Monday, October 08, 2018

Four healthcare questions for Bob Hugin

Bob Hugin, the former Celgene CEO seeking to take Democrat Bob Menendez's New Jersey Senate seat, talks a moderate game on healthcare. He promises to protect access to insurance for people with pre-existing conditions, doesn't trash-talk the Affordable Care Act, and talks up value-based payment and focusing more on prevention than treatment -- pious goals to which politicians in both parties pay tribute.

Hugin is, however, a Republican - a prominent supporter of President Trump, big donor to Paul Ryan's SuperPACs, and aspiring member of Senate Team McConnell. Many of his rather vague pronouncements about existing programs demand greater scrutiny.

Hugin focused on healthcare in a September 26 roundtable in Glen Ridge, covered by Advance Media here. Here are some followup questions reporters -- and voters - -should ask Hugin when he delivers moderate-sounding pronouncements about existing programs. Quotations are from the AM story or the short video embedded in it.

1. "I cannot envision any changes to our health system today that would not protect people with pre-existing conditions." 

Question:  Senate Republicans have introduced a bill purporting to maintain those protections -- because a Republican lawsuit threatens to get them struck down. The Senate bill, introduced by Nevada's Dean Heller, allows insurers to exclude an applicant's pre-existing condition from coverage. Then there's Greg Walden's 2017 House bill, the so-called Pre-existing Conditions Protection Act, which has been rapidly taking on sponsors, and which allows insurers to charge more -- with no limit -- to people with pre-existing conditions. Do you support these bills? Do they provide adequate protection?

Background: Republicans generally are promising to protect access to insurance for people with pre-existing conditions,  but 1) the 2017 Republican House and Senate bills to repeal the ACA's core functions both opened the door to medical underwriting; 2) a lawsuit filed by 20 Republican attorneys general and governors seeks to have the entire ACA declared unconstitutional, and the Trump administration argues that this suit should result in the ACA's protections for preexisting conditions being struck down; and 3) Republican bills purporting to protect people with pre-existing conditions are loophole-ridden. Deeds do not match words here.

2. "Hugin said he'd advocate for increased decentralization of Medicaid. 'All states are different,' Hugin said. 'Washington, D.C., does not have the answer for how an individual state or community should best care for the most vulnerable people in their society.'"

Question: When Republicans talk about state flexibility in Medicaid, they are generally advocating for 1) converting federal Medicaid funding to block grants or imposing "per capita" caps on it, and 2) allowing states to impose work requirements on so-called "able-bodied adults. Do you support these measures?


Block grants or per capita caps: At present, federal Medicaid funding is determined by a "match rate" -- the federal government's share of each state's Medicaid spending -- that varies by state and program but is no less than 50%. The federal government is committed to paying its match rate for all qualifying enrollees. Block grants would determine a fixed amount, based on current costs, to be paid each state, with the amount expanding according to a fixed formula likely to lag behind actual cost growth. Per capita caps would fix the federal contribution per person, also according to a formula that would lag cost growth.

Block grants have a history of eviscerating the programs to which they're applied. As the Center for Budget and Policy Priorities (CBPP) reported in February 2017, as Republicans geared up for an effort to block-grant Medicaid, "Since 2000, overall funding for the 13 major housing, health, and social services block grant programs in the federal budget has fallen by 27 percent after adjusting for inflation, and by 37 percent after adjusting for inflation and population growth." Block granting gutted cash assistance to poor families in particular: "TANF [Temporary Assistance for Needy Families] today provides substantially less protection against poverty than AFDC [predecessor Aid to Families with Dependent Children]did.  In 1996, for every 100 poor families with children, 68 families received AFDC cash assistance.  By 2015, only 23 families with children received TANF cash assistance benefits for every 100 poor families."

In 2017, Republican bills to repeal core functions of the ACA passed the House and nearly passed the Senate. These bills imposed per capita caps on Medicaid that would hold the increase in federal spending below likely spending growth -- notwithstanding that Medicaid coverage likely costs at least 25% less than would private coverage for the same population. The Congressional Budget Office estimated that the House bill would cut $834 billion in federal Medicaid spending over 10 years - partly by rolling back funding for the ACA Medicaid expansion and partly by imposing per capita caps. CBO then estimated that the Senate repeal bill would cut Medicaid spending by 35% over 20 years. The Center for a Responsible Federal Budget fleshed out the estimate, estimating that spending would be $1.7 trillion dollars lower from 2027-2036 than under current law.

Medicaid and CHIP cover 73 million Americans, over 20% of the population, including 38% of the nation's children and  62% of people in nursing homes. Does Bob Hugin support the radical cuts his party has repeatedly proposed? Does he support ending the federal government's commitment to pay its established share of the actual cost for each person who qualifies? That's what Republicans generally mean when they call for "decentralization" and "flexibility" in Medicaid.

Medicaid Work Requirements: The federal government has historically banned states from imposing work requirements on those who meet state and federal Medicaid enrollment criteria. This January, the Trump-era Center for Medicare and Medicaid Services (CMS) issued new guidance encouraging states to seek waivers to impose such requirements. To date, 14 states have approved or pending waiver requests to impose work requirements -- though a court invalidated Kentucky's.

The vast majority of Medicaid enrollees who are able to work and are subject to states' implemented or pending work requirements do work or have good reasons for not doing so at present. As CBPP summarizes: "60 percent are already working...79 percent have at least one worker in the family. Of those who aren’t themselves working, more than 80 percent are in school or report an illness, disability, or caregiving responsibilities that keep them from working."

There is evidence, moreover, that Medicaid enrollment makes people more able and more likely to work. For example, a study published this July found that  with disabilities were more likely to be employed in states that expanded Medicaid than their peers in non-expansion states, as earning a significant income would no longer disqualify them from coverage.

The work requirements -- and work reporting requirements -- planned or implemented by many states are designed to be onerous -- for example, requiring regular online reporting of work hours from a population that may not have online access or be able to handle complex forms. In Arkansas, where enrollees are required to report online 80 monthly hours of work activities or show they are eligible for an exemption, 4,350 enrollees were dropped in September, the first month that the penalty for failing to report went into effect. Many were unaware that the requirement existed.

In June, a federal judge blocked Kentucky's work requirements from going into effect, "ruling that the federal government is obligated under federal law to consider whether a Medicaid proposal advances the program’s objectives... and the Trump administration failed to meet that standard before approving Kentucky’s plan."

3. Hugin "said he'd eliminate what he called the law's biggest faults -- such as making the sickest patients and the working poor shoulder too much cost." 

Question: What exactly does this mean? ACA cost-sharing does not vary according to health.  For the unsubsidized, or those at the upper income end of subsidy eligibility, choosing a plan with low cost sharing is indeed very expensive. Would Hugin subsidize plans more heavily? He does say he'd "introduce legislation to cap co-pays at $50 per prescription and limit monthly out-of-pocket expenses" for all medical expenses. By how much? The ACA imposes a maximum annual per person out-of-pocket limit of $7,900 for an individual and $15,800 for a family in 2019. That's pretty high, but if Hugin is proposing lower limits that would require higher minimum actuarial value in both the individual and employer markets.

One has to wonder: what party does Hugin think he's joining? The lightly subsidized health plans in the Republican ACA repeal bills carried deductibles in the $5000-11000 range, according to estimates based on the plans' prescribed actuarial values.

As for the working poor, under the ACA they are covered by Medicaid, unless they're in one of the 17 states with Republican governors and/or legislatures that refused the ACA Medicaid expansion. The near-poor, those earning up to twice the Federal Poverty Level, can obtain Cost Sharing Reduction subsidies that make a benchmark silver-level plan more generous than most employer-provided health plans (weaker CSR is available up to 250% FPL). While  the subsidies even at this level are arguably too skimpy, Hugin is in the wrong party if  he wants to make them more generous.

4. [added 10/10/18]: In his op-ed Hugin writes: For too long the Veterans Administration has provided our veterans with what's cheapest instead of what's best. That's why I strongly supported Sen. John McCain's Veterans Community Care and Access Act which would modernize and improve our veterans health care system.

Question: Senator McCain's bill to fund the Veterans Choice Program, providing access to private-sector healthcare to veterans when the VA cannot provide timely care, passed with near-unanimous support. Meanwhile,  A 2015 Rand study found that the VA, while facing many challenges and in need of further investment, outperformed the private sector on most measures.  How do you feel about the movement, advanced by the Koch-funded Concerned Veterans of America (CVA) and other conservative groups, to privatize veterans' care more generally?

Background: CVA is virtually the only veterans' group to support progressive privatization of VA services, but the Trump administration has made CVA's agenda its own. Former VA Secretary David Shulkin, unanimously confirmed by the Senate  claims he was forced out for resisting the privatization drive, pushed by a cabal of three Trump advisers with no formal position. The scandal over long wait times at some VA facilities, while reflecting some real weaknesses, was trumped up and exploited by CVA to force out former VA Secretary Eric Shinseki and open the door to privatization.

More general questions [added 10/10]: Hugin is silent about most of the Republican healthcare agenda. Worth asking:

  • Do you support ACA repeal/replace efforts along the lines of the bills that nearly passed in 2017?
  • Do you support the Texas v. U.S. lawsuit by 20 Republican AGs and governors seeking to have the ACA struck down or its protections for people with preexisting conditions invalidated?
  • Do you support converting Medicare to a "premium support" (voucher) model, as called for in the 2019 House Republican budget and a long string of proposals from Paul Ryan dating back to 2011?
  • Do you support cutting $2 trillion from Medicare and Medicaid over ten years as stipulated in the House Republican budget?

*          *          *

Hugin has not said that he won't support ACA repeal bills that Republicans are certain to introduce if they retain control of the Senate and House. He has not spoken out against the $1.5 trillion in Medicaid cuts over 10 years included in the House budget, or against capping federal Medicaid spending generally. By making vague promises to preserve protections for people with pre-existing conditions, and sponsor legislation to create new subsidies that are completely out of keeping with Republican past behavior and plans, he is creating an impression of moderation in a party that will brook none.

Updated 10/8 with information from the Hugin op-ed now linked to in the top paragraph.

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