Monday, March 02, 2015

Well, Ezra Klein, Republicans may not have "plan" to save insurance markets after King. But they may deal

Republican Senators Orrin Hatch Lamar Alexander John Barrasso are out today with a lightly sketched "plan" to salvage premium subsidies credited through the ACA's federal exchange if the Supreme Court rules for the plaintiffs in King v. Burwell.  The proposal closely resembles the  possible post-King negotiation that former HHS Secretary Michael Leavitt outlined to me. Here's Hatch et al:
First and most important: We would provide financial assistance to help Americans keep the coverage they picked for a transitional period. It would be unfair to allow families to lose their coverage, particularly in the middle of the year....

Second, we will give states the freedom and flexibility to create better, more competitive health insurance markets offering more options and different choices. Republicans understand that what works in Utah is different from what works in Tennessee or Wyoming. We want to give states the time and flexibility to design health-care systems that work for them, not for the bureaucrats in Washington.

People who live in states that have state exchanges will continue to be subject to Obamacare’s costly mandates and rules, along with the subsidies. But their states could also have the benefit of our solution. Every state would have the ability to create better markets suited to the needs of their citizens.
And here's Leavitt last week:

Sunday, March 01, 2015

Republican can do what they will to American healthcare -- by accepting the Affordable Care Act

Ask Republicans how they will reform the health insurance market if they succeed in repealing the Affordable Care Act and you will not get a substantive "replace" plan. You will, however, hear three desiderata: 1) give states more control of their insurance markets; 2) give insurers more freedom to design plans outside ACA-imposed constraints; and 3) give consumers in the individual insurance market more choice (though the ACA marketplace shelves in most regions at present are not what you would call bare).

If Republicans were sincere about changing the market in this direction, they would have enormous leverage to do so, both by working within the ACA's essentially federalist (or "state-deferential") structure and by negotiating changes to the law that Democrats would surely accept in exchange for an end to dead-end opposition.

Let's count the ways that Republicans in state government and Congress could shape the health insurance markets to their liking, starting with the tamest and moving toward the most aggressive.

Saturday, February 28, 2015

Three signs the ACA private plan marketplace is working

Over at, I've noted them: 1) more "active renewals" than expected; 2) relatively low churn; and 3) a high level of takeup for Cost Sharing Reduction (CSR) subsidies -- that is, silver plan selection by buyers with incomes under 200% of the Federal Poverty Level. My takeaway:
Many healthcare professionals and scholars worry that a market providing choice from a large selection of private health plans with a complex array of features and coverage rules offers too much complexity for typical buyers, most of whom are on the lower end of the income scale.

Friday, February 27, 2015

King v. Burwell and Congress v. P5 + 1

Reading friend-of-the-hawks reporter Josh Rogin's account of the difficulties Obama may have getting Iran to agree to a deal that bypasses the U.S. Congress, and so could be overturned by a future (GOP) president, I was reminded of GOP demands that the administration float "contingency" plans in case  the Supreme Court destroys the Affordable Care Act by ruling for the plaintiffs in King v. Burwell.

In both cases, bad-faith opposition to vital and viable policy, the product of immense collective effort and years in the making, may well succeed. In both cases, the saboteurs are demanding a collaboration they've rendered impossible.

Tuesday, February 24, 2015

Gallup misreads its state ACA data: state-run marketplaces no better at reaching uninsured

Gallup does a great service in tracking the decline in the uninsured rate state-by-state since ACA implementation. But they draw a misleading conclusion from their latest data set:
Collectively, the uninsured rate in states that have chosen to expand Medicaid and set up their own state exchanges or partnerships in the health insurance marketplace declined significantly more last year than the rate in states that did not take these steps. The uninsured rate declined 4.8 points in the 21 states that implemented both of these measures, compared with a 2.7-point drop across the 29 states that have implemented only one or neither of these actions.
In fact, the superior overall performance of these states in reducing un-insurance is due entirely to the Medicaid expansion. Collectively, their exchanges did not perform particularly well with regard to enrolling subsidy-eligible residents in private health plans.

Compare Gallup's chart highlighting state leaders in reaching the uninsured population by both means (Medicaid and private plans) with the Kaiser Family Foundation's snapshot of states that reached the highest percentage of subsidy-eligible private plan buyers. [Update: The initial comparison is of uninsured rates from poll data taken by Gallup throughout 2014 with Kaiser's up-to-date ranking of performance in the QHP market (through 2/15/15). Kaiser's 2014 ranking appears at bottom.]

Monday, February 23, 2015

Michael Leavitt envisions a post-King negotiation to amend the ACA

If the Supreme Court upholds the plaintiffs in King v. Burwell and thus cripples the ACA exchanges in three quarters of the states, what then? Neither side is talking about how they might compromise to avoid de-insuring 7 million Americans and crippling the insurance market. But Michael Leavitt -- former HHS Secretary under George W. Bush, former 3-term governor of Utah, current CEO of an eponymous healthcare consultancy -- goes there, in an interview with me, now up on Here's the core of what he envisions:
[A] possibility would be to take the current subsidy structure, but allow people who qualify for a subsidy to get it not just in a state exchange but in a private exchange that may be authorized by the state. Multiple private exchanges might begin to pop up. You’d end up with  a competitive marketplace with many more exchanges and lots more innovation.
I hope you'll read the whole thing.  And then, perhaps, a prior interview I conducted with Leavitt last June about the scope for state innovation in healthcare that the ACA does provide. And while you're at it, a  January 2014 Leavitt interview with Julie Appleby of KHN in which he expressed considerable empathy for the HHS officials trying to get the ACA implemented.

P.S. My own take on conservative demands for less regulation and more "innovation" in health insurance, probably inspired in part by this interview (though more immediately by Ross Douthat's column on conservative policy proposals), is in the prior post.

Sunday, February 22, 2015

Conservative reform of the ACA: cutting strings at different ends

When those few conservatives who would genuinely like to see affordable health insurance available to all Americans -- and the many Republican office holders who pretend to -- float alternatives to the Affordable Care Act, they talk about making insurance more affordable, about offering more choice and flexibility to insurers and hence to customers.

Giving insurers more flexibility generally means three things. First, reducing or eliminating the ACA's federally mandated Essential Health Benefits (EHBs) -- which include mental health, drug treatment, childbirth and children's dental coverages that many people might plausibly protest they don't need. Second, allowing sale of plans with lower actuarial values -- the percentage of the average user's annual medical costs paid by the plan -- than the ACA allows. The law sets a floor of 60% AV in both the employer and individual markets and, in the exchanges, establishes silver-level 70% AV plans as the benchmark to which subsidies and Cost Sharing Reduction subsidies (boosting AV for lower income buyers) are tied. Third, widening the allowable price variation according to the plan holder's age and allowing price variation according to sex.

There's much less here than meets the eye.