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Wednesday, March 19, 2014

Health Care Reform Articles - March 19, 2014

The Irony of ObamaCare:
Making Inequality Worse
The Irony of ObamaCare: Making Inequality Worse
The promise of Obamacare was the right one and the hope for extending healthcare coverage to the un-and under-insured a step in the right direction. Yet the unintended consequences will hit the average, hard-working American where it hurts: in the wallet. Currently a national dialogue is emerging by all political parties on the issue of income inequality. That is a debate worth having. The White House and Congressional Democrats are “resetting” the domestic agenda following the negative fallout from the rollout of the ACA. They plan to shift focus from health care to bread and butter issues of income inequality that have eroded the American paycheck for decades.
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Obama Presses Case for Health Law and Wage Increase
—New York Times, December 4, 2013
Ironically, the Administration’s own signature healthcare victory poses one of the most immediate challenges to redressing inequality. Yes, the Affordable Care Act will help many more Americans gain some health insurance coverage, a significant step forward for equality. At the same time, without smart fixes, the ACA threatens the middle class with higher premiums, loss of hours, and a shift to part-time work and less comprehensive coverage.
  • Transferring A Trillion Dollars in Wealth: Most of the ACA’s $965 billion in subsidies will go directly to commercial insurance companies, one of the largest transfers of public wealth to private hands ever. Since the ACA passed, the average stock price of the big for-profit health insurers doubled, their top executives were paid more than a half billion dollars in cash and stock options, and in the past 2 years, the top 10 insurers have spent $25 billion on mergers and acquisitions.
  • Strangling Fair Competition: Before reform, different types of health plans were regulated under different bodies of law. The Obama Administration has blocked many non-profit health funds from competing for the law’s proposed trillion dollars in subsidies by refusing to set fair regulations for different types of plans. The unbalanced playing field will give employers of people covered by these plans powerful incentives to drop coverage.
  • Moving to Part Time Work: The Administration’s experts say employers won’t follow the incentives and drop coverage. But they also told the nation that employers would not cut workers’ hours to get below the 30-hour per week threshold for “full time” work, even as 388 employers announced hours cuts since early 2012.
  • Cutting People’s Pay: If employers follow the incentives in the law, they will push families onto the exchanges to buy coverage. This will force low-wage service industry employees to spend $2.00, $3.00 or even $5.00 an hour of their pay to buy similar coverage.
    http://www.unitehere.org/files/unitehere-obamacare-report.pdf

Silly Republican Insurance Reform Ideas––Selling Insurance Across State Lines and Association Health Plans

There are news reports indicating Republicans will be proposing such longstanding health insurance reform ideas as selling insurance across state lines and association health plans.

These ideas have been around for some time and have served Republicans as convenient talking points out on the campaign trail positioned as common sense alternatives to Obamacare.

When I discuss these ideas with people in the insurance industry––people who know how their market really works––these ideas generally command plenty of snickers.

Selling Insurance Across State Lines
Presumably, Republicans are targeting the many state benefit mandates that drive health insurance policy prices up. The idea is to allow the sale of policies from states with the fewest benefit mandates to be able to be sold in a high mandate state––thereby encouraging the state with more mandates to curtail them.

There are a number of problems with this idea:
  1. IF it did attract new carriers to a market, it would be a great way to blow up an existing health insurance market––for example, the high market share legacy Blue Cross plan whose business is in compliance with all of the existing state benefit mandates. A new carrier could conceivably come into the market with much lower rates––because it is offering fewer benefits––attracting the healthy people out of the old more regulated pool leaving the legacy carrier with a sicker pool. Stripping down a health plan is a great time tested way for a predatory insurance company to attract the healthiest consumers at the expense of the legacy carrier who is left with the sickest.
  2. It's a 1990s idea that fails to recognize the business a health plan is in in 2014. Health plans don't just cross a state line and set up their business like they did decades ago when the insurance license and an ability to play claims was a all a carrier needed to do business. This idea was first suggested by the last of the insurance industry cherry pickers back in the 1990s and it has long outlasted its relevance. Building a new health plan in a market can easily cost hundreds of millions of dollars over a plan's first few years of operation. The most important thing a health plan now offers is not an insurance contract but rather a comprehensively managed provider network. Just look at the capital costs for the new co-ops under Obamacare that are often receiving something approaching $100 million each to set up a new plan. Georgia, for example, passed such a law in 2011 and not a single new carrier entered the state because going into business in Georgia would be about a lot more than simply having a licensed contract to offer and there just aren't a lot of cherry pickers left to want to exploit this opportunity.
  3. It doesn't solve the problem it identifies. The problem this solution targets is that there are arguably too many benefit mandates unnecessarily driving costs up. So, solve that problem. Why do we even need to enact this convoluted and market obsolete idea? Why even encourage the return of predatory health insurance cherry pickers? Why create a two-tiered market? Why not fix the real problem and create a level playing field for everyone at the same time? I suggest the supporters of this idea first ask the leaders of the insurance industry if they would even do this under the best of circumstances.
Association Health Plans
Small group health insurance costs a lot more than big group health insurance. This idea is based upon the commonsense notion that if you pool lots of small buyers together you can get them lower costs.

Commonsense unless you know how the insurance markets work.
http://healthpolicyandmarket.blogspot.com/2014/03/silly-republican-insurance-reform.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+HealthCarePolicyAndMarketplaceBlog+%28Health+Care+Policy+and+Marketplace+Blog%29

Nine Questions About My New Medical Home



March 17th, 2014 
by Matthew Anderson

Sometime in the past five years — it’s hard for me to say exactly when — I suddenly found myself living in a new home.  I must admit I am still a bit disoriented by how this happened. But it did. People keep telling me that everything will be ok but I am not entirely sure.
For example, in my old home we had occasional family meetings; things are different now. We now have weekly (and monthly) meetings. The many new administrators ask us to complete personality surveys. Once we had to figure out what items we should take from a sinking yacht in the South Pacific (hint: the $100 bill will be useful). Another time we had to decide if we were a “Wow” or a “Thinker.” We are asked to figure out how we can do a better job for them. I guess, like all forms of therapy you don’t get better unless you change.
Despite all these meetings there are a series of things I still don’t understand. I am afraid to raise my hand at the meetings and give the impression I’m a bad sport so I have written my questions down.  Please, please don’t think I am a Luddite who wants to go back to the old home.  In fact, what I dislike most about the new home is precisely the way — even in its differences — it resembles the old home.
1. Is this a home or is it a hostel?
One of the things that drew me to family medicine was the desire to build long-term relationships with families.  I went to weddings and graduations; I was asked to be a godfather. I was there when babies were born and came into bedrooms to declare deaths. I could meet my patients on the street. I had families where I cared for five generations.  At the time insurance companies didn’t generally dictate to people whom they could or could not chose as their doctors. Patients who liked me stayed and those who didn’t went to other doctors. All of this felt something like a home.
All that has changed now.  Pretty much everyone will be on a managed care plan that will limit their choice of providers.  If the system runs as intended, decisions about which doctors patients can see will be made every two years by the rational economic decisions of their employers.  There will be nothing special anymore about the relationship between the doctor and the patient.  As this has been explained to me, it is not really a problem “because you are a member of a team.”
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http://healthaffairs.org/blog/2014/03/17/nine-questions-about-my-new-medical-home/

Morning Plum: What the Obamacare enrollment numbers mean


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