Category: New Health Care Law

Senate Better Care Act: A Big Bunch of Sausage Meat Loaf

Backroom policy deals have been described as akin to making sausage. You don’t really want to see it done or you’d lose your appetite. The new senate health bill is more like meat loaf than sausage, however. By that I mean a recipe composed of delicious ingredients mushed together with really distasteful ones in an unappetizing blob that could have been a great burger but wasn’t. Remember that 1977 song “Two Out of Three Ain’t Bad” by the band Meat Loaf? That pretty much sums up the senate health reform bill.

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Better Care Reconciliation Act of 2017

Capture88(aka Senate version of American Health Care Act)

The Senate health bill has some good things and some not-so-good things. It largely keeps too much of Obamacare, except the individual and employer mandates, and repeals most of Obamacare taxes but allow almost no additional health plan flexibility. Oh, it’s pretty good on Medicaid.

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Why Do Late Middle-Aged Women Allow Obamacare To Gouge Them?

Women joggingIn February, Professor Mark Pauly of the Wharton Business School wrote a short article proposing reforms to individual health insurance, in which he reminded us the biggest premium hike in the market for individual insurance consequent to Obamacare was among women in their 60s. The actual research was published in 2014, but I have wondered about it ever since.

Obamacare prevents insurers from charging premiums for 64-year olds that are more than three times those charged to 18-year olds. (A multiple of about five would be fairer, according to actuaries’ consensus.) Intuition tells us that should reduce premiums for older people. That intuition is wrong. Nevertheless, if politicians can convince people it is true, it makes political sense to impose the rule, because older people are much more likely to vote than younger people.

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Obamacare’s Individual Mandate: J.R. Graham Testifies on Capitol Hill

On January 24, Senior Fellow John R. Graham testified in the effect of Obamacare’s individual mandate before the U.S. House of Representatives’ Ways & Means Committee Oversight Subcommittee. A three-minute highlight reel is posted below:

You can read his written testimony at this link and watch the entire testimony at this link.

 

Trump Disembowels Obamacare… Slowly and Painfully

InsFormSmallOn the day of his inauguration, President Trump took time out to issue an executive order directing his administration to drag its feet enforcing provisions of the Patient Protection and Affordable Care Act (ACA). Regulators were instructed to “waive, defer, grant exemptions from, or delay…” whenever possible to the “maximum extent of the law.” Many believe this move was intended to destabilize the ACA and hasten its demise without Republicans getting blamed.

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Council of Economic Advisers’ Bad Obamacare Economics

CEAPresident Obama’s Council of Economic Advisers (CEA) has issued its valedictory report on the state of Obamacare. The gist of the argument is that Obamacare is doing fine, on the verge of overcoming its growing pains since 2014.

The CEA claims critics who suspect the 25 percent increase in premiums for 2017 are a problem are off-base. In a normal insurance market, this would indicate a “death spiral”: The sick enroll and the healthy stay away, causing next year’s premiums to increase. The cycle repeats itself until only the sickest enroll. The CEA asserts this cannot be occurring because 11.3 million people enrolled in Obamacare last December, which was 300,000 more than in December 2015. Further, insurers underpriced their policies in 2014 because the market was new. However, they have learned since then and are pricing policies more realistically.

While it is true enrollment in Obamacare’s market is a little higher than last year, it is still well below the Congressional Budget Office’s estimate of 21 million enrollees in 2016, which it made as recently as March 2015. Even in January 2016, it estimated 13 million would enroll last year, which was almost one fifth too high.

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The Price is Right! Trump’s Choice Indicates Push to Repeal and Replace Obamacare

220px-Tom_PriceDonald Trump’s choice of Dr. Tom Price as his nominee for U.S. Secretary of Health & Human Services indicates the Trump Administration will make a serious effort to repeal and replace Obamacare with patient-centered health reform.

After some initial signs of hesitation at actually trying to achieve this six-year old campaign promise, Obamacare’s opponents can now be confident that skilled leadership will wage a sophisticated and likely successful effort to restart health reform. Here are four reasons why:

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Obamacare Coverage 10 Percent Less Expensive Than Job-Based Benefits

nnScholars at the Urban Institute, staunch defenders of Obamacare, have previously struggled to find ways to report Obamacare’s good news by pointing out “there is no meaningful national average” of premium hikes. More recently, they have concluded that Obamacare coverage is 10 percent less expensive than employer-based coverage.

Comparing average employer-based premiums to the second-lowest cost Silver benchmark Obamacare plans, the Urban Institute scholars found lower Obamacare premiums in 38 states plus Washington, DC. These are the unsubsidized Obamacare premiums, adjusted for age, actuarial value, and utilization associated with actuarial value.

What to make of this finding?

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Obamacare 2017 Premium Hikes 25 Percent. What Next?

p_kleyman_medicut_500x279The Administration has confessed the average 2017 Obamacare premium hike for the benchmark (second-lowest cost) Silver plan will be 25 percent. (Back in June, it looked like the hike would be 16 percent.)

Don’t worry, says the Administration, tax credits will ensure beneficiaries only pay a fraction of their premiums. It is true, very few people would buy Obamacare plans without the tax credits the Administration cheers. However, that is not a sign the plans are “affordable,” but only that taxpayers are bearing more of the burden.

Nor do the tax credits actually prevent people from sticker shock. In fact, the design of the tax credits usually makes the net premium hike higher than the gross premium hike. For example, the average premium hike next year in California will be 13.2 percent, but a 56-year old woman in Los Angeles just learned her premium will jump 57 percent next year.

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A Dull EDGE: The Administration Believes Obamacare’s Costs Went Down!

HealthcaredotgovThe Centers for Medicare & Medicaid Services (CMS) has just made the remarkable claim that medical costs paid by health insurers operating in Obamacare’s exchanges declined in 2015 from 2014:

Per-enrollee costs in the ACA individual market were essentially unchanged between 2014 and 2015. Specifically, after making comparability adjustments described below, per-member-per month (PMPM) paid claims in the ACA individual market fell by 0.1 percent from 2014 to 2015. For comparison, per-enrollee costs in the broader health insurance market grew by at least 3 percent.

The report compares apples to oranges. When discussing the change in costs in the exchange, it estimates medical claims. When discussing changes in employer-sponsored health insurance, it estimates premiums (which increased 3 percent). The average Obamacare premium increased 5.2 percent in 2015, more than employer-sponsored coverage. (See note below.)

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