Thursday, June 22, 2017

Trading Medicaid coverage for high deductible private market coverage

The Senate version of the AHCA, the Orwellianly named Better Care Reconciliation Act, does even more fundamental damage to the U.S. healthcare system than the House bill. While it phases out the ACA Medicaid expansion more slowly, stepping down the enhanced federal contribution over several years, it imposes even tighter per capita caps on Medicaid, limiting annual growth to the straight CPI after 2024. The damage to Medicaid will be continuous in perpetuity, barring further legislation.

The BCRA does toss a bone to the dis-insured poor by offering private-market subsidies to those who are shut out of Medicaid. Under the ACA, in the 31 states plus D.C. that accepted the law's Medicaid expansion (rendered optional to states by the Supreme Court), anyone whose household income is below  139% of the Federal Poverty Level (FPL) qualifies for Medicaid, and so not for subsidies in the private plan marketplace (with one class of exceptions*).  In states that refused the expansion -- a possibility not envisioned by the law's drafters -- eligibility for Marketplace subsidies begins at 100% FPL, and those below that level are left out in the cold -- because their state's governors and legislatures wanted it that way.

The BCRA allows people with incomes in 0-100% FPL range to buy a "benchmark" plan for 2% of income, and those in 100-133% FPL range** to buy one for no more than 2.5% of income:

Quick thoughts before the bill hits the tape

The Senate iteration of the AHCA is due out in about 40 minutes. A couple of quick thoughts, brought into focus by David Anderson's "how to read the bill" cheat sheet:

1) Back-loaded per capita caps imposed on Medicaid can theoretically be repealed before they kick in. But if the bill's massive tax cuts are not similarly back-loaded (to improve the CBO score), new tax increases would have to be passed in concert with repeal.

2. The more Republicans fiddle around with and publicly fight over individual market subsidies and rules, the easier they'll likely find it to pass the massive cuts to Medicaid that are the bill's core feature.

3.I can't shake the feeling that McConnell has some trick up his sleeve to make the CBO score a positive shock that helps sweep the moderates into the yes column. A "positive shock" might be a forecast of,, say, a reduction of a mere 8 million in the number of people with insurance by 2026, which Republicans can explain away as a result of personal choices (no mandate coercion) or CBO error.

4. What could that shock be? A cap on the tax exclusion for employer-sponsored insurance? Hard to believe. A little coup within CBO? Don't know how that work. Something else? Nothing?

So much for idle speculation....

Wednesday, June 21, 2017

AHCA would increase New Jersey's uninsured population by 540,000: NJPP Report

540,000 fewer people in New Jersey will have health insurance by 2026 under the American Health Care Act (AHCA) than under current law, according to an updated analysis by Raymond Castro of New Jersey Policy Perspective. The update takes into account the May 24 cost estimate by the Congressional Budget Office (CBO) of the amended AHCA that passed the House on May 4.

Should the AHCA become law, NJPP forecasts:
  • The state uninsurance rate would increase by 50%, from 9.8% to 14.7% in 2026.
  • The uninsurance rate would double in Rodney Frelinghuysen's Congressional district, and more than double in Tom MacArthur's.
  • Almost all of the 562,000 New Jerseyans covered by the ACA Medicaid expansion would lose Medicaid coverage, and about two thirds of them would remain uninsured.
  • About one in ten New Jersey adults would lose Medicaid coverage.
  • The state would lose $28 billion in federal funding over ten years -- $21 billion in Medicaid funding, and $7 billion in reduced Marketplace subsidies.
  • The wealthiest 5 percent of NJ households would receive $13 billion in tax cuts over 10 years.
  • About 100,000 New Jerseyans would lose coverage in the individual market through reduction in subsidies for premiums and out-of-pocket costs.

Tuesday, June 20, 2017

Amend the Senatized AHCA

To help Democrats introduce thousands of amendments before the (Senatized) AHCA comes to a vote, Indivisible is inviting all of us to add our own stories to their amendment*; they'll ask  our senators to make their constituents' testimonials part of the Congressional Record. Contribute here!

With Democratic senators being tasked with offering thousands of amendments, I thought I'd propose a few. Some are mutually exclusive, some would cost money, some would only work under current law, some may be unworkable. Brainstormer's licence...
  1. Nothing in this bill shall be construed to render anyone who was eligible for Medicaid under prior law ineligible.

  2. Congress shall not cap the federal contribution to Medicaid by any formula that reduces the Federal Medical Assistance Percentage (FMAP) in effect prior to enactment of this legislation.

  3. Any insurer that participates in a state's nongroup health insurance market must offer plans on the state Marketplace, in every area where it sells off-Marketplace.

Saturday, June 17, 2017

An American road to single payer

Ezra Klein offers an astute political forecast:
...if Republicans leave Obamacare gutted and the political arguments that led to it in ruins, there’s not going to be a constituency for rebuilding it when Democrats win back power.

Instead, they’ll pass what many of them wanted to pass in the first place: a heavily subsidized buy-in program for Medicare or Medicaid, funded by a tax increase on the rich. A policy like that would fit smoothly through the 51-vote reconciliation process, and it will satisfy an angry party seeking the fastest, most defensible path to restoring the Affordable Care Act’s coverage gains.
A few thoughts:

1. If a Medicaid income-adjusted buy-in were offered only to nonelderly who lack access to employer-sponsored insurance or other government programs, it shouldn't require more funding than the ACA marketplace. OTOH, if the AHCA has passed, Democrats will need to replace the revenue provided by the ACA taxes Republicans will have repealed (close to $900 billion over ten years, rather than the $600+ billion Klein cites, if you include revenue from the repealed ACA mandates).

2. If a buy-in were subsequently offered to employers -- perhaps starting with small employers -- that buy-in would amount to a voluntary payroll tax.

Friday, June 16, 2017

The Medicaid Dismemberment Act

Over at healthinsurance.org, I've made a case that the AHCA is not simply -- or even primarily -- an ACA repeal bill. It's a Medicaid dismemberment bill.  That goes for the Senate variant in progress as well.  Furthermore:
The degree of damage to be wrought by the legislation's various spending reductions is almost the inverse of where media emphasis falls;
and finally
the damage Republicans will likely do to the individual market is dwarfed by the damage they will certainly do (if they pass anything) to Medicaid. Thus all the high drama over medical underwriting and EHBs continues to serve as a smokescreen for Medicaid's dismemberment.
I rank the bill's three primary means of doing violence to existing parts of our healthcare system. Hope you'll take a look. 

Monday, June 12, 2017

Senate "moderates" promised long ago to support the ACA repeal bill in progress

I keep reading that Senators Capito and Portman and Heller, relative Republican "moderates" from states that have embraced the ACA Medicaid expansion,  have reversed themselves by signaling willingness to repeal the expansion if the repeal timeline is stretched out.

Capito may have made some contradictory noises over the last few months, occasionally indicating that she does not want to see the expansion repealed.

But look again at the letter to McConnell that Capito and Portman signed onto just before the House repeal bill, the AHCA, was released.  That letter, which was read as defense of the Medicaid expansion, demanded
that any health care replacement provide states with a stable transition period and the opportunity to gradually phase-in their populations to any new Medicaid financing structure.
In Republican-speak, that means expanding the timeline in which enhanced federal funding for the Medicaid expansion population is phased out -- as the Senate bill will do. I examined the letter's consistency with the course the Senate is undertaking now in more detail in this post.

Saturday, June 10, 2017

Senate Republicans may outspend the ACA on individual market subsidies -- at Medicaid's expense

While Republican senators working on ACA repeal will doubtless screw up the individual market for health insurance, they are not planning to spend less money on it. All of their spending cuts -- needed to pay for tax cuts -- will come out of Medicaid's hide. Since the Medicaid expansion they're planning to repeal is a roaring success, they're following the House in diverting everyone's attention with emotionally fraught questions about individual market structure.

According to Vox's Dylan Scott, Senate Republicans are near agreement on the basic outline of their Medicaid cuts -- they will roll back the expansion over more or less years and impose per capita caps on all Medicaid spending, as Ryan's AHCA does. As for the individual market:
There’s broad agreement to increase the money the House bill would spend subsidizing Americans who buy insurance on the individual market. That increase would probably improve, at least somewhat, the Congressional Budget Office’s projection that the House bill would cause 23 million fewer Americans to have health insurance a decade from now.
In fact, any improvement to the AHCA individual market design and funding will improve CBO's uninsured estimate for the AHCA only marginally. In CBO's forecast, the individual market will insure only two million fewer people under the AHCA than under current law ten years from now (though enrollees will be wealthier, younger and more skimpily covered, and most of the roughly 7 million ACA enrollees with incomes under 200% FPL will likely be priced out).

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