Tag Archive: Medicaid

Majority Republicans lack votes, time to reform ACA, Medicaid via reconciliation bill

The dispute within the Republican Party over health care widened further Friday as President Trump joined with two conservative senators in calling for an outright repeal of the Affordable Care Act if the party fails to agree on an alternative plan by the end of the July Fourth recess. The reemergence of what has for much of the year been a fringe idea within the GOP revealed not only the party’s philosophical divide over how to revise Obamacare, but also senators’ growing anxiety that they are headed home to see their constituents with little to show them.

Source: Republicans grow increasingly anxious about heading home without a health plan – The Washington Post

The Republicans are back to square one of their years long challenge of repealing the Patient Protection and Affordable Care Act without any Democratic votes. It’s an exercise in the Einsteinian definition of insanity as doing the same thing over and over and expecting a different result. For example, see this article Republicans Divided on Replacement Legislation for Health Reform Law  — from May 1, 2012.

Majority Republicans must understand the limits of their policymaking power. Repeal or a rewrite of the enormous 10 title Affordable Care Act will require bipartisan cooperation and far more time than the remaining three months of the current fiscal year via a budget reconciliation measure that constrains major policy changes under the Byrd Rule. They also are facing strong blowback from constituents worried that attempting rapid and far reaching reform using the budget reconciliation process — including overhauling the five-decade-old Medicaid program — will disrupt their access to medical care.

 


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email fpilot@pilothealthstrategies.com or call 530-295-1473. 

Medicaid politics imperil Senate Better Care Reconciliation Act

Senate Republicans’ Obamacare repeal effort is on track to blow up before it even gets started.The GOP is well short of the votes needed to bring its bill to the floor, and party leaders and President Donald Trump are kicking into overdrive to save their imperiled health care overhaul.At least four Republican senators, Susan Collins of Maine, Rand Paul of Kentucky, Dean Heller of Nevada and Ron Johnson of Wisconsin, have signaled they could oppose a key procedural vote that will occur either Tuesday afternoon or Wednesday. A number of other senators, like Shelley Moore Capito of West Virginia and Marco Rubio of Florida, are undecided.

Source: Senate Obamacare repeal on brink of defeat – POLITICO

Imperiling the Better Care Reconciliation Act of 2017 is the politics of Medicaid. In the House, majority Republicans faced an uphill but less steep task in passing their version of the reconciliation bill because proposing to reform Medicaid into a federal block grant program affected far fewer constituents. Because members of the Senate represent their entire states, scaling back Medicaid affects a lot more people and consequently has far greater repercussions and political peril. Since the federal share of Medicaid makes up a large percentage of state budgets, governors are also understandably concerned over the loss of federal share funds.

The backers of the House and Senate bills have bitten off more than they can chew by proposing wholesale reform of the five-decade-old Medicaid program. They’ve made their job even harder by trying to substantially overhaul Medicaid funding at the same time as the Patient Protection and Affordable Care Act’s insurance market reforms — all within the narrow procedural confines of a budget reconciliation bill that make it questionable it would pass parliamentary muster.

 


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email fpilot@pilothealthstrategies.com or call 530-295-1473. 

Nevada governor vetoes “Medicaid for All” measure

Nevada Gov. Brian Sandoval rejected proposed legislation that would have allowed Nevadans to purchase Medicaid managed care plans on the state’s health benefit exchange regardless of household income if they are not otherwise Medicaid eligible.

In a June 16 veto message, Sandoval wrote that due to tight legislative deadlines, there was too little time to thoroughly vet the proposal to establish the Nevada Care Plan within the state’s Medicaid program, noting he had approved legislation authorizing a study of the concept. Sandoval also raised concerns that there would be sufficient providers willing to accept the relatively low Medicaid reimbursements and the possibility of households choosing to purchase Medicaid managed care plans to replace commercial plans.

 


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email fpilot@pilothealthstrategies.com or call 530-295-1473. 

Nevada joins with federal proposals to roll in non-group market

There are efforts at the federal level and now the state level to integrate the problem step child of non-group medical insurance into other forms of insurance to offering greater access at lower cost. The federal proposals would allow individuals not covered in the employer group or other government insurance programs to purchase employer group coverage via the District of Columbia health benefit exchange’s Small Business Health Options (SHOP) and the Federal Employees Health Benefits Program. Pending legislation recently sent to the desk of Nevada Gov. Brian Sandoval takes a different tack. It would authorize the state to seek federal waivers in order to allow Nevadans to purchase Medicaid managed care plan coverage though its health benefit exchange as Vox reported this week. Implicit in both of these moves is a lack of confidence that adequate spread of risk can be achieved in the non-group insurance segment, particularly in smaller states like Nevada.

Noticing the close household income eligibility nexus between its subsidized health benefit exchange and Medicaid populations, Nevada provides Medicaid managed care plans incentive to offer qualified health plans (QHPs) on its exchange to ensure adequate availability of QHPs as Vox’s Sarah Kliff reported in May. With Medicaid enrollments strongly outpacing commercial QHP enrollments in state health benefit exchanges, a number of factors began aligning in 2015 to set the stage for policymakers to allow Medicaid managed care plans to be offered on the exchanges alongside individual Qualified Health Plans (QHPs).

A major question is whether those who enroll in Nevada’s proposed “Medicaid for all” Nevada Care Plan will be able to find medical providers who will accept their plan given the historical shortfall between state Medicaid reimbursement levels and those of Medicare and commercial plans.

 


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email fpilot@pilothealthstrategies.com or call 530-295-1473. 

Study: Single-payer plan would save California $37 billion per year

The new study estimates it would cost California $331 billion to provide health care to everyone living in the state — less than the $368.5 billion spent today in a system that leaves millions without coverage. To pay for it, they say, the state needs to find $106 billion in annual tax revenue — far less than the Senate committee’s estimate of $200 billion. The figures are probably on the optimistic side, said Laurence Baker, a professor of health research and policy at Stanford, because they hinge upon California’s ability to negotiate lower costs with the powerful pharmaceutical industry and other key players, such as hospitals and doctors. “It may be that they could do that,” Baker said, “but getting from where we are now to there would be a tricky, difficult proposition.”

Source: Study: Single-payer plan would save California $37 billion per year

California’s proposed single payer legislation would create a state monopsony that could flex considerable market power with providers of medical services as Baker suggests. But in order to obtain the potential savings it could bargain, the Golden State would have to blow up the current payment pie (illustrated in this post) that carves out slices for different populations and bake a whole new one covering everyone. That’s nothing short of reshaping the entire payer side of the state’s medical care system — a heavy lift considering most people are happy with their slice of the pie with the possible exception of those in the non-group market ineligible for meaningful premium subsidies under the Affordable Care Act.

Then as others have pointed out, there’s the obstacle of getting the Trump administration to approve federal waivers allowing California to redirect those subsidies and Medicare and Medicaid funding to the proposed Healthy California program. The administration is quite favorable to states devising their own schemes for covering those not eligible for group plans and Medicare. But it’s not clear if would go so far as to approve combining all federal medical dollars into a single pot in one state.

 


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email fpilot@pilothealthstrategies.com or call 530-295-1473. 

Fate of 2018 individual market could turn on plan issuer response to proposed Market Stabilization rulemaking

With efforts to enact a successor to the Patient Protection and Affordable Care Act bogging down in the legislative process as health plan issuers must soon make decisions on their participation in the individual market and state health benefit exchanges for plan year 2018, much could ride on the Trump administration’s pending Market Stabilization administrative rulemaking and whether it will instill sufficient market confidence among plan issuers worried about losses and adverse selection. Indeed, the outcome of the rulemaking could well determine whether an individual market exists at all in many states next year as Congress debates changes to the Affordable Care Act’s commercial medical insurance market reforms but also the scope and financing of the six-decade-old Medicaid program.

The Department of Health and Human Services is fast tracking the rulemaking and currently reviewing about 4,000 comments received by the March 7 comment deadline. The scope of the rulemaking would directly apply to plans offered on state health benefit exchanges in states where the federal government operates the exchange or provides the online enrollment platform. As for the dozen states that operate their own exchanges, HHS states in the proposed rulemaking it understands those exchanges may not be able to implement the rule in 2017. It asked for comment on an appropriate transitional period for state-based exchanges and whether the rule should be optional for them. HHS also sought comment on how the rulemaking should apply to plans sold outside the exchanges.

The proposed rule is aimed at reducing the likelihood of enrollee gaming and adverse selection by requiring verification of eligibility for special enrollment periods and supporting continuous enrollment. It would more closely conform individual coverage to employer-sponsored and Medicare coverage by establishing the plan year 2018 open enrollment period as November 1 to December 15, 2017. The rulemaking would require those seeking to enroll outside this period to provide documented evidence of life events such as a change in family status or loss of employer-sponsored coverage. It also would make it easier for health plan issuers to collect lapsed premium payments from the prior year upon renewal, liberalizes the actuarial value definitions of all but silver plans as affords states and plan issuers greater leeway for determining provider network adequacy.

“Continued uncertainty around the future of the markets and concerns regarding the risk pools are two of the primary reasons issuer participation in some areas around the country has been limited,” HHS stated in the preamble to the proposed rule. “The proposed changes in this rule are intended to promote issuer participation in these markets and to address concerns raised by issuers, states, and consumers. We believe such changes would result in broader choices and more affordable coverage.”

While the rulemaking is intended to provide a degree of certainty to plan issuers, it can’t provide a full remedy. The lack of quick legislative progress on an ACA successor has increased the likelihood a federal court ruling finding executive branch funding of out of pocket cost subsidies for silver plans sold on the exchanges unconstitutional will take effect. Implementation of the ruling is temporarily on hold pending legislative action. With both inter and intra party legislative gridlock on health care reform, the Trump administration is far less likely to appeal the decision, allowing it to stand.

 


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email fpilot@pilothealthstrategies.com or call 530-295-1473. 

Macroeconomics underlie debate over ACA successor

Set in the larger context, the current policy debate over a successor to the Patient Protection and Affordable Care Act is grounded in the long term macroeconomics of declining widely shared prosperity and how much federal and state government should chip in to finance the medical care of more lower income households. These are households:

  • Hard hit by the 2008 economic downturn that reduced middle class economic security as the nation seeks a new post-industrial, post-WWII prosperity economy.
  • Not covered by generous employee benefit plans that were commonplace in decades past while at the same time more working age Americans are self-employed and thus ineligible for employee benefit plans.
  • Currently eligible for subsidies for plans sold on state health benefit exchanges and potentially for Medicaid if they live in a state that adopted the Affordable Care Act’s liberalized Medicaid eligibility guidelines.

Members of these households at the low end of the income scale are often lack stable incomes and have members in poor health who utilize a lot of medical services, reinforced by negative social determinants of health. That has contributed to a multi-billion dollar black hole of Medicaid as the program enrollment expanded dramatically, owing to the Affordable Care Act’s expanded eligibility rules.

In a letter to state governors last week, the Trump administration last week explicitly acknowledged the underlying economic challenges contributing to burgeoning Medicaid enrollment. The administration cast Medicaid as complimenting programs to assist low-income adult beneficiaries “improve their economic standing and materially advance in an effort to rise out of poverty,” adding that “[T]he best way to improve the long term health of low income Americans is to empower them with skills and employment.” The letter encourages state Medicaid program proposals “that build on the human dignity that comes with training, employment and independence.”

Heavy medical utilization has also led commercial non-group plan issuers to set premiums so high that those households that purchase non-group coverage are being clobbered by high premiums that rival monthly housing costs. Adding to the sticker shock is the lingering memory of the more generous plans of the HMO salad days of the mid-1970s to the early 2000s as well as individual plans that came with relatively high deductibles in exchange for low premiums. That tradeoff that has since greatly diminished with both premiums and deductibles high, stoking righteous anger against the Affordable Care Act’s non-group market reforms as well as resentment of those who qualify for Medicaid or substantial subsidies for exchange plans.

Simmering beneath the strum und drang of payer side policy is a coming pricing crisis on the provider side. With payers and households feeling pinched and even bankrupted by the cost of medical care and with dollars to pay for it in shorter supply and potentially being more restricted in the current administration and Congress (as well as by employers looking to cut employee benefit costs), substantial pressure will build on providers to reduce what they charge for services. That pressure will take on one or both forms as either falling demand based on the economic principle of price elasticity that holds as prices increase, demand falls — with high out of pocket costs aiding that dynamic. Or government expanding beyond Medicare its role as price arbiter or becoming a monopsony. It would easy to rationalize the latter since under the current split system of payers and providers negotiating reimbursement rates, price signals don’t pass directly between the providers and consumers of medical care and affords individual consumers little in the way of meaningful bargaining power.

 


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email fpilot@pilothealthstrategies.com or call 530-295-1473. 

To “401 percenters” Affordable Care Act isn’t

WASHINGTON (AP) — Michael Schwarz is a self-employed business owner who buys his own health insurance. The subsidized coverage “Obamacare” offers protection from life’s unpredictable changes and freedom to pursue his vocation, he says.Brett Dorsch is also self-employed and buys his own health insurance. But he gets no financial break from the Affordable Care Act. “To me, it’s just been a big lie,” Dorsch says, forcing him to pay more for less coverage.Schwarz and Dorsch represent two Americas, pulling farther apart over former President Barack Obama’s health care law. Known as the ACA, the law rewrote the rules for people buying their own health insurance, creating winners and losers.Those with financial subsidies now fear being harmed by President Donald Trump and Republicans intent on repealing and replacing the ACA. But other consumers who also buy their own insurance and don’t qualify for financial help feel short-changed by Obama’s law. They’re hoping repeal will mean relief from rising premiums.

Source: News from The Associated Press

This is one of the major weaknesses of the Affordable Care Act’s reforms of the individual medical insurance market. Naturally, households earning in excess of 400 percent of federal poverty and who don’t qualify for subsidies are going to be unhappy since they bear the full brunt of premium increases as health plan issuers try to stabilize the market segment under the the law’s provisions by raising premiums. It’s no surprise these 401 percenters as I dubbed them aren’t in favor of keeping those rules in place since from their perspective, they’ve gotten a raw deal other than appreciating the rule requiring plans to accept them regardless of medical history.

The situation also points up the problem of a means-tested scenario of providing medical coverage to those not covered by employer-sponsored plans or Medicare. It’s far from seamless under the Affordable Care Act. The law created multiple categories of benefits and costs for this cohort keyed to household income: 1) Medicaid; 2) Qualified Health Plans offered on state health benefit exchanges with subsidies based on multiple income tranches; and 3) Unsubsidized plans, typically sold outside of the exchanges.

A more elegant, unified scenario is sorely needed, particularly given more households now rely on earnings outside of formal employment arrangements that come with medical benefits or are employed by small employers offering little or minimal coverage.

 


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email fpilot@pilothealthstrategies.com or call 530-295-1473. 

Massachusetts governor proposes Medicaid “fair share” fee on employers not providing minimum medical coverage

In order to discourage avoidable enrollment in MassHealth and slow rising costs in the state’s Medicaid program, which now accounts for nearly 40 percent of state spending, Baker has proposed in his budget a $2,000 per employee “fair share” assessment on Massachusetts employers with 11 or more full-time equivalent employees (FTE), or employees that work 35 hours per week, whose health coverage does not meet certain requirements. The Baker Administration has argued that some of the increase in MassHealth spending is driven by employed individuals enrolling in MassHealth rather than employer-sponsored insurance, and Baker’s proposal aims to reverse this trend.

Source: 2017 Health Care Policy Debates Ramp Up in Massachusetts – Lexology

 


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email fpilot@pilothealthstrategies.com or call 530-295-1473. 

Individual health insurance segment will continue to face existential crisis post-election

Source: Health Affairs Blog. http://healthaffairs.org/blog/2017/02/08/the-marketplace-premiums-increase-underwriting-cycle-or-death-spiral/

 

Regardless of what the incoming Trump administration and Congress opt to do with the Patient Protection and Affordable Care Act’s reforms of the individual health insurance market, the segment will continue to face an existential crisis. The individual market remains the problem stepchild of health coverage, playing an important but relatively minor role in a siloed scheme dominated by employer sponsored coverage for a solid majority of those under age 65 and the big government entitlement programs of Medicare and Medicaid for most of the rest. Not to mention the other integrated government run care systems for active duty military members and their dependents and military veterans.

Given its place in the overall scheme of things, individual health insurance is the remainder market of last resort for those not covered by the dominant private and public systems. It functions as a high turnover, temporary segment that’s inherently unstable. People move in and out of coverage due to changing life circumstances or obtaining eligibility for coverage under one of the dominant systems. Others possess a deeply ingrained “culture of coping” as some have termed it to get medical care where it’s the most easily accessible and affordable such as hospital emergency departments, community clinics and free care events. That coping culture includes avoiding paying for individual health insurance, a pattern in place decades before the Affordable Care Act’s individual market reforms went into effect in 2014. It’s not going to be changed quickly even as health plan issuers are required to accept all applicants without regard to medical history and the law provides subsidies for premiums and out of pocket expenses to low and moderate income households.

That instability makes it very challenging for the basic insurance principle of risk spreading since the risk being insured against is highly dynamic. Actuaries base their projections on relatively stable risk pools and flows of premium dollars into the pool. As long as “covered lives” are moving in and out of the individual market, that desired actuarial predictability will remain elusive, the Affordable Care Act’s carrots and sticks aimed at stabilizing the pool notwithstanding.

As policymakers reassess the Affordable Care Act health insurance market reforms in the post-election period, they might well reexamine an assumption of the law that small group coverage would be eclipsed by the reformed individual market. It was expected that by making individual market coverage more like small group coverage by establishing small group plans as benchmark plans, that along with the individual market reforms would drive more people into individual coverage.

It hasn’t quite worked out that way. Even though the Affordable Care Act does not mandate they do so, small employers are continuing to offer group coverage, albeit less generous than the recent past and more akin to major medical, catastrophic plans with high deductibles. If they are offered coverage under them, employees have little incentive to enroll in individual coverage since they would not qualify for subsidized coverage sold on state health benefit exchanges.

That circumstance reduces the potential size of the individual segment and in so doing, degrades the individual market risk pool. While the Obama administration’s health insurance reforms are based on keeping employer-sponsored health benefits as the bedrock of coverage for most pre-retirement Americans, they also were aimed at revitalizing the struggling individual market. Given that employer-sponsored coverage cuts against a robust individual health insurance space, it may not be possible to have both.

 


Need a speaker or webinar presenter on the Affordable Care Act and the outlook for health care reform? Contact Pilot Healthcare Strategies Principal Fred Pilot by email fpilot@pilothealthstrategies.com or call 530-295-1473. 

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