Hey Senator Warren, Medicare Extra fills your prescription

Last month, at the Health Access 2018 conference, Elizabeth Warren decried rising out-of-pocket costs required in employer-sponsored health plans and demanded that a new round of healthcare reform "require private insurers to be just as affordable as public insurers like Medicare and Medicaid.”  (I discussed the speech at some length here.)

That formulation struck me as problematic in several ways: 1) Medicaid and Medicare offer very different levels of affordability (except where they're merged for dual eligibles); 2) employer-sponsored insurance, on average, is "just as affordable" as Medicare and in fact provides better protection against crushing out-of-pocket costs than traditional Medicare; and 3) Warren bashed insurers alone for price-gouging without mentioning provider payment rates, which would have to be squashed down if commercial insurance were subject to stricter affordability mandates.

Perhaps, though, Warren had some inkling of the Medicare-for-all-who-need-or-want-it plan that was brewing at the Center for American Progress, released yesterday.

Medicare Extra creates an all-payer system -- via a bank shot for employers

Like many "Medicare for All" or "Medicare for Most" plans that preceded it, the Center for American Progress's Medicare Extra plan, released on Feb. 22, preserves employer-sponsored insurance. Employers can opt to continue to offer their own plans, with a minimum actuarial value of 80% (near the current employer average). They can sponsor their employees' entry into Medicare Extra. Or they can leave their employees to enter the system on their own and reimburse the government.

The plan spells out two reasons for maintaining employer-sponsored insurance: keep employer dollars in the system, and minimize disruption (if you and your employer like your plan, you can keep it):

U.S. employers currently provide coverage to 152 million Americans and contribute $485 billion toward premiums each year. Surveys indicate that the majority of employees are satisfied with their employer coverage. Medicare Extra would account for this satisfaction and preserve employer financing so that the federal government does not unnecessarily absorb this enormous cost.

Timothy Jost and Harold Pollack weigh in on Medicare Extra

Yesterday, the Center for American Progress released a sweeping but incremental proposal to vastly expand Medicare and transition the U.S. to a more or less "all-payer" system, in which whatever private insurance remains (in employer plans, and Medicare Advantage-like plans) pays more or less the same rates and offers more or less the same benefits as a revamped Medicare, dubbed Medicare Extra. Medicaid and CHIP would also be folded in. Everyone would be covered.

It's a well designed proposal that's hard for a progressive not to like on the merits. But could Democrats ever pass anything like this? I asked Timothy Jost and Harold Pollack and got surprisingly different answers (I'll say that Pollack surprised me more than Jost). The article, with extensive input from both, is up at healthinsurance.org

POSTSCRIPT, 2/24: One thing is nagging me a bit as reaction to the article unfolds. Harold Pollack suggests that  "Democrats will be much more ruthless the next time around" -- they're done trying to placate not only Republicans but, to a certain extent, healthcare industry interests; they're virtually forced to go for broke if they get the chance. That strikes a deep chord with progressives; it breaks something loose in a progressive heart. Timothy Jost, on the other hand, throws cold water, ticking off the forces that will be aligned against a strong drive toward universal coverage and cost control. What fun is that? But Jost and Pollack's reactions are not as far apart as they appear. Jost does point out that if Democrats gain power any time soon they'll be under strong pressure from the activists a party depends on to go big. And Pollack, in comments that did not make it into the text (my bad?), said that he thinks there's a good chance Trump will be re-elected -- and also acknowledged that industry would hack some parts off before anything like this would ever get enacted.

Pollack's take on the politics the Medicare Extra plan surprised me. I thought he'd be as dubious about the prospects for success as Jost. The fact that he wasn't gives this article its charge, I think (along with the workable architecture of the Medicare Extra plan itself). But I'm also pretty sure that Pollack would be the first to acknowledge that Jost may well be right -- that our political system will prove incapable of putting through such sweeping and coherent reform.

The ACA marketplace is damaged and taking new hits...but it's not a high risk pool and probably won't be

Update, 3/8/18: Various analyses are now predicting steeper premium hikes and coverage losses than I anticipated here, resulting from the combined effects of mandate repeal and greenlighting of short-term and AHP plans. See Urban Institute, 2/26, and Covered California, 3/8.
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Since it first hit email boxes a few months (or maybe a year-plus?) ago, Vitals, Axios' healthcare e-newsletter, has beguiled its way into a first read. Editor Sam Baker, and Axios generally, have taken the holy grail (or shibboleth) of contemporary prose, concision, to a new level, sating our short attention spans while salting news aggregation with interpretation.  I find the trademark "be smart" tagline a touch patronizing, but the substance of that signposted takeaway is nearly always on point.

That said, I'm going to quibble with today's lead storylette, with a point behind the quibble that goes beyond Axios, I think.

The news item is HHS's proposed rule to allow loosely regulated short-term health plans to be sold for terms as long as a year rather than three months, the limit that went into effect last April. Since short-term plans are cheap, medically underwritten and not bound to cover Essential Health Benefits, they are poised to attract healthier buyers. With this rule, Trump's HHS punches one more hole in the ACA risk pool

Here's my quibble. According to Sam Baker, The ACA-compliant individual market is "sliding deeper into something a lot more like a makeshift high-risk pool, in which healthy people are absent and the government simply pays to cover sick people." I think that's overstated.

The catastrophic option in a degrading market for health insurance

Okay, so short-term health plans are back to not really being short-term -- or likely will be so, as of July. HHS has rolled back the Obama administration rule that limited such plans to three-month terms, a rule that only went into effect last April.  Once again, these plans -- which do not comply with ACA coverage rules and can be medically underwritten and exclude coverage for pre-existing conditions -- can be offered for up to a year.

So big deal, you might say. Short-term plans with year-long terms were available from 2014-2016 (and in the first quarter of 2017) and did not have a huge impact on ACA marketplace enrollment. Yes, but this time it's different, for two reasons. First, the individual mandate is effectively repealed as of 2019, so people need not obtain ACA-compliant coverage. Second, premiums in the ACA-compliant market have skyrocketed in the last two years (thanks largely to Republican sabotage), so more people are priced out. Louise Norris's analysis strongly implies that HHS is lowballing projected enrollment with its estimate of 100-200,000.  See Louise's post for a thorough overview of how short-term plans work and who's likely to buy them.

Short-term plans can be very cheap, and coverage can be very limited (especially if you have a serious pre-existing condition, which will be excluded). ACA-compliant plans, on the other hand, can be astronomically expensive if you're not subsidy-eligible, particularly if you're in your late fifties or early sixties.

As the individual market for health insurance fractures, I want to take a look at one tweener market that may help a few people navigate between the Scylla of unaffordable coverage (say, $1,000 per month for a solo plan with a $7000 deductible) and the Charybdis of unregulated coverage that may exclude, say, drug coverage or pregnancy, cap total coverage, and be medically underwritten.

On HealthCare.gov, CSR takeup rose steadily from 2015 through 2017

One aspect of ACA marketplace enrollment that's intrigued me ever since HHS started producing enrollment statistics is "CSR takeup" -- the percentage of enrollees who are eligible for Cost Sharing Reduction (CSR) subsidies who access the benefit by selecting silver plans, the only level at which CSR is available.

Silver can be expensive for low income enrollees -- a benchmark silver plan costs an enrollee with an income at 200% of the Federal Poverty Level about $125 per month. At the same time, up to 200% FPL, CSR dramatically reduces out-of-pocket costs. (The benefit is much weaker for those in the 200-250% FPL range, and silver plan selection tapers off accordingly among enrollees over 200% FPL.)

One fact that's escaped me until now: CSR takeup rose steadily from 2015 through 2017, at least in the states using the federal exchange, HealthCare.gov (as 37 states did in 2015 and 39 in 2017). That's been somewhat obscured by the fact that the percentage of all enrollees with CSR has not risen. But enrollees' income mix on the federal platform has shifted upward as states on the platform enacted late Medicaid expansion, and as two states that expanded Medicaid early, Hawaii and Kentucky, came on board the federal platform. In 2015, 78% of enrollees were known to have incomes under 251% FPL. In 2017, 74% were below that threshold.

Health Policy Valentines 2018

Wait, no, this can't be my fifth year of #HealthPolicyValentines.* But yes: here is Love Knows No Repeal (2017),  Love in the Time of Obamacare (2016), love, 2015, and first love, 2014.

And who'd have thought we'd have at least two Trump-era V-days with the ACA unrepealed? But here we are...

Spite is served hot,
Revenge is served cold.
Trump cut off CSR,
We got cheap bronze and gold.

     *      *      *

Replace came up empty,
Repeal served up zeroes.
We love you, Little Lobbyists,
True national heroes.

     *      *      *

Heller was craven,
Capito, afraid.
Collins, McCain, Murkowski
saved our Medicaid.

*      *      *

Think ACA enrollment is complicated? Try Medicare

One of the early and persistent raps against the ACA is that the benefit structure and application process are too complex. There's a lot of questions to answer. It takes a half hour to an hour -- if you're not called on to provide extra verification for your identity or immigration status or income. There are benefit cliffs -- between Medicaid and the marketplace; between marketplace enrollees who qualify for strong Cost Sharing Reduction and those who don't; and, most precipitous (for older enrollees), between those who qualify for premium subsidies and those who don't. As for plan offerings, in some markets a dominant insurer will throw up a half-dozen minutely differentiated plans, sowing confusion.

All this is true. But I'd like to take a first pass here at a myth that I'd like to explore more fully later: that by comparison, Medicare is a blessed zone of simplicity, equity and benefit adequacy.

We won, now what? My account of Health Action 2018 at Crooked Media

The Affordable Care Act's passage through 2017 was a bit like Odysseus' ship sailing past the six-headed monster Scylla: six men gone, but the ship sails on (only to be destroyed by thunderbolt a few episodes later, but never mind that part). 

Health Action 2018, Families USA's annual confab of healthcare activists, was largely devoted to taking the measure of the political power somewhat miraculously tapped by a wave grassroots passion and action that staved off repeal -- and groping toward a path by which Democrats can build on or move beyond the ACA in years ahead.

I have an article up at Crooked Media that examines what kinds of next steps - or false starts -- the conference conversations point toward:

What I learned at Health Action 2018

Below, a few notes from Health Action 2018, Families USA's annual conference -- things I learned, or learned in more detail, or was forcefully reminded of. [Update: my report about what the conference suggested about where Democrats may be headed on the healthcare front is up at Crooked Media.]

         Re Medicare:

• Many low income sixtysomethings face a "Medicare cliff" at age 65. They've had all their medical expenses paid by Medicaid;  now, suddenly, they're faced with Medicare's 20% copays, drug costs, etc. (Leslie Fried, National Council on Aging)


• Medicare Savings Programs (MSPs), a variety of programs through which low-income Medicare enrollees' premiums or out-of--pocket costs are picked up by Medicaid, are all underutilized. Only about half of those eligible are enrolled. Funding for State Health Insurance Assistance Programs (SHIP), which provide enrollment assistance to seniors, is grossly inadequate and at risk. Susan Collins has stood up for SHIP. (Leslie Fried).  I plan to learn more/post more about the Medicaid-->Medicare cliff.