What the New Health Insurance Law Means for My Workers
By PAUL DOWNS
STAYING ALIVE
The struggles of a business trying to survive.
After working on our health insurance renewals for more than a month, I finally presented my findings to my workers the first week in December. Like many people, I have never paid much attention to how health insurance works. It was a challenge to understand it and an even bigger challenge to explain it. I needed to find language that conveys the essence of our system without getting too technical. If you are trying to do the same with your employees, the following recap may be helpful.
In America, I told my workers, health insurance pays for three kinds of care: routine, chronic and catastrophic. Under the old system, my company bought a single policy and used it to pay for all three. And as a business owner, I got to choose whatever policy I thought was best but without good information about the various plans that were available. I pretty much went with what my agent told me.
I also had no idea what our premiums might be from year to year. The insurance companies could jack our rates up or down for any number of reasons without explanation — although it appeared that if someone in the company got sick, we could expect a large increase in premiums the next year. So we always had that hanging over our heads.
Now, the Affordable Care Act has removed that risk. In the future, our costs will be driven by the overall average costs of the local population. The new law has also imposed some standards on what an insurance policy can be, so that every person can count on a basic basket of services. This kind of regulation is something the government does in many parts of the economy. When you take a bite of a hot dog, you can be reasonably sure that you aren’t eating horse, dog or kitten. We never had that kind of assurance in the insurance market.
The struggles of a business trying to survive.
After working on our health insurance renewals for more than a month, I finally presented my findings to my workers the first week in December. Like many people, I have never paid much attention to how health insurance works. It was a challenge to understand it and an even bigger challenge to explain it. I needed to find language that conveys the essence of our system without getting too technical. If you are trying to do the same with your employees, the following recap may be helpful.
In America, I told my workers, health insurance pays for three kinds of care: routine, chronic and catastrophic. Under the old system, my company bought a single policy and used it to pay for all three. And as a business owner, I got to choose whatever policy I thought was best but without good information about the various plans that were available. I pretty much went with what my agent told me.
I also had no idea what our premiums might be from year to year. The insurance companies could jack our rates up or down for any number of reasons without explanation — although it appeared that if someone in the company got sick, we could expect a large increase in premiums the next year. So we always had that hanging over our heads.
Now, the Affordable Care Act has removed that risk. In the future, our costs will be driven by the overall average costs of the local population. The new law has also imposed some standards on what an insurance policy can be, so that every person can count on a basic basket of services. This kind of regulation is something the government does in many parts of the economy. When you take a bite of a hot dog, you can be reasonably sure that you aren’t eating horse, dog or kitten. We never had that kind of assurance in the insurance market.
ObamaCare and Its Opportunity Costs
Posted on December 10, 2013 by
By Lambert Strether of Corrente.
The key point to remember in all discussions of ObamaCare is that neither it, nor indeed the entire private health insurance “industry,” should exist. They are rent-seeking parasites, economic tapeworms. One does not improve a tapeworm; one removes it.
To understand this simple point, all we need to do is look north to Canada, where we see a single payer system — they call it “Medicare” — delivering equal or better health outcomes atdramatically lower cost, without a health insurance industry, and without ObamaCare’s bizarre, mystifying, and above all unfair Rube Goldberg-esque complexity. In fact, if we’d passed HR 676 in 2009, we would have saved hundreds of billions of dollars by now (more than enough to cover everyone) and thousands of lives, though ObamaCare apologists don’t like to talk much about the excess deaths that ObamaCare’s achingly slow rollout caused and is still causing.
So, the squillions and the deaths are two opportunity costs of going the ObamaCare route. But there are three other opportunity costs, each of which comes from the process of entrenching ObamaCare into our political economy, and making it harder to replace with anything better. So there are, as it were, three hooks by which the tapeworm fastens itself to the body of its host, before it begins to feed (or extract its rent).
The first and most obvious opportunity cost of ObamaCare could — if ObamaCare entrenches itself — be “government health care” (if we define, as most Americans would, government-run health care as like Medicare here or in Canada, where the government is the single payer, and not like the UK’s National Health Service, where doctors are government employees).[1] Here’s an example of what I mean:
Medicaid Outpaces Private Plans
By THE EDITORIAL BOARD
After a botched start, the number of people signing up for health insurance plans under the Affordable Care Act has accelerated greatly, with the most substantial gains occurring in Medicaid programs for the poor.
Federal health officials announced on Wednesday that some 1.2 million people selected plans on federal or state exchanges during the months of October and November. That included 803,000 people who applied to the exchanges and were found eligible for Medicaid or a related Children’s Health Insurance Program that provide public insurance for the poor — in addition to nearly 365,000 people who chose private plans.
Outside the exchanges, there has also been an increase in applications sent directly to state agencies that run Medicaid and CHIP. Applications were up 15.5 percent in October in states that are expanding their Medicaid programs and up 4.1 percent in states that are not.
Under the Affordable Care Act, states are authorized to expand Medicaid, with the help of extremely generous federal subsidies, to cover residents with incomes at or below 133 percent of the federal poverty level, or about $15,280 for an individual and $31,320 for a family of four. Twenty-five states and the District of Columbia are expanding their programs. The others, led mostly by Republican governors, have taken no action or adamantly refused to expand, either because they are politically opposed to the health care reform law or fear their small share of the costs would strain state budgets.
Medicaid enrollments have not been completely smooth. There are still glitches in the computer systems that are supposed to transfer data about applicants and their eligibility for Medicaid to the states, but federal officials are working on ways to ease that problem.
For people with incomes too high for Medicaid, enrollment appears to be getting much easier as repairs are made to the federal website. The number of people who chose private health plans through the federally run exchanges was four times as high in November as in October, and the number who chose private plans through state-run exchanges also increased substantially, not quite doubling from October to November.
At the current rate, more than a million people may select private health plans by Jan. 1, the earliest date the new policies can take effect. That’s fewer than the administration had originally hoped, but surprisingly robust given the start-up troubles.
Developing Cures or Hyping Up Demand?
From the laboratory to the medicine cabinet, drug companies have played a role in each stage of the development, testing, marketing and prescription of drugs to treat attention deficit hyperactivity disorder. Some have said that role, with A.D.H.D. drugs and others, has been too great, driving up demand and use beyond what is medically sensible.
Can drug companies’ influence over treatments for medical conditions like A.D.H.D. be reduced?
We Are Not All in This Together
By SHAMUS KHAN
Rising income inequality troubles Americans. Some of us worry that the fate of the many has become divorced from the fortunes of the few. Others are concerned that the government will attack inequality by taking their hard-earned money and giving it to the less virtuous.
What both sides seem to agree on is that from the late 1940s until the early 1970s things were different. Those coming home from the war entered college in record numbers, which fueled a generation of economic growth. As each year passed, a majority of Americans were economically better off. Incipient political movements that confronted racial oppression and gender discrimination flourished.
Today, when we try to imagine our ideal future, we often turn to this unique moment of our past in which the expansion of rights, the advancement of the economy, and the march toward equality appeared to constitute the defining trinity of American life.
The Obama administration has done little to push back directly against the rise of inequality. But earlier this month, in a speech announcing his plans to dedicate the rest of his term to the problem, Mr. Obama joined the chorus in suggesting that we turn to postwar America for answers. Yet perhaps we are yearning for a past that, in terms of its dynamics, is not terribly different from the present.
During our golden age not all Americans experienced the same kind of growth and mobility. The richest among us saw their share of the national income decline. They were also stagnant: in comparison to their counterparts in other periods in the 20th century, a higher proportion of the wealthiest Americans had inherited their money rather than earned it.
During our golden age not all Americans experienced the same kind of growth and mobility. The richest among us saw their share of the national income decline. They were also stagnant: in comparison to their counterparts in other periods in the 20th century, a higher proportion of the wealthiest Americans had inherited their money rather than earned it.
Doesn’t the fact that millions of Americans were better off more than counterbalance the fact that a few rich people weren’t rising so quickly? I certainly think so. But America’s golden age of parity and today’s winner-take-all society have something in common. The economic experiences of the many and of the few are the opposite of each other.
Why Inequality Matters
By PAUL KRUGMAN
Rising inequality isn’t a new concern. Oliver Stone’s movie “Wall Street,” with its portrayal of a rising plutocracy insisting that greed is good, was released in 1987. But politicians, intimidated by cries of “class warfare,” have shied away from making a major issue out of the ever-growing gap between the rich and the rest.
That may, however, be changing. We can argue about the significance of Bill de Blasio’s victory in the New York mayoral race or of Elizabeth Warren’s endorsement of Social Security expansion. And we have yet to see whether President Obama’s declaration that inequality is “the defining challenge of our age” will translate into policy changes. Still, the discussion has shifted enough to produce a backlash from pundits arguing that inequality isn’t that big a deal.
They’re wrong.
The best argument for putting inequality on the back burner is the depressed state of the economy. Isn’t it more important to restore economic growth than to worry about how the gains from growth are distributed?
Well, no. First of all, even if you look only at the direct impact of rising inequality on middle-class Americans, it is indeed a very big deal. Beyond that, inequality probably played an important role in creating our economic mess, and has played a crucial role in our failure to clean it up.
Start with the numbers. On average, Americans remain a lot poorer today than they were before the economic crisis. For the bottom 90 percent of families, this impoverishment reflects both a shrinking economic pie and a declining share of that pie. Which mattered more? The answer, amazingly, is that they’re more or less comparable — that is, inequality is rising so fast that over the past six years it has been as big a drag on ordinary American incomes as poor economic performance, even though those years include the worst economic slump since the 1930s.
And if you take a longer perspective, rising inequality becomes by far the most important single factor behind lagging middle-class incomes.
G.O.P. Firebrands Tone Down Their Message and Run Again
By JENNIFER STEINHAUER
LIBERTYVILLE, Ill. — “My name is Congressman Bob Dold!” said the fleece-clad man making his way through a popular restaurant here.
Well, not exactly. His name is Bob Dold, but he isn’t a current member of Congress. He’s a former congressman who represented the 10th District of Illinois. “And I’d like to again,” he tells a table of diners about to tuck into a giant cheese crepe.
Mr. Dold is seeking a political resurrection in next November’s election, after just one term on Capitol Hill. After riding the Tea Party wave to Washington in 2010, he was swept out of office by the Obama tsunami in Illinois in 2012.
Now he is among at least nine Republicans, a mix of former incumbents and previous challengers, who are running again — but with a difference. This time they have shelved their incendiary remarks about President Obama and the national debt in favor of a narrower focus on the Affordable Care Act, which they hope will attract moderate voters from both parties, even in heavily Democratic districts, who are disenchanted with its rollout.
The campaigns, if successful, could be an indication of change in some corners of the Republican Party as many former firebrands mellow their messages and people like Mr. Dold, who benefited from the Tea Party but was one of the more moderate members of the House, try to capitalize on the center. At the very least, their campaigns show that some people who ran vociferously against Washington appear eager to get back there.
They figure their odds of winning next year are much better in a nonpresidential election without Mr. Obama at the top of the Democratic ticket.
Our View: Maine can improve its health rankings
Fixing the problems that make many of us sick is within our control.
Maine got some bad news last week with the release of America’s Health Rankings 2013, a report that ranks the states by various measures of the health of their residents.
Using data from the U.S. Centers for Disease Control and Prevention, the American Medical Association and the FBI, the report grades the states on the physical and behavioral traits that lead to good health.
While Maine stayed in the top third of states overall, it slipped in a handful of categories that could make a big difference in years to come.
Maine fell from 18th place to 33rd place for binge drinking; 25th place to 28th place for obesity; and 37th place to 39th place for cancer deaths. There was a slight improvement in percentage of smokers (from 33rd place to 29th place), but it remained high, keeping Maine on the wrong end of the scale.
Along with our aging population, the unhealthy behaviors that lead to these rankings take away from the quality of life of too many of our residents and create a financial burden for us all. Delivering health care is expensive in Maine, and when individuals avoid developing health problems, not only are they better off, but so are the rest of us.
How fewer tonsils in NH, more CT scans in Maine mean we’re getting too much health care
Posted Dec. 16, 2013, at 12:21 p.m.
If you grow up near Dover, N.H., you’re three times more likely to have your tonsils removed than a child growing up near Bangor. But a Bangor-area child is 2.5 times more likely than a child in Lebanon, N.H., to receive an abdominal CT scan.
Those are among the conclusions of researchers from the Dartmouth Atlas Project in New Hampshire, who examined health insurance claims data for children in Maine, New Hampshire and Vermont to learn about the variability of children’s health care by region.
Their analysis confirmed a fact well known in the medical community: Certain routine procedures are more common in particular areas than others. Further, the reason isn’t because of greater medical need in one area than another. A region’s prevailing medical culture — not what the scientific evidence says is best practice — has a greater influence on how often doctors order particular procedures.
What do these insights add to the debate about health care in the U.S.? While limited access to care is genuinely a problem for some regions, the data point to the reality that many in the U.S. receive too much health care. Excessive care not only inflates spending; it can expose patients to unnecessary risks and side effects — such as radiation from excessive imaging.
The Institute of Medicine in 2012 estimated about 30 percent of health care spending in the U.S. — which reached $2.7 trillion in 2011 — pays for unneeded care that doesn’t improve patient health. In a 2011 survey published in the Archives of Internal Medicine, 42 percent of primary care physicians thought patients in their own practices received too much care.
Doctors — particularly specialists — can profit from providing excessive care, especially self-referrals. That’s when the referring physician performs the specialized test, procedure or surgery he or she recommends for his or her patient. And fee-for-service payment systems used by insurers reward health care providers for the quantity rather than quality of care.
Another driver for excessive care is “defensive medicine” — ordering that extra test, procedure or hospital readmission as a precaution to protect doctors from lawsuits. In a 2008 survey of Massachusetts doctors, 83 percent admitted to practicing defensive medicine. That study found 18 to 28 percent of tests, procedures and referrals were ordered to avoid lawsuits.
The United States’ per-capita health spending dwarfs that of its industrialized peers, without the improved outcomes to go along with it. Yet growth in health spending has slowed over the past three years to the slowest three-year growth rate on record.
The reasons why could hold some of the answers for how the nation can rein in its spending on unneeded care. Particularly, measures that hold health care providers accountable for their patients’ overall health — many of them included in the federal Affordable Care Act — should be applied more broadly.
Under the Affordable Care Act, for example, Medicare has started penalizing hospitals with high rates of patient readmissions within a month of being discharged. This not only directly lowers Medicare spending. It provides hospitals with an incentive to improve the quality of care.
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