Tag: "ObamaCare"

Government-Health Complex Continues to Congeal

TevennerThe government-health insurance complex continues to congeal as AHIP, the health insurers’ main trade association, picked former Centers for Medicare & Medicaid Services (CMS) Administrator Marilyn Tavenner to lead it.

Although not confirmed as CMS Administrator until May 2013, she acted in that capacity since December 2011, after the administration fumbled the appointment of Dr. Donald Berwick to the position. In other words, she is the grande dame of Obamacare.

Physician Payments, Patient Out-of-Pocket Payments Up a Little in 2014

The Robert Wood Johnson Foundation and athenahealth (NASDAQ: ATHN) have released their analysis of physician payments in 2013 versus 2014. athenahealth is an extremely innovative provider of cloud-based electronic medical records (EMRs) to physicians, and has a very complete set of data on their clients payments from all payers.

The result? Not much change from 2013 to 2014, the first year of full-throttle Obamacare:

Primary payments—those made by insurance carriers—to office-based physicians rose moderately between 2013 and 2014. Payments declined for orthopedics and surgery while increasing for primary care and obstetrics-gynecology. Patients’ payment obligations rose for all specialties, and deductibles were the largest category of increased patient spending.

(K. Hempstead, et al., “Tracking Trends in Provider Reimbursements and Patient Obligations,” Health Affairs, vol. 3, no. 7, July 2015, pp. 1220-1224)

Unbelievable! Senator Hatch Cannot Find $30 Billion For Medical Device Excise Tax Repeal

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

Congress may be on the verge of repealing Obamacare’s medical device excise tax. I am all for repealing it, which will reduce funding for Obamacare by $24 billion over ten years. Of course, that means it will increase the deficit by $24 billion, which means Congress has to offset repeal by cutting spending by the same amount.

Can’t be done, says Senator Orrin Hatch, Chairman of the Senate Finance Committee: “It’s pretty hard to come up with a $30 billion offset,” (as reported by the Wall Street Journal’s Isaac Stanley-Becker). I am not sure how Senator Hatch rounded the figure up to $30 billion, but that does not really matter.

It should be as hard to find $24 billion or $30 billion of spending offsets as it is to find a cup of coffee at Starbucks. Here are some examples, plucked from the pages of President Obama’s budget proposals:

Zeke Emanuel Hammers Obamacare Again

Obamacare’s best frenemy, Dr. Ezekiel Emanuel, and his colleagues at the Center for American Progress, gave up on Obamacare last year. In yesterday’s Wall Street Journal, he and Topher Spiro emphasizes that Accountable Care Organizations, which Obamacare established to co-ordinate care and lower costs in Medicare, are failing to achieve either goal:

Obamacare is Reducing Competition

Novel concepts—whether practice-management companies, home health care or the first for-profit HMO—almost always have come from entrepreneurial firms, often backed by venture capital.

That venture capital has been drying up since ObamaCare was passed. Instead, the biggest wagers in health-care services are being placed by private equity, which is chasing opportunities to roll up parts of the existing infrastructure. For instance, there were 95 hospital mergers in 2014, 98 in 2013, and 95 in 2012. Compare that with 50 mergers in 2005, and 54 in 2006. Cheap debt and ObamaCare’s regulatory framework almost guarantee more consolidation. That will mean less choice for consumers.

(Scott Gottlieb, “How the Affordable Care Act Is Reducing Competition,” Wall Street Journal, July 5, 2015.)

What King v. Burwell Means for California’s Obamacare Exchange

(A version of this op-ed was published by the Orange County Register.)

It is usually not a good idea to take the risk of predicting what politicians and bureaucrats will do, but here’s a shot: California will decide to wind down the failing Covered California Obamacare exchange and transfer its operations to healthcare.gov, the federal exchange. That won’t solve any of the fundamental problems of Obamacare itself, but at least it will relieve the state of a problem child.

California established Covered California because the Affordable Care Act, passed in 2010, only allows tax credits to be paid to health insurers in exchanges established by states. These tax credits are the only way to make the expensive Obamacare plans affordable to beneficiaries. All but 16 states and D.C. rejected Obamacare and declined to establish exchanges. That did not stop the federal government, which set up healthcare.gov to funnel tax credits to health insurers in the majority of states without exchanges.

On June 25, the U.S. Supreme Court decided King v. Burwell, rewriting the law to allow the federal government to continue to pay tax credits through healthcare.gov. Although a disappointment for the rule of law, the decision gives California an off-ramp from the exchange business.

Obamacare 2016 Rate Hikes Still Double Digits

When the first wave of Obamacare’s 2016 double-digit rate hit, defenders insisted that these were outliers. Well, those rate hikes keep coming, especially from insurers with large market share:

Health insurance companies around the country are seeking rate increases of 20 percent to 40 percent or more, saying their new customers under the Affordable Care Act turned out to be sicker than expected. Federal officials say they are determined to see that the requests are scaled back.

Blue Cross and Blue Shield plans — market leaders in many states — are seeking rate increases that average 23 percent in Illinois, 25 percent in North Carolina, 31 percent in Oklahoma, 36 percent in Tennessee and 54 percent in Minnesota, according to documents posted online by the federal government and state insurance commissioners and interviews with insurance executives.

(Robert Pear, “Health Insurance Companies Seek Big Rate Increases for 2016,” New York Times, July 3, 2015)

Oregon Health Plans Ordered to Raise Rates!

All that complaining about double-digit Obamacare rate hikes for 2016? Well, at least one Insurance Commissioner thinks they’re not high enough. Plans in Oregon have lost so much money on Obamacare that the state’s Insurance Commissioner fears for their solvency unless they hike premiums more than they have asked for:

The Oregon Insurance Division says it is pushing health insurers to charge higher individual rates in 2016 because they are reporting huge underwriting losses for 2014.

The insurers collected just $703 million in premiums for 2014 and spent $830 million on 2014 claims, officials say.

(Alison Bell, “5 Oregon insurers under orders to raise their rates,” LifeHealthPro, June 19, 2015)

Strict Antitrust Review for Health Insurers, Hospitals

As Obamacare accelerates the transformation of the U.S. health sector into a complex of regulated utilities, providers are concentrating into oligopolies. The Wall Street Journal reports that the U.S. Department of Justice will use “strict review” when considering mergers of health insurers, while the Federal Trade Commission will also review hospital mergers closely:

The prospect of consolidation poses high stakes for the Obama administration, whose signature domestic policy legacy is the 2010 health-care law. Some aspects of the health law were designed to increase insurance-industry competition, including marketplaces for health coverage and the creation of new nonprofit cooperative health plans around the country.

But the law also includes provisions that may have helped inspire consolidation, at least indirectly.

(B. Kendall & A. Wilde Mathews, “DOJ Girds for Strict Review of Any Health-Insurers Mergers,” Wall Street Journal, June 28, 2015)

Obamacare and Employer-Based Benefits

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

Now that we have over one full year of ObamaCare under our belts, a mystery is unfolding: What is happening to employer-based benefits? Data from different sources convey widely different messages, but until we solve this mystery, it is difficult to predict the political future of President Obama’s troubled health reform law.

The puzzle is obscured by the media’s focus on topline figures, which indicate significant increases in the number of insured people, including millions added to Medicaid, the joint state-federal program for low-income households. In truth, it is inappropriate to categorize Medicaid dependents as “insured” — for the same reason it is inappropriate to consider jobless people who receive cash welfare benefits as “employed.” The fiscal difference between people who depend on government benefits and those who do not is one of kind, not of degree.

But how should we classify consumers covered through the ObamaCare exchanges? Are they government dependents or not? The issue is tricky.