Alarming Abuses of Medical Credit Cards
By THE EDITORIAL BOARD
Patients around the nation are being victimized by medical credit cards that can lead to financial calamity. These cards, issued by specialty finance companies as well as commercial banks, carry exorbitant interest rates after an initial period of zero interest expires — with heavy penalties for late payments. They are often pushed on patients with modest incomes by health care providers who want to make sure that they get paid, even if some of their patients end up with huge credit card bills they can’t afford. Unless strong regulatory action is taken to curb the abuses, financial companies will continue to gouge consumers at their most vulnerable moments, when they are in pain and need medical attention.
Doctors and dentists whose offices arrange for these credit cards say these kinds of loans help patients pay for the care and procedures they need. But it’s hard to imagine a situation in which a consumer is more susceptible to financial coercion by a provider with a conflict of interest.
Patients typically sign up for these credit cards to pay for services like dentistry and devices like hearing aids that are not covered by Medicare or are only partially paid for by private insurance. The doctors get a good deal because they get paid promptly, while patients are often unaware of the harsh terms of this kind of credit until they get the bill.
As Jessica Silver-Greenberg reported in The Times last week, the scope of this problem is growing, as more patients sign up for cards issued through practitioners’ offices by companies like iCare Financial of Atlanta; CareCredit, a unit of General Electric; and banks like Wells Fargo and Citibank. Some patients thought they were agreeing to an in-house payment plan with their dentist’s office when in fact they were taking out a high-cost credit card with a financial institution. Others didn’t realize that the interest rate could skyrocket on bills not paid in full. Some companies don’t check a patient’s credit history or impose upfront charges on the patient, which makes it easy for people to take on extra debt they can’t afford.
The cards typically charge no interest for a promotional period of several months, but after that, the consumer is charged rates of up to 30 percent if the debt is not paid in full. The high rates are often applied to the original amount of the loan, not just to the amount still owed.
Implementing Health Reform: The State Of The Exchanges, Income Verification, And More
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Update, 10:45 PM, October 16: Although the House Republicans began the budget and debt ceiling debate with high hopes of defunding the Affordable Care Act, in the end they achieved almost no changes in the ACA despite shutting down the government for sixteen days and bringing the United States to the brink of default. The only provision of the budget resolution that directly addresses the ACA requires the HHS Secretary to certify to Congress that the exchanges verify eligibility for premium tax credits and cost-sharing reduction payments consistently with the requirements of section 1411 of the ACA. By January 1, 2014, HHS must submit a report to Congress as to how the exchanges are verifying eligibility, and by July 1, 2014, the HHS Office of Inspector General must submit a report to Congress as to the effectiveness of the eligibility procedures and safeguards in place for preventing inaccuracies and fraud.
The referenced Section 1411, however, provides few specifics as to how financial eligibility is to be determined, and further provides, “The Secretary may modify the methods used under the program established by this section for the Exchange and verification of information if the Secretary determines such modifications would reduce the administrative costs and burdens on the applicant.” In sum, HHS may for political reasons choose to enhance verification procedures, but there is nothing in the ACA or in the budget resolution that would require it to do so. In any event, HHS already requires far more to verify exchange eligibility than the IRS often requires to verify eligibility for other tax benefits, which in aggregate probably cost the U.S. Treasury far more money.
It is October 16, 2013 and we are over two weeks into the federal government shut-down and the failed launch of the Affordable Care Act federal marketplace. The two are probably not wholly unrelated. With the nation’s borrowing capacity nearly exhausted, it is hard to believe that Congress will not soon take action to resolve the debt crisis, and, as part of the package, reopen the government. Once the Department of Health and Human Services returns to full staffing, one can only hope that the problems with the federal exchange will be more quickly resolved, although it appears that the problems with the exchange are predominantly the responsibility of private contractors.
It is frustrating that HHS has failed to provide information as to what precisely is wrong with the exchange. Some of the problem is clearly due to the high volume of website visits during the first few days of the exchanges operation — a reported 14.6 million during the first 11 days according to the Administration — but visits have dropped dramatically and problems persist. Moreover, it is becoming increasingly clear that problems persist throughout the enrollment process, and particularly at the back end where applicants are actually supposed to be enrolled with insurers, as Robert Laszewski has been reporting. There has been excellentinvestigative reporting on what is going wrong with the marketplace, but in the end, it is the responsibility of HHS, or perhaps the White House, to explain to the American public what exactly is wrong and when we can expect it to be fixed. This has not yet been done.
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Information collection. Although the government shut down has dramatically limited the flow of ACA implementation issuances, a few continue to emerge. On October 11, 2013, HHS published a notice of information it was intending to collect to establish individual mandate exemptions. The notice includes forms that will be used by the federal exchange and could be used by the state exchanges for collecting this information.
There is nothing new in this notice, but the scope and number of exemptions from the ACA’s individual responsibility requirement are truly impressive. In addition to the religious conscience, health care sharing ministry, incarceration, Native American tribe membership, and lack of affordable coverage exemptions, there is an extensive list of hardship exemptions, including:
- Homelessness;
- Eviction in the previous 6 months or the threat of eviction or foreclosure;
- A utility shut-off notice;
- Recent death of a close family member;
- A fire, flood, or other natural or human-caused disaster that caused substantial property damage;
- A bankruptcy filing in the last 6 months;
- Medical expenses in the past 24 months that could not be paid;
- Unexpected increases in necessary expenses due to caring for an ill, disabled, or aging family member;
- The presence in the household of a child claimed as a tax dependent who was denied coverage in Medicaid and CHIP where another person is required by court order to give medical support to the child. In this case, the penalty need not be paid for the child;
- A favorable eligibility appeals decision that makes an individual eligible for enrollment in a qualified health plan (QHP) through the Exchange, lower the costs on monthly premiums, or provides cost-sharing reductions, which removes the penalty for the time the individual was not enrolled in a QHP through the Exchange; or
- Residence in a state that fails to expand Medicaid if the individual would have been eligible for Medicaid.
HHS estimates that 24 million Americans will be eligible for individual responsibility exemptions and that as many as 12 million will apply for exemptions through the exchange.
Obamacare, Failing Ahead of Schedule
By ROSS DOUTHAT
THIS is not the column about the Obamacare rollout I expected to write.
If you had told me, months ago, that weeks after the health care law’s coverage expansion went into effect I would be writing about the problems its launch had exposed, I would have assumed I’d be writing about rate shock, rising premiums and the disappearance of many cheap insurance plans — basically, all the problems conservatives have worried will make Obamacare a ruinously expensive failure if they play out as we fear they might.
I may be writing about those issues soon enough. But for now there is a more pressing subject: The online federal health care exchange, the heart of the Obamacare project, is such a rolling catastrophe that it may end up creating a major policy fiasco immediately rather than eventually.
This fiasco has always been a possibility, for reasons inherent in the architecture of the law. When The New Republic’s Jonathan Cohn, the most rigorous defender of the entire reform project, wrote up his “five Obamacare anxieties” in May, the first one was structural: The system’s sustainability depends on getting enough healthy people to sign up, he pointed out, and if they don’t then insurers “will have to raise everyone’s premiums,” which “could create what actuaries call a ‘death spiral’: Rising premiums prompt people to drop out, causing premiums to increase even more.”
Cohn thought such a death spiral was unlikely, and frankly so did I. Between the stick of the mandate, the carrot of subsidies and the planned P.R. blitz, it seemed as if enough Americans would sign up to at least postpone the cost problem and get the system off the ground.
But it seemed that way because it was hard to imagine the Obama White House botching the design and execution of its national health care exchange. Building Web sites, mastering the Internet — this is what Team Obama does!
Except this time Team Obama didn’t. Like the Bush administration in Iraq, the White House seems to have invaded the health insurance marketplace with woefully inadequate postinvasion planning, and let the occupation turn into a disaster of hack work and incompetence. Right now, the problems with the exchange Web site appear to be systemic — a mess on the front end, where people are supposed to shop for plans, and also a thicket at the back end, where insurers are supposed to process applications.
The disaster can presumably be fixed. As Cohn pointed out on Friday, many of the state-level exchanges are working better than the federal one, and somewhere there must be a tech-world David Petraeus capable of stabilizing HealthCare.gov. And the White House has some time to work with: weeks before the end-of-year enrollment rush, and months before the mandate’s penalty is supposed to be levied.
Share The Truth About the Obamacare Rollout The feds botched the website. But the states are doing much better.
The federal government is open and paying its bills, which means you can start looking at the other big story from the past few weeks: The startup of Obamacare’s marketplaces. But to fully appreciate what’s happening, you need a split screen.
On one side is the story you’ve heard so much about. In 36 states, the Department of Health and Human Services (HHS) is operating the new insurance marketplaces, where non-elderly people without employer benefits can buy coverage on their own. This part of the rollout has gone … really badly. Two weeks after the sites went online, people are still have trouble setting up accounts and logging onto the system.
HHS is working feverishly to make improvements and the system's performance has improved incrementally. But people are still getting hung up at the initial stages, which means they never get the chance to apply for financial assistance and shop for plans. A study following web traffic showed a sharp drop-off in users at each successive stage of the online application process, which suggests the system was stopping a lot of people from moving forward. And that’s just the part of the system visible to consumers. Insurers say that the system is producing some incorrect information about the few people who make it through the process—a fixable problem, for sure, but a warning that other flaws may yet lurk undetected.
Driving a New Bargain on Health Care
By TYLER COWEN
The Affordable Care Act has gotten off to a rocky start. Federal and state online health insurance exchanges, which opened for business at the beginning of the month, have been bedeviled by technical snags. And opposition to the law from some House Republicans blocked funding for the entire federal government, leading to its partial shutdown.
In fact, with all the conflict and vituperation over Obamacare, it sometimes seems that one of the few things Democrats and Republicans agree on is that the law is imperfect at best. And they also agree that it could be improved. Even if a bipartisan deal to create a better health care system seems far off today, it’s not too soon to start imagining what a future bargain might look like.
Just to get started, I will assume that, at some point, Democrats will be willing to acknowledge that not everything has worked out as planned with the legislation, and that they would consider a rewrite that would expand coverage. I’ll also assume that Republicans will acknowledge that a feasible rewrite of the bill cannot give the Democrats nothing. And Republicans will need to recognize that repeal of Obamacare should not be their obsession, because they would then be leaving the nation with a dysfunctional yet still highly government-oriented health care system, not some lost conservative paradise. Both sides have a lot to gain, and, at some point, they should realize it.
Let’s look at some of the current problems in the health care system and see whether they might be patched up.
Even under Obamacare, many people will not have health insurance coverage, including two-thirds of poor blacks and single mothers and more than half the low-wage workers who lacked coverage before the law was enacted. That is largely because of the unwillingness of 26 governors to expand Medicaid coverage as the original bill had intended. The Supreme Court struck down that portion of the Affordable Care Act, however, giving states a choice.
Will many red-state governors eventually accept the act’s Medicaid extension, which is sometimes portrayed as a financial free lunch, since federal aid covers most of the coverage expansion? It’s not clear that they will. If the Republicans win the White House in 2016 and perhaps the House and Senate as well, they may cut off federal funds for that Medicaid expansion. In the meantime, many states don’t want to extend their Medicaid rolls, because such benefits are hard to withdraw once granted.
LePage signals interest in Medicaid expansion compromise
1:00 AMLegislators are starting to discuss state-designed alternatives.
While Gov. Paul LePage and Democratic lawmakers have sparred over Medicaid expansion for more than a year, a potential compromise could be on the horizon, with the governor now signaling a willingness to consider ideas currently bearing fruit in other states.
Arkansas, Iowa and other states creating new models tend to share a political dynamic similar to Maine – a divided government with Republican governors and Democrats controlling the Legislature, or vice-versa.
LePage spokeswoman Adrienne Bennett told the Maine Sunday Telegram last week that the governor is evaluating substitute plans taking hold in other states. The Republican governor also credited the Democratic Obama administration for being “open to creative solutions.”
http://www.pressherald.com/politics/LePage_signals_interest_in_Medicaid_expansion_compromise_.html?pagenum=full
AP sources: 476,000 Obamacare applications filed
Yesterday at 8:30 PMIt’s unclear whether the program is on track to reach the 7 million people projecting by the Congressional Budget Office to gain coverage during the six-month sign-up period.
By Julie PaceThe Associated Press
WASHINGTON – Administration officials say about 476,000 health insurance applications have been filed through federal and state exchanges, the most detailed measure yet of the problem-plagued rollout of President Barack Obama’s signature legislation.
However, the officials continue to refuse to say how many people have actually enrolled in the insurance markets. Without enrollment figures, it’s unclear whether the program is on track to reach the 7 million people projecting by the Congressional Budget Office to gain coverage during the six-month sign-up period.
Obama’s advisers say the president has been frustrated by the flawed rollout. During one of his daily health care briefings last week, he told advisers assembled in the Oval Office that the administration had to own up to the fact that there were no excuses for not having the website ready to operate as promised.
The president is expected to address the problems on Monday during a health care event at the White House. Cabinet members and other top administration officials will also be traveling around the country in the coming weeks to encourage sign-ups in areas with the highest population of uninsured people.
http://www.pressherald.com/news/AP_sources__476_000_Obamacare_applications_filed_.html
Nearly half million apply for US health insurance despite flaws, officials say
Posted Oct. 20, 2013, at 6:07 a.m.
WASHINGTON — Roughly half a million Americans have applied for health insurance through new federal- and state-run exchanges under President Barack Obama’s signature health care law, an administration official said Saturday.
That figure comes as problems with the federal marketplace’s entry portal serving 36 states, the website Healthcare.gov, have thwarted consumers from shopping for federally subsidized health coverage and drawn derision from Republicans, who oppose the law, popularly known as Obamacare.
The acknowledgement of the number of applicants, late on a weekend evening, appeared to be part of a ramped-up damage control effort by the White House.
Obama’s Patient Protection and Affordable Care Act is expected to provide private health coverage to an estimated 7 million uninsured Americans through the new online marketplaces that opened for enrollment in all 50 states on Oct. 1.
But the Healthcare.gov website was hobbled by technical issues — including error messages, garbled text and loading page delays — that administration officials blame partly on an unexpectedly high volume of 14.6 million visitors in its first several days of activity.
Obama is frustrated by the poor start and told advisers during a recent Oval Office meeting that the administration had to take responsibility for not having the site ready on time, an official said.
“The website is unacceptable, and we are improving it, but the product is good and across the country people are getting access to affordable care starting January 1,” one administration official said.
“We are going to work intensely for the next six months to make sure we meet the demand.”
Another administration official said that among the roughly half a million applicants, more than half lived in states where the federal government was administering the health exchanges in full or in part.
Medicaid gap leaves Obamacare haves and have-nots
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| ALBUQUERQUE, N.M.— April Gomez-Rodriguez hopes Obamacare changes her life. Daniel Hughes says it’s like the health law never happened. The difference between them: one state border. Rodriguez and Hughes are both uninsured. They don’t get coverage through their low-wage jobs, but they don’t qualify for traditional Medicaid. There’s no way they can afford to purchase health insurance on their own. (POLITICO's full Obamacare coverage) But Gomez-Rodriguez, 32, who works with kids at a behavioral health center, lives in New Mexico, where Gov. Susana Martinez was among the first in the GOP to embrace the Medicaid expansion under the Affordable Care Act. On Jan.1, Gomez-Rodriguez and her husband will have health coverage for the first time in years. Hughes, 40, who works in home repair, lives in Texas, where Gov. Rick Perry’s staunch opposition to Medicaid expansion and other key elements of Obamacare shut him out. It wasn’t supposed to be this way. Obamacare was supposed to create a health care safety net from coast to coast, across income levels, putting everyone within reach of health coverage. But in some states, there’s a gaping hole. In half the states, millions of poor people are left out. |
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