Tag: "ObamaCare"

Obamacare Premiums Explode

The Wall Street Journal has reviewed health plans’ rate filings for 2016 in Obamacare exchanges:

In New Mexico, market leader Health Care Service Corp. is asking for an average jump of 51.6% in premiums for 2016. The biggest insurer in Tennessee, BlueCross BlueShield of Tennessee, has requested an average 36.3% increase. In Maryland, market leader CareFirst BlueCross BlueShield wants to raise rates 30.4% across its products. Moda Health, the largest insurer on the Oregon health exchange, seeks an average boost of around 25%.

All of them cite high medical costs incurred by people newly enrolled under the Affordable Care Act. (Louise Radnofsky, “Health Insurers Seek Healthy Rate Boosts,” May 21, 2015)

Senator Cassidy Introduces King v. Burwell Alternative

Cassidy Official Headshot

(A version of this Health Alert was published by Forbes.)

Senator Bill Cassidy (R-LA) has introduced the Patient Freedom Act, in anticipation of the Supreme Court deciding for the plaintiffs in King v. Burwell, the lawsuit that seeks to force the administration to obey the law by not paying tax credits to health plans operating in states using a federal health insurance exchange (i.e. healthcare.gov).

Victory for the plaintiffs this summer would cause significant disruption in health insurance in the 34 to 37 states without their own exchanges because premiums for up to nine million people would increase significantly. Many would choose to drop coverage if and when they have to face paying full premium for their policies.

Congress must have an alternative to Obamacare ready because President Obama will immediately propose an amendment to change the law to accord with how he is executing it. That is: Let tax credits continue to flow through healthcare.gov and just forget the money paid since January 2014 was illegal. It would be a very simple amendment – just a few sentences. The risk of Congress panicking and simply voting for that amendment, and finally surrendering to Obamacare, is unacceptable.

Americans have had their health coverage upended not only by the Affordable Care Act, but also by the allegedly illegal execution of the law by the administration. Congress has a duty to respond to a court victory with a new law. However, it has to be one that the president will sign, but will not leave the Republican-majority Congress’ fingerprints on Obamacare. This is a tricky needle to thread.

Dr. Cassidy believes he can achieve this by restoring federal funding to states that will lose tax credits, but freeing them from Obamacare. To be clear: If a state wants to restore the Obamacare tax credits, it would be free to do so by establishing a state-based exchange. However, state-based exchanges are a proven failure, which no responsible governor should institute in 2015. It would be an obvious choice to take Dr. Cassidy’s other option: Receive the federal dollars and use them in a way that empowers patients, rather than the federal government.

Draining More Brains: Where Medicine is Heading

Watching the Affordable Care Act roll-out and reading about its gestation in Steven Brill’s book, America’s Poison Pill, makes one very aware that there is a serious brain drain under way in medicine.  Here’s what anyone can see:

Numbers of applicants to medical school, which once was 10 for every place, is now less than 1.  Physicians are telling their children not to go into medicine. There is now more than a 7 foot stack of regulations for the Affordable Care Act. As we all know, the slogan for this whole program has been “the healthcare system is broken.”  (If that is so true, why force feed new people into it?)

Some manifestations:  the adoption of the ICD-10 coding system, which defines conditions needing care in such detail that there is an unacknowledged administrative cost for compliance and a substantial legal and financial risk if there is mis-coding. Another is the forced adoption of Electronic Medical Records, with rules for “Meaningful Use.” This will produce electronic oversight of all medical care, in the guise of supporting “quality of care” and facilitating “Value-based Payments.”  Ultimately, the government regulators expect to have real time access to any person’s care and any physician’s performance.

Families USA: One Third of Low-Income Obamacare Beneficiaries Cannot Afford Care

One of Obamacare’s biggest cheerleaders, Families USA, has published new research showing that one third of low-income Obamacare beneficiaries have not obtained medical care due to cost in 2014:

Lower- to middle-income adults who were insured for the full year were significantly more likely than those with higher incomes to forgo needed care because they could not afford it: Nearly one-third (32.3 percent) of lower- to middle-income adults didn’t get needed medical care (excluding dental care) because they could not afford it. (p. 14)

But don’t you worry, Families USA has not thrown in the towel on Obamacare yet:

Since its passage in 2010, the Affordable Care Act (ACA) has made tremendous progress in improving access to health insurance and health care for millions of Americans. Approximately 14.1 million previously uninsured Americans gained health insurance between the beginning of open enrollment in October 2013 and March 4, 2015.

Well, not actually: Most of the Obamacare “insured” have actually fallen into welfare dependency (Medicaid), and the increase in privately insured is questionable.

Families USA recommends that even more taxpayer-funded healthcare dollars be channeled through health insurers. Investors in health insurers must love these policy prescriptions from progressive advocacy groups.

Successful Health IT Deals Are Obamacare Agnostic

(A version of this Health Alert was published by Forbes.)

Obamacare has definitely benefitted the health sector. My Forbes colleague Zina Moukheiber makes the case the Affordable Care Act (Obamacare) and the HITECH Act of 2009 (which channeled 30 billion taxpayer dollars into Electronic Health Records) deserve the credit (or blame) for the explosion of health information technology investments. That is undoubtedly true for traditional Electronic Health Record (EHR) providers like Cerner or Epic, which were boosted by the HITECH Act. In addition, the recently signed Medicare “doc fix” will likely ensure they continue raking in money for a while, because the law increases the EHR burden on physicians.

However, other successful new health IT ventures have prospects quite independent of Obamacare’s risky future. Rather, they appear robust in the face of a wide range of possible futures for U.S. health reform. Because health care is so dependent on government, it is not surprising that adoption of effective IT in health care has lagged behind other sectors, where suppliers have to rely on customers — not government — for revenue. Nevertheless, even a sector so politically protected from disruption as U.S. health care must eventually give way to change. Three examples show this change can come from different directions, despite Obamacare’s straightjacket.

Hawaii’s Obamacare Exchange Closing After Spending $205 Million

If a tax credit falls from Washington, and no Obamacare exchange receives it, what subsidy does it make?

Despite over $205 million in federal taxpayer funding, Hawaii’s Obamacare exchange website will soon shut down.  Since its implementation, the exchange has somehow failed to become financially viable because of lower than expected Obamacare enrollment figures. With the state legislature rejecting a $28 million bailout, the website will now be unable to operate past this year. (Alexander Hendrie, Americans for Tax Reform)

This is kind of perfect storm: State-based exchanges have or will shut down, both because most of them rival the DMV for customer service and because there is no more federal money to pay for them.

On the other hand, the Supreme Court will soon issue its decision in King v. Burwell, which might terminate Obamacare tax credits in the federal Obamacare exchange, healthcare.gov.

By the end of the year, Obamacare tax credits might have nowhere to go, effectively bringing Obamacare to a halt. It will give Congress a great opportunity to re-open the health reform debate.

Have Employer-Based Health Benefits Dropped?

Just the other day, my analysis of the RAND Corporation’s survey of health insurance from September 2013 through February 2015 led me to conclude that “economic growth improved coverage more than Obamacare did.”

However, there are other sources that contradict the RAND survey’s conclusions about employer-based benefits. My Forbes colleague Scott Gottlieb, MD, reviews a new report from Goldman Sachs that estimates small employers dropped 2.2 million beneficiaries from coverage, a reduction of 13 percent from 2013.

Last year, Ed Haislmaier and Drew Gonshorowski of the Heritage Foundation concluded that nearly 3.8 million people lost employer-based coverage through June 2014.

Both the Goldman Sachs and Heritage Foundation analysts relied on data from insurers rather than beneficiaries. Nevertheless, I am at a loss to understand how people who lost employer-based benefits would not say so in a phone survey.

At the Health Affairs blog, Marc Berk issues a caution about the “quick turnaround” surveys that are exciting the Obamacare debate, noting that the government itself is relying especially on the Gallup-Healthways survey instead of sober estimates produced by its own Census Bureau and Centers for Disease Control and Prevention.

The surveys agree that more people are dependent on Medicaid and Obamacare exchanges have enrolled a few million. The great divergence is with respect to employer-based health benefits.

75 Percent of Emergency Docs Seeing More Patients Since Obamacare

Three quarters of specialists in Emergency Departments are seeing more patients since January 1, 2014, according to a survey released by the American College of Emergency Physicians:

ACEP

 

Obamacare’s Risk Corridors Are Back, And Bigger And Badder Than Ever!

Last December, I discussed with some relief that Congress had stopped the unlimited taxpayer liability of Obamacare’s risk corridors, which protect profits for health insurers by transferring money from insurers with extra profits to those whose profits from Obamacare are less than expected.

The CROmnibus, which funded the government for 2015, put a guardrail around the risk corridors by legislating that any payments beyond budget neutrality would have to be appropriated. (That is, if extra profitable insurers earned $100 “too much” and losing insurers lost $200 “too much”, the winners could pay the losers $100, but the U.S. Treasury could not just make up the balance without Congress appropriating the funds.)

Well, Standard & Poor’s has just concluded that payments from extra profitable insurers will only fund 10 percent of risk corridor payments:

State Health Insurance Exchanges Going Bust

From the Washington Post:

Nearly half of the 17 insurance marketplaces set up by the states and the District under President Obama’s health law are struggling financially, presenting state officials with an unexpected and serious challenge five years after the passage of the landmark Affordable Care Act.

Many of the online exchanges are wrestling with surging costs, especially for balky technology and expensive customer call centers — and tepid enrollment numbers. To ease the fiscal distress, officials are considering raising fees on insurers, sharing costs with other states and pressing state lawmakers for cash infusions. Some are weighing turning over part or all of their troubled marketplaces to the federal exchange, HealthCare.gov, which now works smoothly.

Well, whether the federal exchange “works smoothly” or not is a discussion for another day. Although, I would beg to differ with the WaPo. A more appropriate description of healthcare.gov might be that it works illegally, because it pays tax credits to insurers without any legal basis for doing so.

That is the question in the Supreme Court case King v. Burwell. If the Supreme Court decides for the plaintiff, healthcare.gov will effectively wind down (because it won’t have any more access to taxpayers’ money). With state-based exchanges failing, the future of Obamacare is in great doubt.