Category: New Health Care Law

Obamacare and Employment (Again)

Vox’s Mattew Yglesias, an undaunted Obamacare supporter, has listed “7 charts that show what Obamacare critics are getting wrong”. The first is, you guessed it, that chart from the Gallup survey of health insurance that this blog has been analyzing and criticizing pretty relentlessly.

I’m not going to go through all seven, but focus on his claim that Obamacare is not causing part-time work at the expense of full-time work. Here it is:

Vox

Tax Day: Obamacare Comes Home To Roost

The National Taxpayers Union Foundation (NTUF) has released its latest analysis of  “tax complexity”:

This year’s new analysis of tax complexity from National Taxpayers Union Foundation (NTUF) found some startling lead figures: a $234 billion cost to the economy due to 6.1 billion lost hours of productivity and $32 billion spent out-of-pocket to comply with America’s insanely complicated tax system.

Looking deeper at NTUF’s research, there is one big reason to think this could be the beginning of a trend in the wrong direction: 3,322 pages of legal guidance for Obamacare (or the ACA) added to IRS.gov (1,077 pages of regulations, 1,377 pages of Treasury decisions, 669 notices, 100 revenue procedures, and 12 revenue rulings).

Essentially, Obamacare is coming home to roost.

NTUF

Why Are So Many Working-Age People On Medicare Since Obamacare Started?

Gallup has released the full results of its first quarter survey of health insurance. It concludes that the proportion of uninsured Americans has collapsed to the lowest level ever – 11.9 percent.

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The early release of the estimate had predicted 12.3 percent, and it got a little better as the dust has settled on the second open season.

More Than One in Five Obamacare Enrollees From 2014 Have Not Re-Enrolled

Avalere Health has released a new analysis of exchange enrollment, emphasizing that states with the federal Obamacare exchange (healthcare.gov) retained more 2014 Obamacare beneficiaries than states with their own exchanges:

Federally-facilitated exchange states reenrolled 78 percent of their 2014 enrollees in 2015, on average. In state-run exchange states , that percentage drops to 69 percent of 2014 enrollees. California, the state with the highest enrollment in 2014, only retained 65 percent of their 2014 enrollees.Avalere

Will Obamacare’s Tax Dodgers Take Advantage of Special Enrollment?

Those of us who take the time to understand the burdens that the federal government increasingly impose on us might be excused for envying the Obamacare tax dodgers, who got a special enrollment period to sign up for Obamacare if they let the February 15 deadline for enrollment whizz by.

From the Administration on February 20:

For those who were unaware or didn’t understand the implications of the fee for not enrolling in coverage, CMS will provide consumers with an opportunity to purchase health insurance coverage from March 15 to April 30. If consumers do not purchase coverage for 2015 during this special enrollment period, they may have to pay a fee when they file their 2015 income taxes.

These are the folks who, despite massive media coverage of Obamacare (which was signed in 2010) lived in blissful ignorance that the federal government now imposes a mandate on them to purchase a government-certified health plan. When they file their taxes, they will be shocked and appalled to learn that they owe a penalty.

For every other American, of course, ignorance of the law is no excuse. Obamacare is so unpopular, however, that the Administration knew it had to give relief to these folks.

Well, the early figures for the special enrollment are in, and they are pretty laughable: Only 36,000 of 4 million eligible enrollees signed up by March 29. Charles Gaba, an Obamacare advocate and leading expert on estimating Obamacare enrollees, thinks it’s too early to panic: Folks have another month to enroll.

I tend to agree: Someone who has still not figured out – after five years – that Obamacare imposes this mandate is unlikely to file his taxes early – or even on time.

Health Insurers Just Fine Under Obamacare

New research from the Commonwealth Fund, a pro-Obamacare think tank, shows that health insurers are doing just fine under Obamacare.

Well, the stock market has been telling us that for years. The report’s purpose is to cheer the rebates that insurers which made too much money paid to consumers. Obamacare regulates the Medical Loss Ratio (MLR). If an insurer does not spend enough premium on medical claims, it has to pay a rebate to its beneficiaries.

Rebates have collapsed from over $1 billion in 2011 to $325 million in 2013. The report concludes that Obamacare caused insurers to reduce their overhead expenses and profits. Actually, there is less to this story than meets the eye. Exhibit 5 shows that there has been very little change in insurers’ income statements over the three years.

T5

(Source: Michael J. McCue & Michael A. Hall, The Federal Medical Loss Ratio Rule: Implications for Consumers in Year 3, New York, NY: Commonwealth Fund, March 2015, page 6.)

Obamacare is Driving Up Medicare Premiums

Obamacare includes a “health insurance providers fee” that is significantly increasing premiums. The fee is a fixed-dollar amount that is divvied up among insurers according to the amount of premium they write.

People who are really getting hit by this fee include Medicare Advantage beneficiaries who are enrolled in through retiree benefits. Because their former employers pay a share of their premium, the insurance fee has a disproportionate impact.

One reader sent me correspondence from his former employer’s HR department explaining why premiums are going up. In 2011, he paid $32.81 per month for both himself and his wife. In 2012 and 2013, the premium was $42.93. In 2014, it jumped up to $121.03, and $138.93 this year.

According the HR department, $40 (per person) of the 2014 increase was due to the fee, and $8-$10 of the 2015 increase:

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Well, the total increase in premium for 2014 was $78.10. So, we can conclude that the increase was entirely accounted for by the fee. Indeed, their premium would have gone down a couple of bucks, if not for the fee. The same is true for the 2015 increase.

Premiums almost tripled, for the sole purpose of funding Obamacare. No wonder seniors want this repealed and replaced.

Obamacare Beneficiaries 2.5 Times More Likely to Have HIV/AIDS Than Commercially Insured

One of our themes is that Obamacare causes health plans to attract the healthy and shun the sick. However, they do not succeed, according to a report by Prime Therapeutics, a pharmacy-benefit manager:

During tVariety of Medicine in Pill Bottleshe first year public health exchanges existed, Prime Therapeutics’ (Prime) members who enrolled in plans on these exchanges filled an average of 11.7 prescriptions, exceeding fills by commercial members by 13.6 percent. Public exchange members were also 2.5 times more likely to have hepatitis C or HIV, driving an almost 200 percent higher spend on related medicines.

More specifically, nearly $1 out of every $5 spent on drugs for public exchange members was spent to treat                                               hepatitis C or HIV.

The report also states that exchange beneficiaries are significantly older than commercially insured persons: 42.6 years versus 34.7 years old, on average. 28 percent of Obamacare beneficiaries were between 55 and 64 years old, versus only 16 percent of commercially insured persons.

Why does this matter? While Obamacare beneficiaries are older and sicker than people with employer-based benefits, they have less access to health services. Obamacare is not the right way to take care of these peoples’ needs.

Government and the Private Sector: The Case of eHealth, Inc.

Businessman Sitting at His DeskFor years now, Wall Street has cheered as Obamacare fuelled the stock prices of corporations in the healthcare industry. One of them was eHealth, Inc., a private health-insurance exchange that was founded in 1997.

Obamacare – in case you need reminding – mandates the purchase of private health insurance for working-age Americans above a low income. Last April, The Motley Fool’s Keith Speights speculated that eHealth might have been “Obamacare’s biggest winner”.

Well, that’s not how things turned out.

eHealth, has announced that it will lay off 15 percent of its workforce and take a restructuring charge of up to $4.7 million. This announcement followed horrific fourth quarter earnings.

Obamacare is Expensive and Difficult or Impossible to Afford

Obamacare is crushing agents and brokers, according to industry sources:

Amid the national debate over raising the federal minimum wage to $10 per hour, Scott Leavitt of Boise says he and his fellow advisors have been enrolling clients in their state’s health insurance exchange for an hourly wage that works out to about $4.50 – and sometimes even less. (Susan Rupe, InsuranceNewsNet)

And that is just the advisors. The same article also reports results from neutral or pro-Obamacare organizations like HealthPocket, Kaiser Family Foundation, and the Commonwealth Fund to show how much pain Obamacare is causing patients: Deductibles too high, premiums too expensive, and he whole shebang unaffordable.