Saturday, June 16, 2018

Virginia's CSR load should be cut more than in half in 2019

David Anderson makes a valuable point about an after-effect of latter day Medicaid expansions like Virginia's -- that is, expansion following Trump's cutoff of federal reimbursement to insurers for the Cost Sharing Reduction (CSR) subsidies they are obligated to provide to qualifying ACA marketplace enrollees.  

It's this: now that insurers have to price CSR into premiums, Medicaid expansion will reduce premiums for unsubsidized enrollees by removing much of the CSR load.
Virginia — like many other states — had its insurers load the cost of providing CSR into the premiums for silver plans, which are the plans that set the local benchmark from which all premium subsidies are calculated. This led to a significant spike in silver benchmark premiums. Other plans saw significant but far lower premium increases. On average, CSR workarounds led to an extra $960 to $1,040 in premiums for silver plans.

The data shows us that people who were previously eligible for an ACA health plan and will now be eligible for Medicaid under the expansion were the highest per-capita recipients of the cost-sharing reduction subsidies. As these individuals move to Medicaid expansion, the cost of funding CSR through silver premiums will decline.
As it turns out, we know just about how many current Virginia enrollees with CSR will be eligible for Medicaid if their income doesn't change. CMS data shows that, of Virginia's 400,015 enrollees as of the end of Open Enrollment last December, 222,305 obtained CSR. Of those, 120,898 obtained the highest level of CSR, which raises the actuarial value of a silver plan from a baseline of 70% (which is what silver plans without the CSR load would price for) to 94%.

Friday, June 15, 2018

New Jersey's individual market needs some off-exchange discounts in 2019

Trump's cutoff of federal reimbursement to insurers for Cost Sharing Reduction (CSR) subsidies last fall turbo-charged premium hikes in the individual market in 2018.  Those hikes hit unsubsidized enrollees directly. Yet states that allowed insurers to load the cost of CSR onto on-exchange silver plans only, allowing cheaper silver plans to be sold off-exchange, provided a measure of effective relief to the unsubsidized.

In Philadelphia, an unsubsidized 50 year-old could get the cheapest off-exchange silver plan for $153 per month less ($498/month) than the cheapest on-exchange silver plan (for more closely comparable plans, the spread was $94).  In Baltimore, the cheapest silver plan offered on-exchange for a 50 year-old was $88/month more than the same plan off-exchange ($610 vs. $522).

Not so in New Jersey, where individual market premiums rose a weighted average of 22% in 2018, and still more steeply on market hegemon Horizon Blue Cross's most popular silver plans.* New Jersey did allow "silver loading" -- that is, concentrating the cost of CSR in silver plans only, since CSR is only available in silver plans. But none of the three insurers participating in the state's ACA marketplace offered cheaper silver plans off-exchange, as insurers did in many other states.

In fact, none of the three (Horizon, AmeriHealth, Oscar) sold off-exchange plans that differed in any way from their on-exchange offerings.**

Wednesday, June 13, 2018

Medicare expansion: An elastic idea for Democrats

Politico's Jennifer Haberkorn reports that Democratic candidates are avoiding the term "single payer" when staking out their healthcare positions. That's not only because Republicans use the term as a bogey signaling socialized medicine and socialism generally (they did the same with the much more conservative ACA).  More substantively:
Early last year, the DCCC shared verbal guidance with candidates and political consultants about the liabilities of supporting single payer, including polls that showed support for the idea declined once voters heard that it would likely come with significant tax increases and the potential loss of private health coverage many Americans have today, according to sources who saw the guidance.
Instead, Democrats are being urged to embrace the term "Medicare for All" -- which, taken literally, is single payer. Some candidates speak more cautiously of "a path to Medicare for all," however -- a term that's justifiably ambiguous. Any path to universal coverage in the U.S. is likely to be long, and include several stages and potential branchings -- including toward a system in which a public program is available to all, but some choose other options. A number of Democratic bills and proposals reflect this reality. In recent years, many forms of Medicare expansion have been proposed. They include the following, ranked from the most limited to the most expansive.

Friday, June 08, 2018

When ACA marketplace coverage is cheaper than Medicaid

In my last post, I noted that thanks to Virginia's decision to expand Medicaid, a bit over 100,000 current enrollees in the state's ACA marketplace (or people similarly situated next year) will be switching over to Medicaid in 2019.  Also, since the Republican-tinged expansion terms include premiums ranging from $1/month to 2% of income for people in the 100-138% FPL, some of these people will actually pay more for Medicaid coverage than they do now for marketplace plans.

David Anderson covered this ground in more detail:
A single 40 year old making 138% FPL who buys the benchmark Silver plan pays 2% of their income in premiums which translates to $28 per month. People who expect to be relatively healthy will often elect to buy the least expensive Silver. The APTC subsidy is fixed so the choice to buy a lower cost Silver plan means the a dollar for dollar reduction in out of pocket premiums. Significant portions of Virginia including greater Richmond, exurban NoVA and central Virginia between I-81 and I-95 have a Silver plan that is at least $28 less than the Benchmark Silver. This means that there is a $0 premium plan available for folks who will now be moving to Medicaid with a 2% premium.
A couple of points of elaboration: first, not everyone in the 100-138% FPL income band (the group that has been eligible for marketplace subsidies pre-expansion) will pay 2% of income. Second, a lot of people in this income range currently pay less than 2% of income but more than $0.  Some have $0 deductibles; some have small ones ($150). Yearly out-of-pocket maximums range from $900 to $2000 -- I imagine maximum OOP at least will be lower in Medicaid.

Thursday, June 07, 2018

Virginia Medicaid expansion will cut ACA marketplace enrollment by 100,000-plus

Virginia will enact the ACA Medicaid expansion in 2019 -- it's now law. Hurrah! 400,000 people are expected to gain Medicaid coverage. And that includes about 108,000 people who enrolled in ACA marketplace coverage in 2018 (or rather, those similarly situated next year) -- a bit over a quarter of current enrollment. Judging from enrollment attrition recorded in past years, about 90,000 of the potentially Medicaid eligible are probably enrolled in marketplace plans as of now.

Under the expansion, Virginians with income up to 138% of the Federal Poverty Level (FPL) will be eligible for Medicaid. Pre-expansion (i.e., now), eligibility for marketplace subsidies begins at 100% FPL.  According to CMS public use files, 123,245 enrollees as of the end of Open Enrollment had incomes in the 100-150% FPL range. Most of them -- those with incomes from 100-138% FPL -- will be Medicaid-eligible. 

We know more or less how many. In 2016, the one year in which CMS broke out the 100-138% range separately, 82% of of Virginia enrollees in the 100-150% FPL band proved to be in the narrower "shoulda-been-in-Medicaid" range -- 100-138% FPL. Assuming the same proportions this year suggests 108,000 people who might have enrolled in marketplace coverage in 2019, all other things being equal, who will instead enroll in Medicaid.

Wednesday, June 06, 2018

About that victory lap, PA Insurance Department....

Yesterday, the Pennsylvania Insurance Department proudly announced that insurers in the state's ACA-compliant individual market requested premium increases averaging 4.9% -- compared to 30.6% last year.

Insurance Commissioner Jessica Altman took a victory lap:
Altman attributes the minimal increases to Pennsylvania’s competitive market and the department’s efforts to maintain enrollment in the individual market despite the federal government’s efforts to shorten the ACA’s open enrollment period and curtail enrollment outreach, while working to achieve affordability for consumers. The Insurance Department launched an outreach campaign to make up for a lack of marketing from the federal government during the 2018 open enrollment season.

The department also worked to make coverage more affordable for more consumers by mitigating the number of individuals subject to premium increases when the federal government eliminated cost-sharing reduction reimbursements. As a result, 396,725 Pennsylvanians selected health plans on the exchange in 2018, only a small decline from the previous year.
It may well be true that state action helped minimize enrollment losses and so stabilize the market to a degree. But on the top line at least, that "small decline" was not so small. CMS enrollment figures show a 9% drop in marketplace enrollment in Pennsylvania in 2018 -- compared to 4% nationwide and 5% in the 39 states (including PA) that use the federal exchange, HealthCare.gov.

Monday, June 04, 2018

ACA sabotage boomerang, type 3

Recently, I tallied the various ways that Republican sabotage of ACA programs has either backfired entirely or created means of mitigating the intended damage.

Very briefly, sabotage jacks up individual market premiums, which creates inflated federal subsidies, which can be leveraged both by individuals (via discounted bronze and gold plans) and states (via federally funded reinsurance or other innovation waiver programs). Two states, New Jersey and Vermont, have also turned effective repeal of the federal individual mandate to their advantage by creating state mandates, capturing a revenue stream while holding premiums down.

Late last week, the Washington Post's James Hohmann highlighted another form of sabotage that may also at least partially boomerang: Work requirements attached to Medicaid for "able-bodied" adults. It would be hard to find a policy more universally denounced by anyone with any professional experience or scholarly purview of Medicaid. The programs are cruel,wasteful and counterproductive; they will likely  reduce both coverage and employment. And yet...
As President Trump steps up efforts to undermine the law, from repealing the individual mandate to watering down requirements for what needs to be covered in "association health plans," the administration’s willingness to let states impose work requirements on Medicaid recipients has paradoxically given a rationale for Republicans to flip-flop on an issue where they had dug in their heels.

Friday, June 01, 2018

The old machine hums on

The way we're rigged emotionally, death and disease are inherently tragic. Yet at some level I am amazed by the durability and self-regulation of the human body. It seems very strange that I'm still in the same machine I was in when my consciousness emerged. On the whole, despite all the niggling pains and promptings that go on all day, I'd say the body interferes very little in that consciousness. Every waking moment you're thinking about something, and in most of that nonstop churning you forget you have a body. That's true even if bodily awareness breaks in every ten minutes for, say, five seconds.

Thursday, May 31, 2018

New Jersey takes strong action against ACA sabotage: A look-back

As Republican repeal of the ACA's individual mandate loomed last fall, potential remedies for states became self-evident, notwithstanding many political roadblocks. No one had ever challenged a state's authority to impose an individual mandate. And state reinsurance programs had already proved their worth and obtained federal funding.

New Jersey, with strong Democratic majorities in both houses of the legislature and a newly elected progressive governor, was one likely proving ground -- notwithstanding the mandate's unpopularity and the state's fiscal woes. Progressives committed to a working individual market and resumed progress expanding healthcare access were eager to see these remedies tried -- under the tight schedule imposed by insurers' June 20 deadline to file rate requests. The legislature came through, passing mandate and reinsurance bills on April 12. After a long and rather conspicuous silence, Governor Murphy signed them yesterday.

Below is a compendium of my posts and articles on this front, as well as outside efforts with BlueWaveNJ and the NJ for Health Care Coalition that I've been involved in. They address the fiscal challenges as well as the case for the bills.

Sabotage judo: States can turn individual mandate repeal to their advantage (12/14/18)
Impose a mandate and use the revenue to help fund reinsurance

How Gov. Murphy can protect NJ from Obamacare sabotage (NJ Spotlight, 1/17/18)
Specifics for New Jersey -- e.g. death spirals past

Wednesday, May 30, 2018

NJ for Health Care Coalition urges Gov. Murphy: Protect our care. Sign these bills

Update: Murphy signed both bills today!  The Star-Ledger' Susan Livio cites the Coalition letter linked to below.
----
New Jersey Governor Phil Murphy has been notably quiet about two ACA-defense bills awaiting his signature -- one creating a state individual mandate, the other directing the Dept. of Banking and Insurance to seek federal funding for a reinsurance program for the individual market.

The bills passed both houses of the legislature on April 12; the Governor has until June 7 to act. His hesitation, if there's more to it than due diligence, may stem from fiscal worries about the reinsurance program, as I've noted before.

Today the NJ Coalition for Health Care, an umbrella group of advocacy groups, trade groups, and unions led by New Jersey Citizen Action, sent a letter to Governor Murphy urging him to sign the bills. 17 organizations signed, including BlueWaveNJ, a group I volunteer for. The text is available here.

Tuesday, May 29, 2018

How Democratic candidates should talk about healthcare

The moderate/establishment candidate for the Democratic nomination in New Jersey's 7th Congressional District (a seat very much in play), Tom Malinowski, takes what in my view is an admirably substantive, focused, big-picture healthcare position:
On healthcare, Malinowski said he “does not support Medicare for all, but the idea of a Medicare option for all is worth exploring.” He said he’s spoken to many people who appreciate having healthcare options and he “would not force anyone to give up private health insurance which many Americans are happy with,” though he added that expanding a Medicare option could eventually lead to a single-payer type of system if people chose it voluntarily.
This more or less describes the Center for American Progress's Medicare Extra proposal and the Merkley-Murphy Choose Medicare Act. Those proposals in turn hark back to early versions of the public option, in which a Medicare-ish program was an 800-pound gorilla that private insurance was privileged to compete against if insurers or employers so chose. Some versions envisioned permanent competition between commercial/employer insurance and a public plan, while others expected a phase-out of private insurance (I discussed some of the variations here.)

Either way, my own view is that a public plan that employers and individuals can buy into provides a viable path either to a de facto all-payer system, in which commercial insurers pretty much have to pay similar rates to the public plan to survive, or to single payer.  And merits aside, I think Malinowski does a nice job in short space capturing both the conservative and the transformative appeal of a strong public option set alongside employer-based insurance. It's too bad that Democrats backed away from this model.

Sunday, May 27, 2018

Trump's CSR cutoff boosted ACA enrollment in the 300-400% FPL income bracket

This is to follow up, x-post, on a factoid I noted early this month: while enrollment in HealthCare.gov states was down 5% overall in 2018, and down 7.5% among those with incomes up to 200% of the Federal Poverty Level (FPL), it was up among wealthier subsidized enrollees. All of the absolute gain came in the 300-400% FPL range.

Enrollment at 200-400% FPL in HealthCare.gov States


Year
200-250% FPL
250-300% FPL
300-400% FPL
Total 200-400% FPL
2017
1,312,520
752,403
786,678
2,851,601
2018
1,277,488
747,165
867,198
2,891,851


That's actually quite striking. In the prior post, I noted
If enrollment in the 200-400% FPL range had been down 7.5% in 2018, as it was in the 100-200% FPL bracket, there would be 254,000 fewer enrollee in HealthCare.gov states than there are now. If the impact in the states that run their own marketplaces was proportionate, that suggests 342,000 fewer enrollees had the federal government continued to reimburse insurers for CSR.
Most of that gain attributable to silver loading occurred in the 300-400% FPL income bracket. If enrollment in this bracket were down 7.5%, there would be 140,000 fewer enrollees in HealthCare.gov states (and probably about 188,00 fewer nationwide).

The difference is almost certainly due to the silver loading of CSR costs (see note below), which created discounts in bronze and gold plans that chiefly benefit those with incomes above 200% FPL (below that level the free CSR benefit outweighs the gold/bronze discounts).  So let's look at metal level selection in the 300-400% FPL bracket in 2017 and 2018.

Note: CMS broke out gold selection in 2018 but not in 2017. So the 2017 "gold" line includes minimal enrollment in platinum and catastrophic plans, which together totaled 1.5 % of enrollment across all income levels.

Enrollment by metal level at 300-400% FPL in HealthCare.gov States

Year
Total bronze
% bronze
Total silver
% silver
Total gold*
% gold
Total
2017
316,400
40%
409,600
52%
 60,400
 8%
786,678
2018
466,000
54%
284,400
33%
116,200
13%
867,198

Gold totals for 2017 include platinum and catastrophic enrollment.

Enrollment totals at the metal levels are derived from whole-number percentages provided by CMS.

Bronze enrollment in this income bracket was up by about 150,000 in 2018, and gold was up by about 56,000.  Silver was down 125,000.

Takeup of subsidized marketplace plans has always been poor in the upper ranges of income eligibility. The bronze/gold discounts made available by Trump's cutoff of federal funding for CSR plainly improved takeup in the upper income range.

There is another factor in the enrollment spike at 300-400% FPL. A higher percentage of enrollees in this income bracket was probably subsidized in 2018 than in 2017. That's because of the huge spike in premiums in 2018. In previous years, younger enrollees in particular with incomes as low as 250% FPL did not qualify for subsidies, because unsubsidized premiums required of them an "affordable" share of income (almost 10% in the 300-400% bracket).

This year, the impact of slipping just below the subsidy line was magnified by the bronze/gold discounts. An older buyer in particular who might have had just a $10/month subsidy for a benchmark silver plan might find a much more dramatic discount in bronze or gold.

--
Note on Effects of CSR funding cut-off 

When Trump cut off federal reimbursement of insurers for the Cost Sharing Reduction subsidies they're legally required to provide to lower income ACA marketplace enrollees who select silver plans (57% of marketplace enrollees in 2017), most states allowed or required insurers to concentrate the cost of CSR in premiums for silver plans only. States in which 70% of individual market enrollees live concentrated the cost of CSR in on-exchange silver plans only, allowing for cheaper silver plans to be sold off exchange.

Since ACA premium subsidies are keyed to the price of the benchmark (second cheapest) silver plan in each rating area, subsidies rose to cover inflated silver premiums, generating often dramatic discounts in non-silver plans, i.e. gold and bronze (platinum availability and purchase is negligible). In many states, steep increases in silver plan premiums resulted in zero-premium bronze plans becoming available to many buyers (or nominal $1-3/month premiums), and gold plans that were either cheaper than silver or close in price.

Cheap gold plans were a particular boon to enrollees with incomes between 200% and 400% of the Federal Poverty Level (FPL). These buyers are not eligible for strong CSR, which makes silver plans roughly equivalent to platinum plans for buyers up to the 200% FPL threshold. Normally,  enrollees in the 200-400% FPL range would pay between 6% and 10% of their income (percentage rising with income) for a benchmark silver plan with an actuarial value of 70%, i.e. with an average deductible of around $3600). With CSR priced into silver plans in 2018, gold plans  (80% AV, with an average deductible of around $1100) came 

Friday, May 25, 2018

Trump's CSR cutoff is still reverberating

There is a kind of settled wisdom by now about the effects of Trump's cutoff of federal reimbursement of insurers for the Cost Sharing Reduction (CSR) subsidies they are obligated to provide to qualifying low-income enrollees in the ACA marketplace.

The story line: 1)states and insurers reacted swiftly and rationally by "silver loading" (explained below); 2) confining silver loading (explained in note at bottom) to on-exchange plans holds the unsubsidized harmless from the pricing in of CSR; 3) virtually all states and insurers will arrive at this solution; so silver-loaded CSR is now baked in, benefiting subsidized enrollees and not harming the unsubsidized. 4) Only further administration sabotage -- banning silver loading -- can disrupt this new normal.

The story line is essentially on target. About two million subsidized enrollees took advantage of bronze/gold discounts in 2018. The availability of those discounts probably helped offset other shocks to the system -- a halved enrollment period, radical cuts in outreach and enrollment assistance; insurer uncertainty as Republicans came within a whisker of repealing the core programs of the ACA.  Going forward, CBO estimates that silver loading will boost enrollment by 2-3 million per year (though I'm pretty sure the boost was in the low-to-mid hundred thousands in 2018, when silver premiums rose almost twice as much as gold and bronze). Further, some 70% of enrollees were in states where silver loading was concentrated on-exchange.

But that's not the whole story. Trump's threat to cut off CSR payments loomed for nine months before he pulled the trigger and was a major component of the general uncertainty insurers faced while filing rate proposals or deciding whether to participate in the marketplace. The effects of that uncertainty on premiums is, I suspect, not entirely captured by the calculated priced-in cost of CSR.  And now, here cometh the Congressional Budget Office to remind us that sudden policy changes have lingering effects, and the CSR shakeout isn't fully shaken out.

Wednesday, May 23, 2018

In New Jersey, ACA reinsurance or....?

Here in Jersey, progressives are urging Governor Murphy to sign two bills designed to fend off Republican sabotage of the ACA. The first would establish a state individual mandate to replace the effectively repealed federal mandate. The second would seek federal funding for a reinsurance program for the individual market for health insurance, designed to reduce premiums by 10-20%.

If the two bills are enacted and the ensuing waiver application seeking federal funding for reinsurance is approved, the two measures should reduce premiums by 20-30%, compared to where they'd be if no action is taken. For more detail, see this writeup.

Governor Murphy is likely to sign the mandate bill, but there are indications that he may seek changes to the reinsurance bill. The problem is cost.

Rough projections are that revenue from the mandate would cover a third to half of the reinsurance program's costs, while the federal government picks up half or a bit more than half. The state could be on the hook for an additional $30-40 million per year. New Jersey is in dire financial shape;  Murphy has a lot of spending priorities, and a looming fight on his hand to raise new revenue.

State Senator Joseph Vitale is confident that if the program proves to need more funding by FY 2021, when the first bill to insurers comes due, a revenue source can be developed -- probably via an assessment on insurers. Murphy might seek to get that in writing, in the bill -- as it was in an early version.  He would do so by issuing a conditional veto, after which the legislature would have to vote on an amended bill by June 7.

I found myself mulling this evening: If the bid to stand up a reinsurance program fails, how else might the mandate revenue, projected at about $90-100 million per year, be deployed to boost healthcare access in the state? One answer might be simply to return the mandate revenue to those hurt most directly by rising premiums: enrollees in the individual market who don't qualify for federal subsidies (subsidized enrollees pay a fixed percentage of income for a benchmark plan and so are not directly affected by premium hikes). These are mostly people above the income eligibility threshold, 400% of the Federal Poverty Level (FPL). They also include people who are ineligible for subsidies because of an offer of insurance from an employer.

Monday, May 21, 2018

Four ways states can leverage ACA sabotage

Sabotage of the ACA by the Trump administration and the Republican Congress will partially reverse the ACA's coverage gains, causing hardship to millions. But it differs from Republicans' failed legislative repeal in a fundamental way: The ACA's funding streams and mechanisms remain in place.

Not only can states that retain the will to make the ACA work continue to tap federal funding -- if they're willing to be creative, they can tap revenue streams created and inflated by the sabotage. Each form of sabotage has created new opportunities. There are at least four ways that states can not only fight off sabotage, but leverage funding opportunities that sabotage has created.

Tuesday, May 15, 2018

In Health Affairs: If CMS ends silver loading

I've co-authored with David Anderson, Charles Gaba and Louise Norris a blog post in Health Affairs that surveys the fallout from Trump's cutoff of federal funding for Cost Sharing Reduction subsidies in 2018 and considers the likely effects if the Trump administration moves to block the current effective strategies that most states have employed for dealing with that cutoff.

That is, what happens if CMS administrator Seema Verma and/or HHS Secretary Alex Azar move to block states from allowing or instructing insurers in the individual market to price CSR into silver plans only, a strategy that has created discounts in gold and bronze plans?

Part one recounts the history of how states and insurers found their way to silver loading. Part two quantifies how many people likely benefited from discounted bronze and gold plans. Part three reviews the impact of the CSR cutoff on unsubsidized premiums. And Part four considers the likely effects on plan pricing and enrollment if HHS/CMS either forces individual market insurers to spread the cost of CSR evenly among all ACA-compliant plans or to spread it evenly among all plans sold on-exchange only.

Hope you'll take a look.

Sunday, May 13, 2018

A "modernist' C.S. Lewis?

Continuing vacation-week repostings of the nonpolitical...

(8/17/14) Lev Grossman, a fantasy writer whose works I have not yet been privileged to read, has a wonderful, wonderful, wonderful tribute to C. S. Lewis, who brought him into the worlds of reading and of fantasy. He focuses first on a passage that I used to xerox for students, also trying to capture its magic:
Even more than that, it’s the way he uses language—which is nothing like the way fantasists used language before him. There’s no sense of nostalgia. There’s no medieval floridness. There’s no fairy tale condescension to the child reader. It’s very straight, and very clean—there’s no Vaseline on the lens. You see everything clearly, not with sparkles or a flowery sense of wonderment, but with very specific physical details. Look at the attention to detail as you watch Lucy going through the wardrobe:
This must be a simply enormous wardrobe!" thought Lucy, going still further in and pushing the soft folds of the coats aside to make room for her. Then she noticed that there was something crunching under her feet. "I wonder is that more mothballs?" she thought, stooping down to feel it with her hand. But instead of feeling the hard, smooth wood of the floor of the wardrobe, she felt something soft and powdery and extremely cold. "This is very queer," she said, and went on a step or two further.

Friday, May 11, 2018

Melt like wax into God or be born into her womb?

Continuing vacation posting of old non-political bits...

Kierkegaard, Julian, Obama

(5/5/13) -- Who knows what governs how a moderately engaged undergraduate makes sense of abstruse philosophic texts? As a sophomore, my mind settled on a basic dichotomy: Hegel bad, Kierkegaard good. This was probably what you might call a gendered thought. Hegel's basic How-Things-Work was to my mind aggressive, imperialist, male: thesis absorbs antithesis in new synthesis. Man slays dragon, eats its heart, becomes (relative) superman. Kierkegaard, by contrast, kept apparently irreconcilable opposites in eternal balance, on an eternal toggle switch whereby they could be seen alternately as part of a unity and eternally distinct.

I can't tell you at this distance whether my abstract caricature is accurate, but it has stayed with me all my life, and I tend to class thinkers on one side or the other of this divide. In retrospect, I'm sure that I placed the subject of my dissertation, the medieval mystic Julian of Norwich (an achoress, i.e. a nun in self-imposed solitary confinement) on the Kierkeaardian side of the ledger, though I never zoomed up the centuries to probe the association. *

Julian had a brilliant trick of subordinating the harsh elements of Catholic dogma that she didn't like (the damned are damned forever) to those that she felt by force of direct revelation to be true (all will be well, and all will be well, and all manner of things will be well).  Her basic dynamic was that God-as-man maintains two "cheres," or points of view: the human, limited one, whereby we must see and condemn our own sin, and the "inward, more ghostly" and more strictly divine one, whereby no one does anything except by God's will, and God is delighted with all, and sin is merely an instrument of human self-education.

Thursday, May 10, 2018

"New Jersey is poised to fight off ACA sabotage. Is Gov. Murphy on board?"

As Ive noted before, while the New Jersey legislature has passed bills establishing a state individual mandate and a reinsurance program, Gov. Murphy has not committed to signing them. I have an op-ed up on NJ Spotlight arguing that the need is urgent.:
The Congressional Budget Office forecast that mandate repeal in itself would generate premium increases of 10 percent per year throughout the next decade. An analysis of the impact on states commissioned by Covered California the state's ACA marketplace, put New Jersey in the highest risk category, where premiums are forecast to rise as much as 90 percent over three years if action is not taken to strengthen the markets. Early insurer rate requests filed in Virginia and Maryland are showing sky-high increases. Maryland's insurance commissioner is warning of a death spiral and placing hope on the state's reinsurance waiver proposal.
If there's any sticking point, it's probably related to cost. Here is an outtake with someone more detail than I had space for:

Outside our diseased political realm...

Good morning! I'm going to be on vacation for a week-plus, and probably not blogging healthcare. In the interlude, I thought I'd re-post a few non-political entries. The first, below, is from January 2010. I also have a couple of healthcare articles placed elsewhere (one a co-byline) that should drop during my time away. I'll post links when that happens.

A Cliff note for deconstruction

(1/8/10) -- Deconstruction, the literary theory that "attempts to demonstrate that any text is not a discrete whole but contains several irreconcilable and contradictory meanings" (Wikipedia - a definition as good as any) has been popularly regarded as an arcane, perverse bit of wizardry on the border between fraud and rocket science. I always felt that it demonstrated itself pretty well empirically (though logically, it should also unravel its own propositions...).

One Shakespeare sonnet, No. 24, always seemed to me to capture the idea in a line - the one bolded below.

Mine eye hath played the painter and hath stelled
Thy beauty's form in table of my heart.
My body is the frame wherein 'tis held,
and perspective it is best painter's art.
For through the painter must you see his skill
To find where your true image pictured lies,
Which in my bosom's shop is hanging still,
That hath his windows glazed with thine eyes.

Monday, May 07, 2018

Virtually no enrollment loss in state-based ACA exchanges in 2018

I imagine it's been noted before, but states that run their own ACA exchanges collectively had virtually no enrollment losses in 2018, while enrollment in the 39 HealthCare.gov states shrank 5%.

The loss even among unsubsidized exchange enrollees in the state-based exchanges (SBEs) was very slight, just 1% -- compared to 10% in the HealthCare.gov states. After Trump cut off federal funding for Cost Sharing Reduction (CSR) subsidies, most of the SBEs silver-loaded CSR costs on-exchange, and allowed insurers to offer silver plans off-exchange with no CSR priced in (for an explanation, see note below). That includes California, which accounts for almost half of SBE enrollment. It might therefore have been expected that more unsubsidized enrollees in the SBEs would have moved off exchange. And where unsubsidized on-exchange enrollment did drop, it will be hard to determine if many may have enrolled in ACA-compliant plans off-exchange.

Saturday, May 05, 2018

Will Trump's cutoff of CSR reimbursement boost ACA enrollment by 2-3 million, per CBO?

Trump's cutoff of federal funding for Cost Sharing Reduction subsidies (CSR) last October created discounts in bronze and gold plans for many subsidized enrollees in the ACA marketplace, as explained below.  The availability of these discounts partly offset other forms of sabotage, so that on-exchange enrollment was down a relatively modest 5%.

On May 3, CBO Director Keith Hall estimated in a blog post that the CSR cutoff has boosted or will boost marketplace enrollment by an astonishing 2-3 million. The verb tense and time frame is ambiguous, per below (my emphasis). The estimate surely does not apply to 2018 -- I doubt the enrollment boost this year exceeded 500,000, for reasons explained below.

Here's Hall's explanation of how the CSR discounts came about and their likely effects:
On the basis of an analysis of insurers’ rate filings, CBO and JCT estimate that gross premiums for silver plans offered through the marketplaces are, on average, about 10 percent higher in 2018 than they would have been if CSRs were funded through a direct payment. The agencies project that the amount will grow to roughly 20 percent by 2021.

Tuesday, May 01, 2018

Silver loading yields some gold dividends in Kansas

Quick: what changed in the Kansas ACA marketplace in 2018, besides a shortened enrollment period?

Metal Level Selection in Kansas, 2018 vs. 2017

2018


Bronze
Silver
Gold
Catastrophic
Total
% of total enrollment
28%
50%
21%
1%
100%
Number enrolled
27,867
48,679
20,765
927
98,238

2017


Bronze
Silver
Gold
Catastrophic
Total
% of total enrollment
26%
65%
8%
1%
100%
Number enrolled
25,412
64,735
7,816
817
98,780


Yup. For two thirds of enrollees, the cheapest gold plan was cheaper than the cheapest silver -- the exceptions being those in Johnson and Wyandotte counties (adjacent to each other), together home to two thirds of the state's marketplace enrollees.* Hence gold enrollment nearly tripled statewide, whereas gold takeup was half the statewide total in Johnson County (10.5%) and one third in Wyandotte (6.5%).*

Monday, April 30, 2018

George Orwell's mirror for American leaders

I have been essays that George Orwell wrote in the thirties and during World War II. They hold up a distant mirror* to our current predicament.

Orwell, a "democratic socialist" with an evolving dislike and distrust of hard-line Communists, is not always insightful. His major error was assuming that Britain -- and ultimately, I gather, all countries -- had to make a binary choice between fascism and socialism. He roughs out some national stats, such as how many British citizens were likely to be malnourished circa 1937, but he doesn't seem to have much of a grasp of economics. He's vague about the changes he'd like to see, at least in the essays I've read (and in The Road to Wigan Pier, really an extended essay).

But Orwell did know people -- he was a passionate embedder, becoming a tramp to get to know tramps, staying in the miserably substandard homes of coal miners, talking in depth to hundreds of working and middle class people. And he has a certain moral clarity, a commitment to justice and alleviating suffering. He judges the privileged, but with empathy. He sees that his Marxist quasi allies are driven largely by hatred and he recoils from that.

Thus, while condemning  Britain's leadership through the post-WWI era for myopia, for clinging to their privilege, for cowardice and incompetence, Orwell pays grudging tribute to a certain baseline integrity. And that's where we get, to mangle a metaphor, a kind of mirror-by-contrast held up to the U.S. just now:

Thursday, April 26, 2018

Rational choice in the ACA marketplace, Pennsylvania 2018 edition

Pre-script: Looking again at the first chart below, I fear this was one of my bury-the-lead days. In the three income brackets ranging from 200-400% FPL -- subsidized enrollees not eligible for strong CSR -- 42% bought gold plans. Forty-two percent! That is back-door CSR, statewide -- a significant boost in value available to those at the upper end of subsidy eligibility.
--------
While unsubsidized buyers of health insurance in Pennsylvania's individual market suffered from rate hikes north of 30%, subsidized enrollees got all kinds of  bounty as a result of the state's decision to "silver load" the cost of Cost Sharing Reduction (CSR) subsidies. That is, once Trump cut off federal reimbursement to insurers for CSR, Pennsylvania insurers priced it in to silver plans only, generating discounts in other metal levels  (see note at bottom for an explanation).

In the state's most populous counties, the individual insurance market is dominated either by Independence Blue Cross (Philadelphia and surrounding counties), Geisinger (e.g., counties just to the west of the Philly region) or UPMC (e.g., Allegheny, including Pittsburgh). Thanks to silver loading, Geisinger and UPMC offered gold plans that were cheaper than the cheapest silver available. Independence Blue Cross offered a gold plan that was priced a more or less normal range above the cheapest silver. But as explained in my previous post, thanks to a huge gap between the cheapest silver plan and the benchmark silver plan, that gold plan was free or very low cost to many subsidized buyers.

In fact in all counties except those clustered near Philadelphia and served by Independence BC, the cheapest gold plan was cheaper than the cheapest silver. And in Philly and the surrounding counties, the cheapest gold plan was cheaper than the benchmark silver plan, and so heavily discounted, as subsidies are set against the benchmark. (David Anderson has mapped cheapest gold vs. cheapest silver prices in all counties nationally here; you can select a Pennsylvania-only view.)

As a result, gold plan enrollment more than tripled in Pennsylvania in 2018. Enrollment in bronze plans, which were free to everyone over 30 with an income of $30,000 in large swaths of the state, more than doubled.

Tuesday, April 24, 2018

A free silver plan with a $0 deductible...What's not to like?

I have been fond of noting that notwithstanding the complexity of health insurance, most enrollees in the ACA marketplace seem to get the most consequential choice right: metal level. In particular, most people eligible for strong Cost Sharing Reduction (CSR), which is available only with silver plans, chose silver and access it.

This year, subsidized enrollees' responses to the anomalous discounts generated by Trump's cutoff of federal funding for CSR (see note at bottom if you're unfamiliar with this) reinforce this narrative. In some states where the cheapest gold plans are cheaper than the cheapest silver, gold enrollment quadrupled or tripled. In the 200-250% FPL income band, where CSR is negligible, silver enrollment fell off a cliff in states where "silver loading" the cost of CSR generated large bronze/gold discounts (on HealthCare.gov, silver selection in this income band dropped from 68% in 2017 to 53% in 2018).

But when it comes to plan complexity, there are layers within layers -- literally, in the form of tiers. While I was working on a post about rational choice in Pennsylvania, where CSR takeup remained fairly strong even as gold enrollment more than tripled to 27% of total enrollment, I came across a mystery.

Wednesday, April 18, 2018

Two NJ healthcare bills awaiting Gov. Murphy's signature should reduce premiums by 20-30% in the individual market

On April 12, both houses of the New Jersey legislature passed bills to establish a state individual mandate (A3380) and a reinsurance program (S1878). The bills are designed to work in tandem to stabilize and reduce premiums in the individual market for health insurance.

It is not certain that Governor Phil Murphy will sign the bills. A mandate is a tax, and taxes are hard. The reinsurance program will cost the state some money, though not much -- probably an amount in the low tens of millions each year. But the payoff would be dramatic. Taken together, as outlined below, the bills can be expected reduce premiums in the individual market 20-30% compared to what they would be if neither bill is enacted.

Thursday, April 12, 2018

If Seema Verma bans silver loading, how many ACA marketplace enrollees will suffer?

A few weeks ago, using ACA marketplace enrollment data available for Maryland, I calculated that about 20% of Maryland marketplace enrollees would lose valuable discounts in gold and bronze plans if federal reimbursement to insurers for Cost Sharing Reduction (CSR) subsidies were restored by Congress, after being cut off by Trump last fall.

Early this month, CMS published enrollment data for all states, with more detail (as always) for the 39 states using the federal exchange, HealthCare.gov, which account for just under three quarters of all enrollment. And while Congress balked at restoring CSR funding for 2019, CMS administrator Seema Verma is now intimating that CMS may ban "silver loading," the pricing practice that produced this year's discounts in bronze and gold plans. With the full enrollment data for HealthCare.gov, we can now calculate roughly how many people would lose access to the kind of de facto subsidy enhancements that emerged this year.

Tuesday, April 10, 2018

Does marketplace resilience show creator brilliance? Not quite, Krugman

Paul Krugman crows a bit about the ACA's relative resilience:
What’s the secret of Obamacare’s stability? The answer, although nobody will believe it, is that the people who designed the program were extremely smart. Political reality forced them to build a Rube Goldberg device, a complex scheme to achieve basically simple goals; every progressive health expert I know would have been happy to extend Medicare to everyone, but that just wasn’t going to happen. But they did manage to create a system that’s pretty robust to shocks, including the shock of a White House that wants to destroy it.
Um, maybe, sort of. The perspective is a useful corrective to those of us prone to lamenting the ACA's many design flaws and susceptibility to sabotage. And Krugman does highlight a resilience-making feature that I suppose could have been otherwise:
Those subsidies aren’t fixed. Instead, the formula sets the subsidy high enough to put a limit on how high premium payments can go as a percentage of income.
Yes, the subsidy-eligible are insulated from the massive premium hikes of the past two years -- averaging well over 20% in each year -- and that would not be the case if they were not benchmarked to income. The Trump administration even added some accidental extra resilience in an act of spite -- cutting off federal CSR reimbursements to insurers -- which simply boosted the subsidies, and allowed many enrollees to leverage the increase by buying bronze or gold plan (since in most states insurers concentrated the un-reimbursed price of CSR in silver plans, against which subsidies are set).  So the subsidy structure seems to preserve a pool of 8 million subsidized -- if erosion among the unsubsidized, and the Trump administration's fostering of a lightly regulated, medically underwritten alternative market for the healthy among them -- doesn't drive large numbers of insurers out.

But Krugman overstates the case on several fronts -- the most notorious being a straight factual fudge. Noting that 83% of enrollees on the exchanges are subsidized, he concludes:

Sunday, April 08, 2018

Getting rid of Trump on the cheap

Shortly after Trump won the presidency, David Frum warned that the gravest danger to American democracy was the likelihood that Republicans in Congress would refuse to hold him accountable and would go along with his multi-front assaults on core American institutions and norms. Ever since then, I've thought that a stupid Trump move that triggers a recession or economic crisis might be the one thing that would induce Republicans to drop him -- "like a hot rock," as McConnell once falsely promised to do prior to Trump's nomination. If so, a recession would be the cheapest way we'd likely find to shake off the various mortal and merely grave dangers Trump poses. Trump's tariffs have markets gyrating and shaking; they could trigger this scenario

Wishes can be calibrated only in superstitious prayer. So much could go wrong with this scenario. Trade war could trigger hot war. Trade war could start, and Trump could set off an unrelated hot war. Trade war could lead to global depression. Republicans could stick with Trump no matter what he does. Various crises could trigger other extreme reactions in Trump -- moves to shut down media or criminalize/jail adversaries of various types. And of course, trade war may not happen -- China may give Trump a fig leaf while cleaning his clock in negotiations.

Nonetheless, a tightrope walk of fortune -- a Trump-triggered financial crisis (hopefully of the short and mild variety), followed by a Republican loss of one or both houses of Congress, followed by Republican acquiescence in various Congressional moves to rein Trump in, up to and including impeachment -- remains possible. Mount to heaven, O superstitious prayer!

Friday, April 06, 2018

New Jersey can sabotage-proof its ACA marketplace next week

Update, 4/12/18: All three bills discussed below passed in both houses of the New Jersey legislature today (info below via the legislature's bill lookup feature). On to Governor Murphy!

1. Individual mandate bill
A3380 Aca (1R) "New Jersey Health Insurance Market Preservation Act." 
Passed both Houses  

2. Reinsurance bill
S1878 ScaScaScs (SCS) "New Jersey Health Insurance Premium Security Act;" establishes health insurance reinsurance plan. 
Passed both Houses  

3. Out-of-network bill
A2039 Aca (1R) "Out-of-network Consumer Protection, Transparency, Cost Containment and Accountability Act." Passed both Houses 

Original post, 4/6:
----
Amid all the worry about the effects on the ACA marketplace of individual mandate repeal and administrative rules fostering an ACA-noncompliant market, some really good news is pending in New Jersey.

Bills to establish a state individual mandate (S1877/A3380) and to start the process of seeking a waiver to obtain federal funding for a reinsurance program have passed through committee and are scheduled for floor votes on Thursday, April 12.  The mandate bill would dedicate the revenue collected to the reinsurance program.

While both bills are expected to pass, it's not a sure thing. All Republicans are opposed to the mandate. Governor Murphy has been quiet about it. Mandates are a heavy lift even in blue states. But New Jersey is close, and that's very good news.

Tuesday, April 03, 2018

"Strong" CSR takeup dropped only slightly on HealthCare.gov in 2018

Update/correction: This year, for the first time, CMS broke out enrollment at each level of CSR (at actuarial values of 73%, 87%, and 94%) -- and separately, metal level enrollment at each income level (indirectly - see note below). As explained below, the percentage of apparently subsidy-eligible enrollees with incomes up to 200% FPL who obtained strong CSR (94% or 87% AV) is somewhat lower than the percentage who selected silver plans. 

I noted recently with respect to Maryland ACA marketplace enrollment, the downside of "silver loading" the cost of CSR is a drop in takeup of the strong CSR available to enrollees with incomes below 200% FPL. CSR is available only with silver plans (please see the prior post to un-abbreviate all this).

That downside (for the subsidized) is outweighed by the upside. In Maryland, about 30,000 enrollees with incomes over 200% FPL obtained steep discounts in bronze and gold plans, whereas about 6,000 fewer enrollees under 200% FPL obtained strong CSR than would have had Trump not disrupted the market by cutting off federal funding for the benefit (see appendices to post linked to above for a quick explanation).

Now we have enrollment numbers for the all states -- with, as usual, more precise breakouts for the the 39 states using the federal exchange, HealthCare.gov than for the whole country.  In HealthCare.gov states, CSR takeup among those with incomes up to 200% FPL downticked only slightly.  -- to  about 82%. Silver selection among those with incomes ranging from 100-200% FPL dropped from 86.9% in 2017 to 85.3% in 2018. For 2017, we don't know how many silver enrollees in the income bracket did not obtain CSR.

Could Trump's ACA sabotage pave the way to a strong public option?

The Urban Institute's Linda Blumberg and John Holahan, authors of an "ACA 2.0" blueprint, mull healthcare reform after Trump

In August 2015, Urban Institute scholars Linda Blumberg and John Holahan warned that the ACA marketplace as then constituted would probably never perform to expectations. Subsidies were insufficient to draw the robust participation the law's creators had anticipated. They proposed a revamped subsidy schedule that reduced premiums and out-of-pocket costs at every income level. For those with incomes above the current subsidy threshold of 400% of the Federal Poverty Level, premiums for a benchmark plan covering 80% of the average enrollee's costs would be capped at 8.5%.

Hillary Clinton more or less incorporated the Blumberg-Holahan proposal into her healthcare platform. And now, two years later, bills to improve the ACA introduced by Democrats in the House and Senate do likewise. Both bills precisely reproduce the plan's enhanced premium subsidies and offer even more generous reductions in enrollees' cost sharing (see the Appendix below for a summary).

The Senate bill, introduced by Elizabeth Warren and four colleagues,* places several new constraints on insurers in the individual market. These include requiring insurers to provide a better selection of doctors and hospitals, raising the percentage of premium revenue insurers are required to spend on enrollees' medical costs, and standardizing plan design. The preamble to a one-page summary of the bill appears to blame insurers alone for Americans' high healthcare costs.  By generously subsidizing enrollees at all income levels, however, the bill creates conditions under which insurers in the individual market can thrive.

ACA 2.0 -- or a whole new system?

I spoke to Blumberg and Holahan last week to get their reaction to the "ACA 2.0" bills, the Warren bill in particular. Blumberg confirmed that they had been consulted by the bill's creators, though they did not participate in the drafting.

Saturday, March 31, 2018

Open thread: How Trump's cutoff of CSR funding affected Maryland enrollment

My last post looked at the drop-off in silver plan selection among Marylanders eligible for strong Cost Sharing Reduction subsidies in 2018. CSR is available only with silver plans. When Trump cut off federal funding for CSR, insurers in Maryland priced it into on-exchange silver plans only,which generated large discounts in bronze and gold plans for subsidized buyers . For an explanation of how that worked, see the first note at bottom. For a summary of the discounts to the subsidized on offer in Maryland in 2018, see the second note.

Today, let's kick back and squint at the changes in metal level choices in Maryland at each income level (including the upper brackets this time) from 2017 to 2018. I'll offer a couple of observations below the charts now, and maybe more through the weekend. I invite you to offer your own.

Here are the percentages who chose each of the three main metal levels in each income band in both years. In both years, a bit under half of all enrollees had incomes under 200% of the Federal Poverty Level, and so were eligible for strong CSR (about 98% of them, anyway).  At bottom, the raw numbers at each metal level are charted, courtesy of the Maryland Health Connection. (Platinum and catastrophic plans accounted for 3% of enrollment between them in both years.)

2017

Income (% FPL)
% bronze
% silver (CSR)
% gold
< 100 
 3
96
  0.7
100-138
 4
95
  0.5
138-150
 7
92
  0.5
150-200
10
88
  1.0
0-200 (strong CSR)
 7
92
  0.8
200-250 (weak CSR)
21
74
  3.2
250-300
30
60
  6.0
300-400
31
57
  7.4
>; 400
33
48
11.6
Unknown
26
54
11.0
Total
18
74
 0.5

2018


Income (% FPL)
% bronze
% silver (CSR)
% gold
< 100
<100 p="">
10
80
  7
100-138
  8
84
  7
138-150
  9
83
  8
150-200
13
76
10
0-200 (strong CSR)
11
79
  9
200-250 (weak CSR)
24
46
28
250-300
32
32
33
300-400
37
25
34
> 400
42
24
27
Unknown
35
34
22
Total
23
55
19

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