Tag: "ObamaCare"

Obamacare’s Shrinking Costs Should Bring Tax Cuts

debtThe Congressional Budget Office’s March budget baseline updates its estimates of costs and insurance coverage due to Obamacare. The March baseline estimates that the gross cost of Obamacare’s subsidies and Medicaid spending for the years 2016 through 2025 will be $1.7 trillion, $286 billion less than it had estimated in the January baseline.

The CBO calculates a so-called “net cost” by subtracting revenues from businesses and individuals paying the mandate/fine/penalty/tax for not buying Obamacare, the “Cadillac tax” on high-cost health cost insurance, and the effect of changes in taxable compensation. This net cost has shrunk by $142 billion to $1,207 billion.

Even more impressive are the reductions in the cost of Obamacare from the CBO’s original March 2010 score of Obamacare. The two estimates overlap for the seven years, 2015 through 2021. The original estimate was that Obamacare’s gross cost would be $1.4 trillion over the period, and the net cost $1 trillion. These have shrunk to $992 billion and $751 billion, reductions of 28 percent and 29 percent.

When the CBO issues a new baseline, it updates its estimate of Obamacare’s insurance provisions. What it does not do is update its estimate of revenues from the host of other taxes in the Affordable Care Act, such as the medical-device excise tax.

So, it is not immediately obvious that Obamacare’s shrinking cost estimates should open the door to cutting some of those harmful taxes – which they should.

Galluping Away with the Uninsured

GallupGallup has released a teaser for its quarterly update of health-insurance coverage. Although the polling firm released only one datum (that the rate of uninsured fell to 12.3 percent in the first quarter from 12.9 percent in the fourth quarter of 2014) this was enough for President Obama to send forth a victory tweet.

Not so fast: As the press release itself notes, a large proportion of the newly “insured” are not actually insured, but on Medicaid. Medicaid is a welfare program. Consider the question: “Do you have health insurance coverage?” It is as if people receiving cash welfare payments answered the question, “Do you have a job?” in the affirmative.

Safety-Net Hospitals Profit Under Obamacare

Guess what? Those safety-net hospitals in states that did not expand Medicaid, which were pleading that they would go bust unless that welfare program grew, are doing just fine:

Hospitals that treat many poor and uninsured patients were expected to face tough financial times in states that did not expand Medicaid under the federal law known as Obamacare.

That’s because they would get less Medicare and Medicaid funding under the Affordable Care Act, while still having to provide high levels of charity care.

But in some of the largest states that did not expand Medicaid, many safety-net hospitals fared pretty well last year — even better than in 2013 in many cases, according to their financial documents. KHN looked at the performance of about a dozen such hospitals in Florida, Texas, Georgia, Tennessee, South Carolina, Virginia and Kansas, which released their 2014 financial results. (Phil Galewitz, MedCityNews)

Senate Dems: Get Pregnant, Then Get Health Insurance

Women joggingWhile everyone else is wondering whether the Supreme Court will replace Obamacare in 37 states with the actual Affordable Care Act as written, some Democratic U.S. Senators are urging women to dive deeper into Obamacare’s perverse incentives by encouraging them to delay getting health insurance until after they become pregnant.

As reported by Lydia Wheeler in The Hill, Senator Patty Murray has round up 36 signatures on a letter addressed to U.S. Health & Human Services Secretary Sylvia Burwell urging her to pull yet another “special enrollment period” out of her bag of tricks.

In a statement, Christina Postolowski, health policy manager of Young Invincibles, said she’s thrilled to see a growing chorus of leaders calling on the administration to create a special open enrollment period to make maternity coverage available to pregnant women year-round.

According to Postolowski’s December 2014 report “Without Maternity Coverage” maternity care and delivery ranges from $10,000 to $20,000 without complications.

The Kline-Ryan-Upton Republican Off-Ramp from Obamacare

Tomorrow is the day the Supreme Court hears oral arguments in King vs. Burwell, and all the talk is about what Congress will do if the Supreme Court directs the Administration to obey the law by not paying subsidies in the majority of states, which have declined to establish their own Obamacare exchanges and defaulted to the federal one.

The Wall Street Journal ran an op-ed (available by subscription) by John Kline, Paul Ryan, and Fred Upton, who chair committees of jurisdiction in the House of Representatives that will be tasked with proposing a Congressional response to this decision. Here’s what they write:

Let people buy insurance across state lines. Stop frivolous lawsuits by enacting medical-liability reform. Let small businesses band together so they get a fair deal from insurance companies.

Crowd-out Effect of CHIP Expansion 44 to 70 Percent

In 2009, Congress reauthorized the Children’s Health Insurance Program (CHIP), providing states added resources and options to insure children. About 15 states expanded CHIP eligibility to families with incomes up to 400 percent of the federal poverty level (an income of $94,000 for a family of four) with a median upper limit for coverage at 250 percent of poverty, the highest since CHIP’s inception in 1997. Federal CHIP funding is up for reauthorization in 2015 and some argue that CHIP is unnecessary because of Obamacare’s subsidies, which kicked in this year.

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Source: “The Impact of Recent CHIP Eligibility Expansions on Children’s Insurance Coverage” from Health Affairs.

Half of Doctors Give Obamacare D or F

Confident DoctorsThe Physicians Foundation and Merritt Hawkins (a physician recruiting firm) have just published their biennial physicians’ survey. The survey interviews over twenty thousand physicians in all fifty states and multiple specialties:

  • Only 19 percent say they have time to see more patients.
  • 44 percent plan to take steps to reduce services or find non-clinical employment.
  • Only 35 percent describe themselves as “independent practice owners,” down from 62 percent in 2008.
  • 53 percent describe themselves as hospital or medical-group employees, up from 38 percent in 2008.

Price Transparency: Even Hospitals are Starting to Figure It Out!

credit-card-2Like many, we’ve been frustrated at the lack of price transparency in U.S. health care, especially form hospitals. Good news: They are coming around!

The American Hospital Association (AHA) has published an informative white paper, clearly explaining the state of price transparency for both hospitals and health plans. It surveys what hospitals are doing to ensure patients better understand their expected out-of-pocket costs, what tools health plans are offering beneficiaries to estimate costs, and the legal and regulatory environment. The language used in the white paper is strikingly different from that which we are used to seeing from hospitals:

Price transparency also can lead to improved quality and efficiency as providers benchmark and improve their performance against peers and national averages. To realize these potential benefits, policymakers and the public increasingly are calling for greater access to information.

Federal Courts Zig and Zag on Obamacare Tax Credits

index1Obamacare opponents’ hearts rose this morning, as a three-judge panel of the DC Circuit Court of Appeals struck down the power of federal Obamacare exchanges to pay out tax credits to health insurers who sign up beneficiaries for subsidized Obamacare coverage. Because most states declined to set up their own Obamacare health insurance exchanges, subsidies to insurers would have come to a screaming halt in most of the country. Opponents have long hoped that such a decision would force the Administration back to the negotiating table with Congress.

However, merely a couple of hours later, the 4th Circuit Court of Appeals in Richmond, VA upheld the Administration’s position: That federal exchanges have the same powers as state exchanges to pay out subsidies to health insurers. The Administration plans to appeal the DC panel’s decision to the entire DC Circuit, en banc (i.e. all eleven judges).

Yippee! Medicare Won’t Go Bust Until 2030!

The latest Congressional Budget Office’s latest Long-Term Budget Outlook now asserts that Medicare’s so-called “Trust fund”. Talk about kicking the can down the road!

As the chart below shows, the problem is not that the “trust fund” will go bust in any given year, but that the federal government is borrowing money to finance consumption. “Other non-interest spending” includes major infrastructure and defense, tasks which constitutionally and under a proper economic understanding fall to the federal government. These were the purposes for which the Founders gave Congress the power to borrow money in the people’s name. Borrowing to finance seniors’ healthcare consumption does nothing for future generations’ prosperity.

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