Tag: "ObamaCare"

Jeb Bush Health Reform: Innovation and Patient-Centered Care

Bush2(A version of this Health Alert was published by The Hill.)

By avoiding sound bites and respecting voters’ ability to understand issues, Governor Jeb Bush’s health-reform proposal demonstrates strong leadership. Repeal and replace Obamacare? Sure, Bush is for that, but no Republican politician should win points simply by regurgitating what many citizens fear has become little more than a slogan.

Peak Obamacare? We’re Almost There

money-burdenThe administration has released a report estimating that enrolment in Obamacare will reach only 9.4 million to 11.4 million at the end of 2016. Back in 2010, when the law was passed, the Congressional Budget Office estimated exchange coverage would be 21 million next year (Table 4).

Why the come down? Obamacare has a miserable take-up rate: Few who do not get significant subsidies sign up. Even worse, many of those who sign up at open enrolment cannot afford the premiums and drop out. Indeed, 15 percent of Obamacare beneficiaries who signed in 2015’s open season (which ended in February) were gone by the end of June. (The New York Times has just published interviews with some struggling to pay their premiums and maintain coverage.)

One year ago, I coined the term “Peak Obamacare” to describe this phenomenon. Although the administration’s cheerleaders have twice celebrated very high Obamacare enrolment during open season, the administration has finally decided to accept reality: We are on the verge of Peak Obamacare.

Jeb Bush’s Health Plan

BushJeb Bush’s health plan is out – and it is very good. Bush leads with fundamental reform of the Food and Drug Administration. “It should not cost $1.2 billion to $2.6 billion nor take 12 to 15 years to advance a medicine from discovery to patients, but that is the case under the Food and Drug Administration’s current regulatory mess.”

In recent weeks, we’ve read stories about drugs that have been around for decades, for which prices have been hiked sky-high. These price hikes are carried out by executives taking advantage of obscure FDA rules that impede competition.

Congress Uses “Reconciliation” to Push Deficit-Funded Obamacare

Congressional Republicans are using a procedural tool called “reconciliation” to repeal a miniscule number of Obamacare provisions, according to Chris Jacobs of the Conservative Review:

Lost in the noise amidst Speaker Boehner’s resignation last week was the House of Representatives’ decision to begin moving its budget reconciliation bill. Earlier this spring, conservatives voted for the budget blueprint in both the hope and expectation that the reconciliation bill coming from that budget would be used to put full repeal of Obamacare on President Obama’s desk. But based on the newly released legislative proposals, those expectations have been disappointed.

Just as important, however, the Obamacare legislative proposals are limited to the following provisions:

  1. Repeal of the law’s auto-enrollment mandate for employers;
  2. Repeal of the Prevention and Public Health “slush fund;”
  3. Repeal of the individual mandate;
  4. Repeal of the employer mandate;
  5. Repeal of the tax on medical devices;
  6. Repeal of the “Cadillac tax” on high-cost employer health plans; and
  7. Repeal of the Independent Payment Advisory Board (IPAB).

That’s it. Under the proposed reconciliation instructions, a grand total of seven out of Obamacare’s 419 legislative sections—just over one percent of the law—would actually be repealed.

Oscar and The Changing Health Insurance Landscape

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

Yesterday, the Senate Judiciary Committee’s Subcommittee on Antitrust, Competition Policy and Consumer Rights held a hearing on “Examining Consolidation in the Health Insurance Industry and Its Impact on Consumers,” at which the CEOs of Anthem and Aetna testified.  Both of these health insurers have announced friendly take-overs of two other insurers, Cigna and Humana.

One indicator regulators use to determine whether a business combination will reduce competition is whether there are significant barriers to entry in the industry. If there are, new competitors will not exploit openings created by incumbents’ consolidation. During the hearing, the CEOs of Anthem and Aetna each (independently) pointed to Oscar, a new health insurer with highly pedigreed investors, as evidence that health insurance is an easy business to enter.

Oscar is indeed an interesting enterprise, which has attracted fawning coverage in the business press both for its innovation and the quality of its investors. Nevertheless, Oscar is a curious start up, because it focuses exclusively on a market – Obamacare exchanges – in which insurers are taking on a lot of pain.

15 Percent of Obamacare’s Second Season Enrollees Were Gone by June 30

Obamacare’s second enrollment season closed around the end of February, with 11.7 million signed up. By March 31, that had dropped to 10.2 million who actually paid their first month’s premium. New data from the administration report that number dropped further to 9.9 million by June 30.

What is also notable is that the entire drop of paid enrollees occurred in states using the federal exchange, not state-based exchanges (for which enrolment stayed at 2.7 million). There is no word on whether the drop-outs got employer-based coverage, descended into Medicaid, or stayed uninsured. 423,000 were dropped by the administration because of lack of documentation of citizenship or immigration status.

A stable market? Not quite, I guess.

Why Is There No Car Care Crisis?

employer coverage 300(A version of this Health Alert was published by RealClearPolicy.)

Our health care is in “crisis.” We seem to have achieved the remarkable result of spending too much money while not ensuring access for enough people. Every politician says so, and most citizens agree. Indeed, no presidential candidate can be viewed as credible without proposing a health reform “plan.”

Hillary Clinton has sworn to protect and uphold the Affordable Care Act against all right-wing conspirators; Bernie Sanders has long advocated a government-monopoly, single-payer system; and Republican contenders will continue to roll out plans to “repeal and replace Obamacare” that will immediately come under attack by conservatives and libertarians as “Obamacare-lite.”

Let’s put the crisis in perspective. According to actuaries at the federal government, spending on health care per person in 2014 was $9,176. Yet according to the American Automobile Association (AAA), the average cost of operating and maintaining an average sedan in 2014 was $8,876 — almost exactly the same as health spending. Of course, not everyone owns a car, but most of us do. According to IHS Automotive, an industry research firm, 253 million cars traveled America’s roads last year. According to the Census Bureau, there were 239 million of us aged 18 through 84; that’s slightly more than one car per person in prime driving years.

Commonwealth Fund’s Red Herring on Obamacare Risk Selection

One of this blog’s consistent themes is that Obamacare encourages insurers to seek to enroll health people in exchanges, and shun sick people. A new study from the Commonwealth Fund insists that is not the case, concluding that “insurers aren’t seeking lower-risk customers outside the ACA exchanges as some feared,” and “the ACA’s insurance reforms are working in the individual market.”

I will share the study’s conclusion, then explain the red-herring hypothesis it is meant to test:

Gallup Confirms Obamacare Increased Welfare Dependency

I did not bother to discuss Gallup’s July update on the drop in uninsured Americans, because it was substantively the same as the teaser released in March, which showed most of the increase in health insurance was actually Medicaid, which is welfare dependency.

Gallup has just released a state-by-state report, concluding Medicaid expansion and establishing a state exchange almost doubled the reduction in uninsured. Of the two, I cannot imagine setting up a state exchange is a big factor, because beneficiaries get the same tax credits in state or federal Obamacare exchanges. Obamacare mostly increased Medicaid dependency.

Obamacare Now Hurts Republican Politicians More than Obama

index1(A version of this Health Alert was published in the San Francisco Chronicle on August 10, 2015.)

Polls consistently show that Obamacare is unpopular. Back in April 2010, the month before the law was signed, 46 percent of all adults surveyed had a favorable view of the Affordable Care Act, while just 40 percent had an unfavorable view, according to the Kaiser Family Foundations’ regular tracking poll. Things have not changed much since then.

Yet, the law now appears to be hurting Republicans politicians more than Democrats. It looks like Congressional Republicans, who have controlled both chambers of Congress since January, are running out of excuses for failing to advance a comprehensive proposal to repeal and replace Obamacare.