Better Care Reconciliation Act – R&R – Reachout and Rebuild

It’s Time For an Apology from the GOP

David Posnett — Mon, 04 Sep 2017 18:20:31 +0000

Published in The East Hampton Star

Dear David:

Republicans owe America an apology.

Sadly, we have arrived at a point at which the White House, the political crown jewel that the GOP so ardently sought, is in disarray, which has taken down the GOP-led Congress as well. After making President Obama’s failure its No. 1 priority (so much so that it became an obsession), the GOP worked hard to get a rich white guy – any rich white guy – to take the mantle of leadership after Obama. In pursuing its obsession, it abandoned its stated principles and abandoned those it promises to serve.

Republicans refused to negotiate honestly when Democrats spent months seeking Republican support for the Affordable Care Act. Then they tried repeatedly over seven-plus years to take away that health care – not, as it turns out because they had a better idea, but because it was Obama’s idea. Even worse, for seventy-plus years Congress has worked to create, and then perfect (or try to) a safety net that would protect working class America and the disadvantaged among us from financial and social ruin. The current Republican credo, adhered to from the top of the ticket to its most local echelons, holds dear the destruction of those protections.

Yet, in the last election cycle, all one heard from GOP candidates was the mantra that working class America had been “forgotten” and only they were the ones capable of repairing this so-called injustice. Decrying the political opposition by fomenting race-based paranoia allowed these candidates to camouflage their real agenda. It is not the furtherance of the “forgotten,” it is the furtherance of unscrupulous greed.

Help the “forgotten”? Not Trump. The policies that have actually been implemented by the Trump administration, with the help of a Republican Congress, reflect a disdain for ordinary working-class Americans. Shortly after Trump took office, he and the GOP-led Congress rejected numerous Obama-era regulations that were actually designed to support workers, including rules barring worker discrimination, rules designed to enhance workers’ wages and rules enhancing workplace protection, such as barring companies with a history wage, labor or workplace safety violations laws from receiving federal contracts. And this is just the tip of the iceberg.

So, the GOP agenda has no intention of protecting the “forgotten.” Its true colors are shown in its efforts to rip away healthcare, savage the social safety net and, in so doing, leaving the “forgotten” to fend for themselves. Under the GOP agenda, the “forgotten” will soon be the “trampled.”

The sad truth behind the GOP camouflage is that millions of hard-working Americans drank the GOP Kool-Aid, believing that the party truly cared for them and would make good on promises to deliver wealth, improve healthcare and preserve the all-important safety net protecting these folks. For some, it was hard not to be seduced by Trump and his GOP cohorts.

However, like everyone else who has succumbed to Trump’s wiles, these voters too have been had.

And for this, the GOP owes America an apology. And the lesson for voters from all this is that old adage: Fool me once, shame on you; fool me twice, shame on me. Let’s not be fooled again, either in our local elections this year or next year when the GOP Congress has to face the music. Trust not the GOP Kool-Aid another time.

Sincerely,

Bruce Colbath

This is How Trump Can Destroy Obamacare

David Posnett — Sat, 22 Jul 2017 09:41:48 +0000

From Countable

On Tuesday, the seven-year quest by Republicans to repeal and replace the Affordable Care Act, popularly known as Obamacare, appeared to come to an end, and President Trump responded to the setback by vowing to “let Obamacare fail.”

“It’ll be a lot easier,” Trump said at the White House.

“We’re not going to own it. I’m not going to own it. I can tell you the Republicans are not going to own it. We’ll let Obamacare fail, and then the Democrats are going to come to us.”

With Obamacare entrenched in many states, and numerous governors (and, apparently, senators) supportive of the legislation, what can the Trump Administration actually do to try and tank Obamacare?

END INDIVIDUAL MANDATE

On Wednesday, the nonpartisan Congressional Budget Office (CBO) estimated what would happen if Obamacare were to be repealed without a replacement. The CBO predicts 32 million people would lose insurance by 2026, including 17 million by next year. The CBO also estimated that, compared to current law, premiums would nearly double by 2026. Medicaid expansion would end in 2020.

Much of this was based on the elimination of the individual mandate, which requires all Americans sign up for health care, regardless of age. By repealing the individual mandate, those who would most likely remain enrolled in health care would be those Americans with an immediate health care need: primarily older and sicker Americans. That demographic is the costliest to cover, so this in turn would cause insurers to have to dramatically raise their rates. The Trump administration needs Congress to repeal the individual mandate, but it can direct the Internal Revenue Service (IRS) to soften its enforcement of the mandate.

WITHHOLD PAYMENTS DUE

This is one of the most lethal strategies, and has been referred to as the “Nuclear Option” for killing Obamacare.

Insurance companies are owed billions of dollars in “cost-sharing reduction” payments. Under the ACA, insurance companies reduced the deductibles of low-income customers, with the understanding that the government would reimburse them. According to the Kaiser Family Foundation, in 2016 the federal government paid an estimated $7 billion in cost-sharing payments, on behalf of 6.4 million marketplace customers.

For months, President Trump has been threatening to withhold this money. In response, insurers have claimed they’re already raising 2018 premiums. Some insurers have also warned they may pull out of additional counties if they can’t be guaranteed reimbursement. (There are even a handful of counties that have no individual insurers lined up for 2018.)

Anthem, one of the nation’s leading healthcare providers, decided to exit various markets in June because of all these unknowns. In a statement, the company said their concerns include “continual changes in federal operations, rules and guidance” and “an increasing lack of overall predictability.”

FAIL TO PROMOTE OPEN ENROLLMENT PERIOD

With few exceptions, individuals can only change their insurance, or sign up for new insurance, during the marketplace’s open enrollment period. President Obama made it a priority to spread the word about open enrollment and get people signing up. This included commercials, Tweets, and offbeat interviews, including the one on Between Two Ferns.

By refusing to promote the exchanges, or directing people to sign up, the Trump Administration could cause a steep decline in new enrollees. It’s a more roundabout way of attacking the individual mandate, but one that will cause insurers to take a hit nonetheless.

While Obamacare may or may not be the “disaster” Trump has claimed it to be on numerous occasions, it is in a precarious position: if the ACA is a game of Jenga, Trump certainly has ways to remove some key blocks to help it tumble.

Should the GOP preemptively work with the Democrats on the ACA? Or should Republicans, as Trump suggested, “let Obamacare fail, and then the Democrats are going to come to us”? Tell your reps to save our healthcare.

Millions More Uninsured Could Impact Health Of Those With Insurance, Too

David Posnett — Fri, 14 Jul 2017 14:30:51 +0000

KAISER HEALTH NEWS — REPEAL & REPLACE WATCH

By Julie Rovner July 14, 2017

Neonatal intensive care, trauma care or burn care are among the services that could be hard to access in communities with high uninsured rates.

Much has been written lately about how individuals’ health could suffer if they lose insurance under the health proposals circulating in the U.S. House and Senate. But there is another consequence: creating millions more people without insurance could also impact the health of people who remain insured.

“We know that communities with higher rates of uninsurance have worse access to care for those with Medicare or private insurance,” said John Ayanian, director of the Institute for Healthcare Policy and Innovation at the University of Michigan. And if either of the GOP proposals now under consideration becomes law, he said, “it’s very likely we would go back to some of those same problems we had a decade ago with high rates of uninsurance.”

The Congressional Budget Office has estimated that either the bill passed by the House or the one under consideration in the Senate could result in more than 20 million more Americans without insurance over the next decade.

Ayanian was part of an expert panel from the nonpartisan National Academy of Medicine that examined the implications of being uninsured in a series of studies from 2001 to 2009. An entire report looked solely at the spillover impact of large numbers of uninsured people on those around them. “The Committee believes it both mistaken and dangerous to assume that the persistence of a sizable uninsured population in the United States harms only those who are uninsured,” said the report.

That is mostly because it is difficult for health providers to maintain services in areas with large numbers of patients who cannot pay for care. “Those communities are less attractive for physicians and other health care providers to locate,” said Ayanian. “That affects access to care for everyone,” he said, particularly for critical but high-cost services like trauma care, burn care, and neonatal intensive care.

The potential is not merely theoretical. Hospitals in sparsely populated areas, particularly in states that did not opt to expand the Medicaid program, have been cutting back services like maternity care or closing altogether in recent years. These are the same parts of the country that voted for President Donald Trump by large margins.

The impact is not just on availability of services. A 2007 study from researchers at the University of Pennsylvania in the journal Health Affairs found that in areas with many uninsured people, the quality of care was lower as well. Primary care doctors “reported that the higher the proportion of uninsured people in their community, the less likely they are to be able to refer their patients to high-quality specialists,” found the researchers. “Specialists also reported that the higher the community uninsurance rate, the less able they are to deliver high-quality care to their patients,” the study said.

That spillover effect even extends beyond access to health care itself, according to a new report from The Commonwealth Fund. Researchers from George Washington University found that if the House-passed health bill were to become law, nearly 1.5 million jobs could be lost over the next decade.

“We’re talking about a net funding loss to states of millions of dollars,” said Leighton Ku, the study’s lead author. “What this means is that states will have higher needs, less revenue to pay for services, and at the same time the federal government is putting less money into Medicaid,” he said. “So it all adds up to a great revenue crunch that’s similar to the Great Recession” of the past decade.

While most of the job loss would be in health care, other jobs would be impacted too, he said.

For example, health care workers who lose jobs will then purchase fewer goods and services, affecting the bottom line of local businesses. Health care facilities that were planning to expand might not, affecting the construction industry. And the impact could even cross state lines, said Ku. “We might see fewer people going to Disney World,” he said, because people who lose their jobs would lack money to take vacations.

Kaiser Health News, a nonprofit health newsroom whose stories appear in news outlets nationwide, is an editorially independent part of the Kaiser Family Foundation.

The new Senate health care bill — and the return of preexisting conditions — explained

David Posnett — Fri, 14 Jul 2017 13:14:09 +0000

Posted on Vox.com

Updated by Sarah Kliff sarah@vox.com Jul 13, 2017, 1:18pm EDT

Senate Republicans introduced a revised version of their bill to repeal and replace the Affordable Care Act on Thursday, one that would allow insurers to once again deny coverage based on preexisting conditions, and to charge higher rates to sick people.

The bill would keep most of the Affordable Care Act’s tax increases but repeal one aimed specifically at medical device manufacturers. It would deeply cut the Medicaid program, making few changes to the bill’s first draft.

Even with these new changes, the general structure of the bill stays the same from its original draft, which was itself largely similar to the bill that passed the House in the spring.

Healthier and higher-income Americans would benefit from the changes in the new Republican plan, while low-income and sick Americans would be disadvantaged. It would create a two-track system for health coverage on the individual market. One would offer cheaper, deregulated health plans, which healthy people would likely flock to. The other would include comprehensive plans governed by Obamacare’s regulations, which would cost more and mostly be used by less healthy people and those with preexisting conditions — a system experts expect would function like a poorly funded high-risk pool.

Deductibles would almost certainly rise under the Republican plan, as would overall costs for low- and middle-income Americans. Individual market participants would have more options to purchase catastrophic coverage, an option likely to appeal to those with few health care costs.

Experts expect the changes will do little to change the Congressional Budget Office’s estimates that 22 million Americans would lose coverage under the proposal.

You can see a full explainer on the Senate bill here, which will be updated shortly with the latest information. This post focuses on the changes made in the July 13 revision.

Health insurers could bring back preexisting conditions, offer skimpy health plans

Perhaps the biggest policy change in this revision is an amendment to allow health insurers to deny coverage based on preexisting conditions and cover few benefits, so long as they offer a comprehensive plan that covers the Affordable Care Act’s mandated benefits.

These deregulated health plans would be allowed to charge sick people higher premiums or simply deny them coverage. They would not have to pay by the rules of the preexisting condition ban that the Affordable Care Act sets up (Phil Klein at the Washington Examiner has a summary of the rules they’d be exempted from here). Instead, they would operate much like health plans in the pre-Affordable Care Act market, offering cheap rates to consumers they believe would have low medical bills.

Health policy experts know exactly how this would play out: Healthy people would pick the skimpier plan, while the comprehensive plan would essentially become a high-risk pool for sicker Americans.

Individual market enrollees would likely game the system too. A couple expecting a baby, for example, would be expected to upgrade to the plan that covers maternity care for one year before returning to the cheaper plan they had before.

“Someone with chronic illness, they’re going to end up wanting to buy the more comprehensive coverage,” says Joe Antos, a health policy expert with the conservative American Enterprise Institute. “This means that people with those kinds of illnesses will end up paying more. Even if they receive a federal subsidy, they will likely see higher cost sharing.”

As Antos notes, individuals who want to buy the comprehensive plan would receive federal tax credits to do so. They could not use the tax credits for the deregulated plans.

But even after that financial help, these people would still face significant out-of-pocket costs, including high deductibles and premiums. The Congressional Budget Office estimates, for example, that a 64-year-old individual earning $11,500 and receiving tax credits would still need to pay $4,800 to purchase that plan.

The updated Senate bill also allows individuals to use tax credits to purchase catastrophic coverage

There is a quieter way the Senate bill lets people buy skimpier plans: by using their tax credits to purchase catastrophic plans.

This is a practice the Affordable Care Act barred, as the law’s drafters wanted to encourage enrollment in more generous options. But the Senate bill would allow the tax credits to be used for these high-deductible plans. These plans would only include three primary care visits before individuals hit their deductibles and have to pay their medical bills out of pocket. The plans could cover a wide array of health benefits, including maternity and mental health, but, again, coverage would only kick in after paying a large deductible.

The updated bill would let individuals use pre-tax dollars to pay for their premiums

An estimated 29 percent of American workers are enrolled in tax-advantaged health savings accounts (HSA), that allow them to use pre-tax dollars to cover things like copayments and coinsurance.

The Senate bill would allow HSA dollars to go toward premiums as well, meaning someone in the individual market could use pre-tax dollars to pay their monthly bill. This practice was not allowed under the Affordable Care Act.

Liberals have typically opposed this provision, which they argue would mainly benefit wealthy Americans who have the money to contribute to an HSA in the first place. This provision would have fewer benefits for low-income Americans, who rely on tax credits to finance the lion’s share of their premium.

The Senate bill gets rid of most Obamacare tax cuts — but keeps two on high earners in place

The Senate’s revised health care bill still includes an estimated $657 billion in tax cuts by eliminating the health law’s taxes on the medical industry and its individual mandate penalty for not carrying coverage, among other changes.

It does continue two taxes aimed at wealthy Americans: a 0.9 percent investment tax and a 3.8 percent Medicare payroll surtax. Keeping these two taxes in place would net the government an estimated $231 billion in revenue over the next decade, and eliminate some of the benefits high-income Americans would have received under the first draft.

These new taxes, however, do not seem to be fully spent on enhancing the law’s benefits. The new bill includes a $45 billion program to combat opioid abuse as well as $70 billion to offset the costs of expensive patients (this is in addition to the $112 billion already appropriated for that purpose in the first version of the bill). The inclusion of these taxes does not appear to lead to any additional funding of the Medicaid program or offset any of the cuts to the tax credits in the individual market.

The Senate bill still makes very deep cuts to Medicaid

The Senate bill is notable in what it doesn’t change: namely, significant cuts to the Medicaid program. While moderate senators have protested these cuts (particularly those who represent Medicaid expansion states), these provisions of the Senate bill remain largely intact.

One of the main ways Obamacare increased insurance coverage was by expanding the Medicaid program to cover millions more low-income Americans. Prior to the health law, the entitlement was restricted to specific groups of low-income Americans (pregnant women, for example, and the blind and disabled).

Obamacare opened up the program to anyone below 138 percent of the poverty line (about $15,000 for an individual) in the 31 states (plus the District of Columbia) that opted to participate.

The Medicaid expansion gave states generous funding to cover this particular population. Typically, the federal government picks up about half the cost of the Medicaid program and states cover the rest.

For Medicaid expansion, however, the federal government currently pays 95 percent of the costs — an especially good deal for states meant to assuage their budget concerns during the original Obamacare debate.

The Senate bill would begin ratcheting down that Medicaid expansion funding in 2021. By 2024, states would get that same match rate they typically get to cover other populations. In 2021, for example, the match rate would fall to 90 percent, then decline in steps to 75 percent by 2023.

The Congressional Budget Office has projected in a separate analysis that this policy change would mean no additional states expand Medicaid — and that some current expansion states would drop out of the program, resulting in millions losing coverage.

“CBO anticipates some states that have already expanded their Medicaid programs would no longer offer that coverage,” the agency wrote in its analysis of the House bill, which makes a similar change.

The Senate bill would cut the rest of the Medicaid program too

There are significant changes to Medicaid in the Senate bill outside of the expansion too. This bill would convert Medicaid to a “per capita cap” system, where states would get a lump sum from the federal government for each enrollee. Or states would have the opportunity of a block grant — a sum of money untethered from the number of people involved.

This is very different from current Medicaid funding. Right now the federal government has an open-ended commitment to paying all of a Medicaid enrollee’s bills, regardless of how high they go.

The Senate bill would set different amounts for different groups of people. It envisions, for example, higher payments to cover Medicaid enrollees who are disabled (and tend to have higher costs) than for Medicaid enrollees who are kids (generally healthy with lower costs).

The rate at which these payments grow is also important. The Senate bill would have the funding growth tethered to the Medical Consumer Price Index plus 1 percentage point through 2025, and then switch to the urban Consumer Price Index. Analysis of this type of proposal suggests this change would amount to funding cuts for Medicaid, as the program’s spending typically goes up faster than these growth rates.

Association Health Plans for Small Groups and Self-Employed Individuals Could Be Negatively Impacted under the Better Care Reconciliation Act

David Posnett — Wed, 12 Jul 2017 15:24:40 +0000

KAISER HEALTH NEWS

Jun 30, 2017 | Karen Pollitz and Gary Claxton

The Senate Better Care Reconciliation Act (BCRA), a proposal to repeal and replace the Affordable Care Act (ACA), includes a provision to create new association health plan options for small employers and self-employed individuals. These so-called “small business health plans” (SBHPs) would be considered part of the large group market, which has different rules than the small group market. In particular, the ACA requirement that premiums cannot vary based on health status does not apply in the large group market. Neither does the requirement for policies to cover ten categories of essential health benefits. If enacted, this provision would considerably disrupt the small group market because small employers could seek lower rates or less comprehensive coverage in an SBHP when their employees are healthy, but theoretically move back to regular small group market plans if an employee becomes ill or if the group wants more comprehensive benefits. This type of adverse selection could result in significant premium increases and instability in the small group market. The provision could disrupt the non-group market in a similar manner because it would permit self-employed individuals (in states that choose to regulate very small groups of one as small employers) to join SBHPs when they are healthy or want few benefits, but move back to regular non-group coverage if their health or circumstances change.

Background

Under the BCRA, new association health plan options would be available to small employers and to the self-employed in certain states. The bill amends the federal Employee Retirement Income Security Act of 1974 (ERISA) to establish the following rules, standards, and definitions for small business health plans:

Large group market rules apply. A SBHP is defined as a fully insured group health plan, sponsored by a certified entity, and offered by a health insurer in the large group market. Several key requirements for small group market insurers do not apply in the large group market. Insurers in the small group market cannot consider the health or claims of a small group’s employees, and must cover the 10 categories of essential health benefits (though states could waive that requirement under the BCRA). These rules do not apply in the large group market. The BCRA sets no standards for SBHPs in terms of what benefits must be covered or how premiums would be set for small firms that want to participate. For example, the insurer covering the SBHP could medically screen small firms applying, and charge relatively low rates for healthy groups but very high rates for groups with sick employees. In addition, the insurer could consider a group’s health and claims at renewal and give them considerably higher rate increases than other groups. The same practices could apply to self-employed individuals. Small businesses could join and enroll in SBHPs, as could self-employed individuals with no other participating employees (i.e., groups of one) in states that choose to regulate such arrangements as small group health insurance.

Federally regulated. The sponsor of a SBHP must be certified by the Secretary of Labor. Federal certification is deemed approved after 90 days unless the Secretary denies the application for cause. To do business in a state, a certified SBHP must provide written notice of its certification to the insurance regulator in every state in which it will operate. The federal government also has enforcement authority over the business practices of SBHPs. The bill includes broad preemption language stating that federal standards “shall supersede any and all State laws insofar as they may now or hereafter preclude a health insurance issuer from offering health insurance coverage in connection with a [certified] small business health plan.” This appears to prohibit a state from requiring that a SBHP be regulated as small group coverage and may preempt other state insurance rules, as well. The Secretary is required to coordinate with the State in which a particular SBHP is domiciled regarding the exercise of federal authority to certify a SBHP and enforce federal standards. The Secretary is also required to ensure that only one domicile state will be recognized with respect to any particular SBHP. The bill does not provide that the rules of the domicile state will supersede the laws of other states.

Nondiscrimination standards. The entity that sponsors a SBHP must be organized for a purpose other than providing health benefits, although it appears that providing health benefits could be the primary purpose of the organization. For example, a sponsoring entity could be a bona fide trade association, organized primarily for professional or industry-related purposes. Or it could adopt broadly inclusive membership standards to permit virtually any small group or individual to join. In addition, the sponsor of the SBHP is prohibited from conditioning membership on the size of its member groups. The bill does not prohibit a sponsoring entity from conditioning membership on the health status of small businesses; a nondiscrimination provision in the bill states that a requirement not to discriminate against employers and eligible employees is satisfied if the SBHP makes information about all coverage options readily available to any eligible small employer.

Under the BCRA, the SBHP provisions become effective 1 year after the date of enactment and the Secretary of Labor is required to issue implementing regulations no later than 6 months after the date of enactment.

Effects on Small Employers, Self-Employed Persons, and Traditional Markets

The establishment of small business health plans could affect the way health insurance operates for small employers, and could affect the entire small group health insurance market, in several ways:

Premium instability for small businesses and self-employed individuals – Because SBHPs would be able to set premiums for small firm and self-employed members based on health and risk status, it could be possible for SBHP members to obtain lower premiums for coverage as long as their workers and their family members are healthy. However, in the event a covered individual becomes seriously ill or injured, nothing under federal law would prevent the SBHP insurer from raising the premium for that small employer or self-employed individual, even to unaffordable levels. The affected small employer or self-employed person might then try to seek coverage in the traditional small group market or non-group market, where health status rating is prohibited, though as discussed below, premiums there could also become unaffordable.

Increased premiums in traditional small group and non-group markets – Selection of coverage options, based on which market rules are most advantageous at the time, is sometimes called adverse selection. The asymmetry of rules applied to SBHPs and the traditional small group market would tend to segment small employers based on risk, steering more expensive groups to the traditional market and driving up community rated premiums. This could lead to premiums in the traditional small group market becoming much higher for employers who need to seek coverage there. Eventually, the impact of selection could force insurers to stop offering traditional small group coverage because they could not predict the risk of potential enrollees. The SBHPs would also be open to self-employed individuals in states that permit very small groups of one to buy small group coverage, as 14 states did prior to the ACA. In 2014, one in five marketplace consumers was a small business owner or self-employed. As a result, adverse selection from SBHPs could also affect premiums in the individual market.

Lack of clear regulatory authority – The BCRA requires that SBHPs must be fully insured group health plans, suggesting that states would continue to have regulatory authority over the insurance product itself, for example, to apply and enforce state standards related to risk based capital and solvency. However, preemption language in the bill is broad, and does not specify which state laws could still be enforced, including for example, laws relating to qualifications of SBHP sponsoring entities, or the covered benefits or rating practices under such plans. At a minimum, it seems legal challenges could arise if states would try to regulate SBHPs more closely. In the past, in response to federal proposals to create new small group insurance arrangements that would not be subject to all state small group market regulation, the National Association of Insurance Commissioners, the American Academy of Actuaries, and others have raised concerns that market fragmentation and harm to small businesses and consumers could result.

Discussion

The Senate SBHP proposal sets up competing and unequal regulatory regimes for small group health insurance that could undermine the traditional market. It also would potentially increase non-group premiums because healthy self-employed people could leave that market while people with health problems would not qualify for SBHP rates. In addition, small groups and the self-employed could choose less comprehensive policies while they are healthy, but move to more comprehensive plans if their health changed (if they remain available). Such adverse selection could drive up the cost of coverage in these markets, making health insurance less affordable for sick individuals and small groups who would have to rely on them, and potentially not available at all.

Uneven Playing Field: Applying Different Rules to Competing Health Plans

David Posnett — Wed, 12 Jul 2017 00:20:03 +0000

KAISER HEALTH NEWS — Health Reform

Jul 11, 2017 | Karen Pollitz and Anthony Damico

As the Senate considers the Better Care Reconciliation Act (BCRA), a proposal to repeal and replace the Affordable Care Act (ACA), amendments have been discussed to further change private health insurance market rules that apply under current law. Under the BCRA, current law health insurance market rules would still apply: Insurers in the non-group health insurance market are prohibited from turning applicants down or charging higher premiums based on health status and from excluding coverage for pre-existing conditions. In addition, all policies must provide major medical coverage for 10 categories of essential health benefits and must limit the annual out-of-pocket cost sharing (deductibles, co-pays and coinsurance) that people must pay for covered services in network (although states can alter those requirements through waivers).

However, an amendment to the BCRA, suggested by Senator Ted Cruz (R-TX), reportedly would allow insurers in the non-group market to also sell some policies that would not be required to follow all of the ACA market rules. For example, such policies might not have to follow ACA essential health benefit and cost sharing standards. In addition, some reports suggest that insurers would not have to sell these policies to people with health conditions or risks and could vary premiums for them based on the health of applicants.

This brief examines the likely impact of such a change on the stability of coverage offered through non-group markets and on the number of individuals who might be affected.

Impact on Consumers Ineligible for Premium Subsidies

If the BCRA were amended to permit insurers to sell ACA-compliant plans alongside plans that did not follow ACA-benefit standards and/or rating and access rules, the likely result would be that the cost of ACA-compliant plans would skyrocket. The ACA-compliant plans would effectively become a high-risk pool, attracting enrollees when they need costly health benefits – such as maternity care, or drugs to treat cancer or HIV, or therapies to treat mental health and substance abuse disorders – and those with pre-existing conditions who are turned down by non-compliant plans or charged high premiums based on their health. By contrast, non-compliant plans would attract healthier consumers, at least as long as they didn’t need coverage for such benefits. Premiums from the healthier enrollees would not be pooled to help keep the price of compliant plans affordable. As a result, premiums for compliant plans would increase significantly, while premiums for non-compliant plans would be substantially lower (though they would also cover fewer benefits).

The Senate BCRA would continue ACA-like premium tax credits to subsidize the cost of coverage for low-and middle-income individuals. Like the ACA, premium tax credits under the BCRA would be tied to the cost of a benchmark marketplace plan, though the benchmark would have higher patient cost-sharing than under the ACA. Eligibility for premium tax credits would be capped at income of 350% of the federal poverty level (FPL), compared to 400% FPL under current law. Individuals eligible for tax credits would be required to pay a set percentage of their annual income toward a benchmark plan; the premium tax credit amount for each individual would be the difference between the actual cost of the benchmark plan and a person’s required contribution. Under this formula, as under current law, subsidy-eligible people would generally be shielded from annual premium cost increases, which would instead be absorbed by federal premium tax credits.

While people with pre-existing conditions eligible for premium tax credits would be cushioned from premium increases in compliant plans under the Cruz amendment, those ineligible for credits would not be protected.

According to the National Health Interview Survey, approximately 40% of non-group market participants in 2015, or 6.1 million people, had income above 350% FPL. Most of these individuals purchased non-group coverage outside of the marketplace. Under the BCRA, these individuals would not be eligible for premium tax credits.

We further estimate that, among the 6.1 million non-group market participants with incomes of at least 350% FPL, 24% (or about 1.5 million) would have pre-existing conditions that would have been considered automatically deniable by insurers prior to the ACA. These conditions include cancer, diabetes, HIV/AIDS, hepatitis, substance use disorders (including opioid addiction), serious mental illnesses, and pregnancy. (Figure 1)

For these 1.5 million individuals, non-compliant plans would likely either deny coverage outright or charge very high premiums tied to their health. Even if they could obtain coverage in non-compliant plans, it might not cover key benefits, such as maternity care, mental health care, substance use treatment, or prescription drugs, and would not solve the affordability problem.

Among the three-quarters of other market participants with income over 350% FPL, millions would have other types of pre-existing conditions that were not considered automatically declinable prior to ACA, such as high-blood pressure, high cholesterol, asthma, and depression. Many in this group also could see a substantial increase in out-of-pocket spending for medical care that would offset any premium savings associated with less comprehensive policies.

Methods

To calculate nationwide prevalence rates of declinable health conditions, we reviewed the survey responses of nonelderly adults for all question items shown in Methods Table 1 using the CDC’s 2015 National Health Interview Survey (NHIS). Approximately 27% of 18-64 year olds, or 52 million nonelderly adults, reported having at least one of these declinable conditions in response to the 2015 survey. For more details on methods and a list of declinable conditions included in this analysis, see our earlier brief: Pre-existing Conditions and Medical Underwriting in the Individual Insurance Market Prior to the ACA.

The programming code, written using the statistical computing package R, is available upon request for people interested in replicating this approach for their own analysis.

Senate’s health care bill will cost New York’s Medicaid program billions

David Posnett — Tue, 11 Jul 2017 14:59:30 +0000

Posted on Politico

New York was one of only two states to take advantage of the Essential Plan, also known as the Basic Health Plan, a program funded with the Affordable Care Act’s tax credits and cost-sharing subsidies. | Getty

ALBANY — The Senate’s version of the American Health Care Act would cost New York’s Medicaid program billions of dollars over the next decade, putting Albany in the position of having to choose between raising taxes or cutting services and programs for hundreds of thousands.

The bill, which is certain to change before coming to a vote, would also upend New York’s individual health insurance market, likely saddling many with higher deductibles and more expensive premiums.

“The Senate bill presented today, which was crafted behind closed doors by 13 men, would fundamentally harm Americans young and old, do severe damage to a fragile economy, and bankrupt state governments across the country,” Sen. Kirsten Gillibrand said in a statement. “The cuts to Medicaid in particular are galling. … To end the Medicaid expansion created under the Affordable Care Act is a cruel joke.”

The state’s Essential Plan, which enrolls nearly 700,000 New Yorkers in low-cost health insurance plans, likely would not survive in its current form because it relies on federal funding that would disappear. The program provides health insurance for $20 per month to those with incomes between 150 percent and 200 percent of the federal poverty level. Those with incomes below 150 percent of the federal poverty level, who do not qualify for Medicaid, receive health insurance with no premium.

That would, on its own, be enough to severely handicap the Essential Plan but Republicans also propose prohibiting “lawfully present” immigrants from receiving tax credits. In New York, there are a couple of hundred thousand lawfully residing immigrants taking advantage of the Essential Plan. Without their tax credits, the state would have no method for funding their health insurance unless Albany decided to subsidize the insurance without federal help, a multi-billion dollar proposition.

A 2001 state Court of Appeals ruling requires that those residents, known as People Residing Under the Color of Law, receive Medicaid, which the state would once again have to pay for without any help from the federal government. That alone would cost the state $1.19 billion, according to an estimate from the state Department of Health.

On top of that, the Senate bill includes an amendment sponsored by Reps. John Faso and Chris Collins that would effectively prohibit the state from using county taxes to pay for the Medicaid program. That is expected to shift roughly $2.3 billion from county budgets to the state budget, and though it may ease the property tax burden in upstate New York, it will do nothing to ease the budget woes facing Albany in 2019.

The more severe Medicaid cuts would hit between 2020 and 2024, according to the Senate bill, which phases out the enhanced federal match states such as New York received from the federal government because of Obamacare.

In its place, there would be a per-capita cap assigned to each state. The per-capita cap would be based on what a state spent between 2014 and 2017, but high-cost states such as New York would see their per capita reduced by the secretary of Health and Human Services by as much as 2 percent.

Shoppers on the individual insurance market would see the value of their subsidies decrease. The Affordable Care Act pegged subsidies to a silver plan, which has an actuarial value of 70 percent, meaning insurers pay for 70 percent of the costs. The Senate version pegs subsidies to plans with an actuarial value of 58 percent. That will almost certainly mean New Yorkers who rely on subsidies will need to purchase skimpier plans with higher deductibles. Those who wish to buy the equivalent of silver plan will spend more out of their pocket on premiums.

The cutoff for income-based subsidies under the Senate plan is reduced to 350 percent ($42,210 for an individual) of the federal poverty level from 400 percent. Subsidies tied to the federal poverty level always hurt high-cost states such as New York where incomes tend to be higher than average, as does the cost of living. Basically, $43,000 goes a lot further in most other parts of the country so subsidies for health insurance aren’t as needed.

The Senate’s version is also worse for New York hospitals compared to the House version, according to the Greater New York Hospital Association, which pointed out that the House bill repeals the cuts to the Disproportionate Share Hospital program for Medicaid expansion states in 2020. The Senate does not, costing hospitals billions of dollars.

“It’s every bit as bad as the House bill. In some ways, it’s even worse,” Senate Minority Leader Chuck Schumer said Thursday on the floor of the Senate. “The president said the Senate bill needed heart. The way this bill cuts health care is heartless. The president said the House bill was mean. The Senate bill may be meaner.”

The state Department of Health would not provide an estimate of how many people with incomes between 350 and 400 percent of the federal poverty level buy plans on the exchange, although the state does collect income information.

The agency also declined to predict the total cost of the Senate’s bill on New York, or its effects on the Essential Plan, providers or insurers.

Medicaid Cuts Will Drive Up Cost Of Private Coverage, Montana Insurers Say

David Posnett — Mon, 10 Jul 2017 21:55:33 +0000

KAISER HEALTH NEWS — REPEAL & REPLACE WATCH

By Eric Whitney, Montana Public Radio July 10, 2017

From left, Senate Majority Leader Mitch McConnell and Sens. Pat Roberts (R-Kan.) and Steve Daines (R-Mont.) chat before a Republican meeting to discuss the health care bill on June 27. (Nicholas Kamm/AFP/Getty Images)

Montana was among the last states to expand Medicaid, and its Obamacare marketplace has fared reasonably well. It has 50,000 customers, decent competition and no “bare counties,” where no insurers want to sell plans.

The Republicans who make up two-thirds of Montana’s congressional delegation have said they want to repeal the current health care law because it’s causing health insurance markets to “collapse.”

But insurance executives at the companies that sell policies in Montana’s marketplace say that’s not true in the state, and they are concerned that GOP plans to repeal and replace the Affordable Care Act would destabilize a market that is working. Jerry Dworak, the CEO of Montana Health Co-Op, said, “I don’t think that their plan is going to improve health care in the state of Montana. I think just the opposite is going to happen. And I really do think a lot of people are going to get hurt.”

The co-op is one of the three insurance companies that have been selling Montanans coverage at healthcare.gov since it started in 2013. Dworak said it has no plans to leave.

The executives say collapse is a real possibility, though, if some of the GOP’s wish list comes true. First, deep cuts to Medicaid would have ripple effects to everybody with insurance. Todd Lovshin, a vice president at PacificSource Health Plans, said Medicaid expansion means Montana hospitals are now getting paid for taking care of more than 70,000 Montanans who got Medicaid after the state expanded it under the Affordable Care Act.

“All of our hospitals have to take any patient that comes in and serve them. That has to be paid somewhere,” he said. “And if we’re not paying that through Medicaid expansion, those costs have to be borne by someone, and so that will increase the overall cost of medical expenses.”

Hospitals have a legal obligation to examine and stabilize any patient who walks in their door, regardless of whether they have insurance. When hospitals see their unpaid bills stack up, Lovshin said, prices go up for everybody else and insurers have to charge patients who have insurance more to stay afloat.

John Doran, a vice president with Blue Cross and Blue Shield of Montana, the state’s biggest insurer, agreed with that analysis.

Doran also said that problems would likely get worse if the individual mandate goes away. That’s the requirement to have health insurance that Republican health care bills do away with.

“If there’s no mandate, and there’s no incentive for them to buy a health insurance plan, then maybe they won’t,” he said. “The people who need health care the most, and typically have the highest health care costs, are the only ones who are in the marketplace, and that results in higher health care costs, and consequently higher premiums.”

Montanans have been seeing insurance premiums go up, sometimes by more than 50 percent a year. Most people who buy on the exchange get subsidies to help defray the cost, and the co-op’s Dworak said he thinks prices are now starting to stabilize. If the health law isn’t changed, he projects his company’s premiums would go up only 5 percent in 2018.

This story is part of a partnership that includes Montana Public Radio, NPR and Kaiser Health News.

Kaiser Health News, a nonprofit health newsroom whose stories appear in news outlets nationwide, is an editorially independent part of the Kaiser Family Foundation.

Report: BCRA would mean more than 900K healthcare jobs lost

David Posnett — Mon, 10 Jul 2017 21:49:37 +0000

Posted on HealthDive

Les Masterson

July 7, 2017

Dive Brief:

The Senate’s Better Care Reconciliation Act (BCRA) would result in 1.45 million fewer jobs by 2026, according to a new report by The Commonwealth Fund. Healthcare would take a hard hit with 919,000 fewer jobs.
The Commonwealth Fund predicted an additional 753,000 jobs in 2018, but employment numbers would drop sharply after that. It said every state except Hawaii would have fewer jobs and a weaker economy. States that expanded Medicaid would feel the most pain.
The report came out on the same day that the Bureau of Labor Statisticssaid 37,000 healthcare jobs were added in June, up from 20,600 added in May .

Dive Insight:

The Commonwealth Fund said that job losses and lower economic growth would begin in 2020 and deepen in the following years as more people lose health insurance coverage, if the Senate bill were to become law.

The House’s American Health Care Act (AHCA) would cut a similar number of insured Americans, but the BCRA would harm the economy more, according to the report. The Commonwealth Fund estimates the AHCA would result in nearly 1 million lost jobs.

New York, California and Pennsylvania would lose more than 100,000 jobs each. “Twenty-two million Americans will become uninsured under the Better Care Reconciliation Act, and now this research makes it clear that people will also be at risk of losing their jobs and that states’ economies will suffer,” said Sara Collins, vice president for healthcare coverage and access at The Commonwealth Fund.

One reason for the economic problems resulting from the BCRA is the bill’s Medicaid cuts, which would deepen further after 2026. Also, the BCRA’s tax provisions would result in much lower assistance, especially for older Americans, which will result in people not being able to afford high deductibles and result in fewer people enrolling in health plans. Third, the BCRA would reduce the threshold of the medical care deduction from 10% to 7.5%.

Cuts to healthcare jobs would especially harm the economy. Healthcare has been a major driver of job growth in recent years. The Commonwealth Fund predicts healthcare would lose 30,000 jobs in 2018 under the BCRA. Ultimately, 919,000 healthcare jobs would disappear, which is about 1 of every 22 health jobs.

“While our analysis shows other employment sectors grow initially, by 2026 more than half a million jobs are lost in other sectors of the economy, too,” according to The Commonwealth Fund.

Meanwhile, the Bureau of Labor Statistics released the June jobs report Friday, which said there were 37,000 healthcare jobs added in June, with 26,000 in ambulatory care services and 11,700 at hospitals. So far this year, healthcare job growth has slowed. Healthcare has added 24,000 more jobs on average per month so far in 2017 after adding 32,000 on average per month in 2016.

Healthcare has seen some high-profile layoffs in 2017. For instance, NYC Health + Hospitals cut 476 management positions to save $60 million in the next fiscal year after losing $776 million for the first half of 2017 and Brigham and Women’s Hospital offered voluntary buyouts in April to 1,600 workers.

Also, Memorial Hermann, Summa Health and Hallmark Health all recently announced staffing cuts, which they blamed on declining reimbursements, lower admissions and shrinking operating incomes.

The 37,000 new healthcare jobs in June is positive, but the question is whether that trend remain or will growth slip back down to this year’s average.

The Commonwealth Fund’s report will surely get the attention of economics — and senators. Senate leaders are already trying to figure out ways to tweak the BCRA to get enough conservative and moderate support to pass the legislation. Republicans only have a two-vote majority in the Senate and the current bill doesn’t have enough support for passage.

Uncertainty about what bill — if any — will pass is likely a major factor is slowed healthcare job growth. This latest report about jobs losses if the BCRA becomes law will only deepen the opposition against the bill.

It’s Time For Politics To Take A Back Seat To Those They Serve. Let’s Have a Bi-Partisan HealthCare Solution: This Could Be A Start

David Posnett — Fri, 07 Jul 2017 20:30:53 +0000

A liberal think tank just released its own proposal to fix Obamacare

Posted on Vox.com

Jeff Stein Jun 29, 2017, 11:30am EDT

Sen. Tammy Baldwin (D-WI) and dozens of other Senate Democrats hold photos of patients on the Capitol steps. A new proposal from a liberal think-tank could form the basis of Democrats’ response to Obamacare’s problems (Vox/Jeff Stein)

The most influential center-left think tank in DC has a new plan to fix Obamacare — and, perhaps surprisingly, it includes some of the same provisions as the Republican health bill in the Senate.

On Thursday, the Center for American Progress released new legislative text that proposes repairing Obamacare’s exchanges through a mixture of new subsidies to help insurance companies cover their most expensive patients, and lower taxes to encourage insurers to set up shop in under-served markets.

The plan is almost certainly dead on arrival with a Republican caucus that has been bent on dismantling Obamacare for years. But CAP is casting it as a bipartisan solution that could give Republicans a lifeline should Majority Leader Mitch McConnell fail to find the 51 votes to pass his bill — and require Democratic support.

“We are at an inflection point where there’s an opportunity for senators to choose a different path,” said Topher Spiro, one of the report’s authors, in an interview. “But it’s a very small window.”

CAP’s plan to stabilize Obamacare, explained

The CAP plan has three main components — two of which are already included in Senate Republicans’ Better Care Reconciliation Act. (All three components have been floating around health policy circles for a number of years.)

The first involves guaranteeing Obamacare’s cost-sharing reductions, which help make copays and deductibles cheaper for lower-income people who get insurance through Obamacare. Trump threatened to stop making Obamacare’s CSR payments — a move that “destabilized” the markets by making it unclear to insurers if they could count on the payments being there. Both Senate Republicans’ BCRA and the CAP plan would guarantee the CSRs.

The second component is a $15 billion “reinsurance” fund. It calls for giving states federal money to give insurers funding for their most expensive, high-cost enrollees — which Spiro says would in turn reduce premium payments for everyone else on the exchanges. (Spiro also notes that Maine and Alaska — two states with moderate Republican senators — have already adopted similar approaches in their states that have shown signs of success.) Because the reinsurance fund would reduce premium costs, and thus the amount of tax credits the government would have to pay out, Blue Cross Blue Shield Association says the $15 billion fund would only cost the federal government $4 billion.

“It’s pretty well known that a very small percentage of patients drive the vast majority of health care costs. That’s the reasoning behind this solution: If you subsidize those high costs, it will bring premiums down for everyone,” Spiro said.

“And it’s plucked straight from the Senate Republican bill.”

These Republican ideas were put into BCRA in order to ease the blow created by the GOP plan to eliminate the individual mandate, which would cause instability in the Obamacare exchanges. CAP is proposing that Democrats and Republicans can agree on these proposals — without the tax cuts for the rich and gutting of Medicaid also envisioned by McConnell’s team.

The third proposal in the CAP plan isn’t in the GOP plan. It involves giving tax incentives to insurance companies who agree to cover patients in parts of the country where there is only one insurer (or fewer). One idea is to encourage insurers by eliminating the health insurance tax for plans that enter these markets, though Spiro said he’s open to other suggestions and tweaks. The plan also says that CAP would support a public option to make sure that everyone is covered.

Should the left be only calling for a public option or single-payer solution instead?

It goes without saying that the biggest difference between the CAP plan and Senate Majority Leader Mitch McConnell’s is that CAP would not call for, well, the rest of BCRA. It scraps BCRA’s massive tax cuts for billionaires, the steep cuts to Medicaid, the deep wound to Obamacare’s subsidies, and essentially only uses the ideas for guaranteeing Obamacare’s Cost Sharing Reductions and the reinsurance fund.

But it’s also a marked break from what some on the progressive left want to see: unified Democratic calls for a public option, or Medicare-for-all single-payer bill. (CAP also supports a public option, and lists it as one possible way to bring down the number of uninsured Americans in the report.)

Earlier this week, the Progressive Change Campaign Committee released a statement preemptively attacking any move on the left to embrace a fix for Obamacare that didn’t include these much more far-reaching fixes to Obamacare.

“Any bipartisan health care solution must, at a minimum, include a robust public option for all or a Medicare buy in for all — and if it doesn’t, it is dead on arrival with the progressive base and most Americans,” PCCC’s Adam Green said.

There is robust support in the Democratic caucus for these ideas. More than half of House Democrats have agreed to cosign Rep. John Conyers’s (D-MI) single-payer proposal — the most support it’s gotten in the party’s history.

Spiro says he’s not bothered by concerns that the left should instead be focused on demanding a public option or Medicare-for-all. Like many in the Senate Democratic caucus, he said the priority has to be on improving Obamacare for patients in the short term — and, above all, stopping Republicans’ dangerous bill.

“You’ve talked to some of these patients: They feel they’re at risk right now and that their care may be impacted next year or the year after. Our immediate focus has to be on stabilizing the markets and removing this threat and this uncertainty,” Spiro told me. “My number one priority, above all else, is to help and protect those people.”