have health insurance a decade from now.
In fact, any improvement to the AHCA individual market design and funding will improve CBO's uninsured estimate for the AHCA only marginally. In CBO's forecast, the individual market will insure only two million fewer people under the AHCA than under current law ten years from now (though enrollees will be wealthier, younger and more skimpily covered, and most of the roughly 7 million ACA enrollees with incomes under 200% FPL will likely be priced out).

Wednesday, June 07, 2017

Senate exterminators gear up to expel Medicaid expansion beneficiaries

Earlier this spring, we had a squirrel in our eaves. An exterminator installed a one-way door, leaving the squirrel free to rattle about until circumstances drove her outside. Which of course they did, after a few days -- maybe three, maybe seven.

Way back in mid-January, when the AHCA was just an exhalation from Paul Ryan's college memories, this promise from Texas Senator John Cornyn seemed startling and impressive:
When Cornyn was asked if he was concerned about people who’ve benefited from Medicaid expansion losing coverage, he said it was a shared concern.

“Were all concerned, but it ain’t going to happen,” Cornyn said. “Will you write that down… It ain’t gonna happen.”

As Republican moderates cave on Medicaid cuts, what can Dems do?

As I feared back in March, the "moderate" Republicans in the Senate who profess concern about plans to repeal the ACA Medicaid expansion and impose per capita caps on federal funding for Medicaid are going squish. They'll settle for slowing repeal of the expansion rather than stopping it, and perhaps for some partial easing of the per capita caps, such as exempting coverage for the disabled.

Now as in March, Republican senators in states that have benefited from the expansion speak as if repeal of the expansion and a steady erosion in federal funding for all Medicaid programs is a natural disaster that they must help their constituents cope with, rather than their own free choice to inflict suffering on vulnerable people to fund tax cuts for the wealthy.

Here's Bill Cassidy of Louisiana, until now the strongest defender among Republican senators of maintaining ACA-level funding, speaking to Matt Fuller and Sam Stein of the Huffington Post. Over 300,000 Louisianians have gained Medicaid coverage since incoming governor John Bel Edwards implemented the expansion, beginning July 1, 2016.

Monday, June 05, 2017

AHCA Reduces Federal Spending on Private Health Insurance by....4%

[originally posted May 30]  The Republican bill rejiggers subsidies for the individual market but barely reduces them on net. Almost all the real cuts are in Medicaid     

Hours before House Republicans introduced the American Health Care Act, their ACA partial repeal/replace bill, on March 6, former CMS director Andy Slavitt tweeted:
That remains true. In fact, it's truer than has been fully recognized.

The basic math of the AHCA, according to the Congressional Budget Office (CBO), is a $992 billion* reduction in federal revenue over ten years, offset by a $1.1 trillion reduction in spending on health insurance benefits. Most of that spending cut is in Medicaid, reduced by $834 billion over ten years, according to the updated CBO analysis released on May 24.

The rest of the spending reduction ostensibly comes from cuts in subsidies to private insurance. But that reduction is largely illusory -- - because two of the major tax cuts included in the AHCA subsidize privately purchased health insurance and medical care.

Sunday, June 04, 2017

The senescence of the United States

About five years ago my father-in-law, then in his mid-80s, of sound mind, gave my wife power of attorney and turned over management of his financial affairs, after 60 years of capably managing them himself.  "That's how it often works," his financial adviser told us. "They're very hands-on, and then suddenly they let go."

That came to mind as I read this Times editorial board review of Trump's "leadership":
In short order, Mr. Trump has pulled out of the Trans-Pacific Partnership, ceding leadership on trade in Asia to China; refused to reaffirm the mutual defense commitment that has been the bedrock of trans-Atlantic security for half a century, forcing America’s European allies to think about dealing with threats like Russia on their own; and abandoned a landmark agreement on climate change signed by 190-plus other nations, ceding leadership on the issue to Europe and China, and, in the bargain, forfeiting the rewards of participating in a worldwide clean energy economy that the agreement will bring.
I'm not thinking of Trump here, but of the United States. Maybe, collectively, we got tired, our faculties sapped by 40 years of galloping inequality and risk shift, as we fell behind much of the developed world in education, opportunity, health care and income growth and outpaced our peers (all afflicted to some degree) in letting the superrich capture a growing share of national wealth and, concomitantly, power. The portion of our population mired in job loss, income stagnation, family and community disintegration and right-wing gaslighting reached critical mass.

Thursday, June 01, 2017

Alternative Facts, Alternative Realities Edition of Health Wonk Review

In a divided country and interconnected world, it often feels as if reality is fracturing before our eyes. When a spokesperson for the President asserts the administration's right to promulgate "alternative facts," it's a major challenge to convince a critical mass of people that verifiable facts are in fact verified. On the plus side, as ever more of the previously voiceless find or create a forum, we have the chance to see how differently a given law or trend may affect different people -- not alternative facts, but variant effects.  This week's Health Wonk blog reflects that variety, as well as battles over fact and interpretation.

First up is Harold Pollack in healthinsurance.org, tilting against alternative facts of the pure variety -- a.k.a. lies. In You can only lie about policy in Washington D.C., Pollack takes on four of Paul Ryan's assertions about the AHCA (delivered in short space) that the Congressional Budget Office (CBO) analysis of the bill directly contradict.  Most of them boil down to claims that the AHCA will make insurance and healthcare more affordable to more people, but Ryan also avers for the umpteenth time that the ACA marketplace is collapsing under its own weight.

At InsureBlog, conversely, Patrick Paule takes on CBO the old fashioned way -- with a factual critique rather than a go-team cry of fake news. Paule asserts "four reasons the CBO score is flawed."noting that CBO  1) pits AHCA individual market enrollment against CBO's 2016 baseline for the ACA, which overestimated enrollment by 4 million; 2) assumes that under current law, more states would embrace the ACA Medicaid expansion; 3) assumes (thanks to the MacArthur Amendment, allowing states to waive ACA coverage rules) that some health plan enrollees won't have comprehensive coverage, but does not define what coverage must be provided to make the cut; and 4) does not delve into the implications of its forecast that millions will voluntarily drop insurance in the absence of a mandate to obtain it.

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