Monday, March 25, 2019

2019 ACA Enrollment: More silver loading effects, CSR enrollment down in SBEs

CMS released a final enrollment report for the ACA marketplace today, along with the public use files that provide extensive enrollment breakdowns.

The top lines we already knew: Enrollment in was down 3.8% in 39 HealthCare.gov states, up .09% in 12 state-based exchanges (SBEs), and down 2.7% overall.

CMS adds that the percentage of subsidized enrollees rose from 85% to 87%. Translation: unsubsidized on-exchange enrollment was down 12.8%; subsidized enrollment was down just 0.5%. Off-exchange enrollment in ACA-compliant plans was in meltdown in 2017 and 2018; it remains to be seen whether the contraction continued, in the first year in which the Trump administration was actively promoting lightly regulated, medically underwritten short-term plans.

A few more factoids derived from a first look:

1. Enrollment in plans with Cost Sharing Reduction dropped sharply as a percentage of overall enrollment -- but the drop was concentrated in state-based exchanges for some reason. In all states taken together, CSR enrollment dropped from 53.6% to 50.3% of total enrollment -- but it dropped from 51.3% to 41.2% in SBEs, just downticking from 54.4% to 53.6% in HealthCare.gov states.

Friday, March 22, 2019

Medicare for America might let private insurance thrive

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The Medicare for America Act, soon to be updated and reintroduced by Reps Rosa DeLauro and Jean Schakowsky, is a true "Medicare for anyone" bill. Any employer can buy in* by paying 8% of payroll, and any individual can opt in and pay between $0 and 9.69% of income (on a siding scale) for a plan to be accepted by all providers who accept current Medicare -- i.e. virtually all providers.

While the bill allows employers to keep providing insurance and preserves Medicare Advantage in the individual market, some people appear to read the bill as a phase-out of private insurance.   Kirsten Gillibrand, for example, in a town hall earlier this week, touted a Medicare buy-in for anyone at "4-5% of income" and suggested, "Those insurers -- I don't think they're going to compete...over a couple of years, you're going to transition into single payer."

That would not likely be the case if Medicare for America were to become law, at least not in its current iteration. While low income workers would probably mostly end up in the public program, the bill creates conditions under which employers might still find a competitive advantage in offering top-drawer coverage to higher-paid workers. It also creates conditions under which Medicare Advantage and Medigap policies might compete.

Thursday, March 21, 2019

Medicare for America...for how many candidates?

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Two months after the Kaiser Family Foundation found 74% support for a "plan similar to Medicare open to anyone" that would "allow people to keep the coverage they have," several Democratic presidential candidates appear to have abruptly converged on the idea. The only bill out there that meets this criteria is the Medicare for America Act, introduced last December by Reps  Rosa DeLauro (CT-03) and Rep. Jan Schakowsky (IL-09), and soon to be reintroduced. 

Medicare for America does much more than create a strong public option that both employers and employees can buy into. It also absorbs Medicaid, transforms existing Medicare, and creates universal long term care insurance.  At healthinsurance.org , I ask whether candidates who have embraced the core concept, or some whisper or echo of it, will go for the whole package:
Perhaps it’s pusillanimous to balk at healthcare system transformation because of the certain all-out opposition of all major segments of the healthcare industry, not to say the Republican party and Fox News. But the question remains how much to bite off. The beating heart of Medicare for America, the transformative engine, is employer/employee buy-in to a strong public option, paying Medicare-plus rates and accepted by virtually all providers.

Whether that public option drains out a quarter of the employer-sponsored insurance market, half of it, or all of it, it renders public insurance – and public insurance payment rates – dominant. Candidates who embrace that core element – which harks back to the earliest iterations of the public option concept – may opt to carve it out of the near-total system transformation mandated in Medicare for America. Or they may not. Each candidate needs to think hard about how much mandated transformation within a decade or less they think the system can bear.
I hope you'll read the whole thing

Sunday, March 17, 2019

Would a public option mean fewer claims denials?

Here I'm going to pose a question for which I don't yet have good answers.

One strong appeal of the public option in various Medicare expansion bills -- e.g.,  Medicare X, Choose Medicare, Medicare at 50, Medicare for America -- is access to an all-but-unlimited provider network (effectively eliminating balance billing as well as limited choice of provider). My question To what extent does a national public option also promise to strongly reduce the agony inflicted on patients by coverage denials? And secondarily, to what extent would minimizing denials weaken legitimate cost control?

Pieces of the puzzle are provided by studies of denial rates in various markets and public programs. These studies are based on partial or not-so-partial data sets and may be measuring different things. One question that's often unclear to me when reading them is how many or what kinds of denials directly affect patients, and which are eaten by providers or represent (or trigger) a de facto negotiation between provider and payer. Not to mention how many are justified...

With that caveat, a few data points:

Wednesday, March 13, 2019

Hospital industry will brook no Medicare expansions

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The American Hospital Association has commissioned a study by KNG Health Consulting that fires a warning shot against any expansion of public coverage that draws people out of the private market.

The report purports to show that the Medicare-X Choice Act introduced in 2017 by Senators Bennet and Kaine, establishing a strong national public option in the ACA marketplace, would cut healthcare spending by $1.2 trillion over ten years. Hospital spending would account for $774 billion of the total.  The study also forecasts that 5.5 million uninsured people would gain coverage.

As U.S. per capita healthcare spending is more than double the OECD average, one might think that cutting costs while increasing coverage would be cause for celebration. Of course the AHA doesn't see it that way, and warns of dire results for hospitals resulting from some 35 million people* shifting from private to a public plan that pays Medicare rates for services.  Leaving aside assumptions about hospitals' adaptability, and the study's calculations with respect to hospital revenue, its assumptions about the impact of Medicare-X on enrollment in private insurance strike me as dubious.

Monday, March 11, 2019

New enrollment drops in ACA marketplace have decelerated since 2017

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In my last post, I noted that new enrollment in HealthCare.gov states in 2019 was barely half the 2016 total.  Here I want to spotlight an important point that I noticed late and had to add via update: The sharpest drop in new enrollment was in 2017. Reduced new enrollment, though still quite steep, is a decelerating trend. Conversely, improved retention after first payments are due has accelerated since 2016, though we don't yet have numbers for 2019.

Here's how new enrollment and first-quarter retention have played out since 2016, the year of peak enrollment so far:

New enrollment, HealthCare.gov states, 2016-2019
As of the end of Open Enrollment

2016*
2017
2018
2019
Change, 2016-17
Change, 2017-18
Change, 2018-19
Change, 2016-19
4,044,370
3,013,107
2,460,431
2,072,115
-25.5%
-18.4%
-15.8%
-48.8%

Kentucky retired its SBE and joined HealthCare.gov in 2017. Kentucky new enrollment for 2016 (18,733) is added to the 2016 total above.


Friday, March 08, 2019

The shrinking but retentive ACA marketplace

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n.b. the next post constitutes an update.

One feature of the ACA marketplace under Trump administration: as new enrollment contracts, retention has improved. With enrollment down 10% overall since 2016, the market has apparently contracted to its core: those who are renewing know they need or may need care.

Zeroing out the individual mandate for 2019 cannot have helped new enrollment, though new enrollment shrank just as much in 2018 as in 2019, when the mandate repeal went into effect. As the mandate repeal was pending through the fall of 2017 and became law in December 2017, many may have thought the mandate had been repealed as of 2018 -- if not the whole ACA, as Trump kept screaming. At the same time, discounts generated by silver loading (cheap gold and often-free bronze plans*) have probably improved retention. A higher percentage of enrollees are now subsidized, and the 87% of enrollees who are subsidized are paying lower premiums on average, as Charles Gaba has noted. Attrition has for years been much steeper among unsubsidized enrollees.

Better retention is reflected both in year-over-year renewals and in the level of attrition after first payments are due and throughout the year. In the 39 HealthCare.gov states, renewals were up slightly in 2019, while new enrollment shrank 16% (see CMS final snapshots 2019 vs. 2018). In California, the largest state-based exchange (SBE),  renewals were up 7.5% while new enrollment contracted 24%. Overall enrollment was down 4% in HealthCare.gov states and virtually flat (down 0.5%) in California.

Wednesday, March 06, 2019

Blue states willing to invest in ACA marketplace: Help those over 400% FPL or under?

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From the beginning, the ACA's apparent Achilles heel has been the plight of those who must look to the individual market for coverage but earn too much to qualify for subsidies.

I say "apparent" because the marketplace is not exactly a roaring success among those eligible for subsidies. But bear with me through a short history of the highly visible plight of the unsubsidized.

Saturday, March 02, 2019

The public option we really need

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I have argued, recently and also over time, that a public option introduced into the current ACA marketplace without a change in marketplace structure can only do so much good

The marketplace's dominant flaw is that it's under-subsidized, and a public option won't make coverage more affordable for subsidized buyers. If you're a solo person earning $31,000 per year and have to pay $220/month for a public plan with an actuarial value of 70% -- likely with a $3000 deductible --that's not going to look much more attractive than comparable private plans. The public plan may drive down base premiums and so help unsubsidized buyers.

Tuesday, February 26, 2019

A public option to get claims paid

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The top line in a new Kaiser Family Foundation analysis of claims data collected by CMS from insurers selling plans on HealthCare.gov is startling:
We find that, across issuers with complete data, 19% of in-network claims were denied by issuers in 2017, with denial rates for specific issuers varying significantly around this average, from less than 1% to more than 40%.
Caveats abound. Of 180 insurers selling plans on HealthCare.gov, only 130 submitted complete data enabling analysis by Kaiser.  The data does not include standardized "reason codes" and lumps together all denials, "including denials due to ineligibility, denials due to incorrect submission or billing, duplicate claims, and denials based on medical necessity." Most important, perhaps, there is no comparative data for employer-sponsored plans, which insure 15 times as many people as the marketplace (nor for off-exchange ACA-compliant plans).

There is, however, one useful point of comparison. Medicare Advantage plans deny 8% of claims, according to a September 2018 report from the Office of the Inspector General for HHS. That seems high in itself, but it's less than half the ACA marketplace rate, at least in the 39 HealthCare.gov states.

Monday, February 25, 2019

On modular Medicare expansions

On the BlueWaveNJ blog, I have a post ruminating over where a successful Democratic presidential candidate might land with respect to various bills and plan outlines to establish Medicare for All, Medicare for All Who Want or Need It, Medicare for More, etc. I speculate that such candidate might want to make a build-out as modular as possible:
A candidate who seeks flexibility might seek to make her plan as modular as possible. First steps might include a strong public option introduced into the ACA -- one tied to Medicare rates,that providers who accept Medicare would have to accept.  Such a plan would probably also entail raising the value of a benchmark ACA plan, as the Merkley-Murphy Choose Medicare Act does. The ACA's silver plan benchmark, designed to cover 70% of the average enrollee's costs, clearly has not cut it with the public (in some cases, it now includes deductibles as high as $6,000). Incremental steps could include allowing small business buy-in and then large employer buy-in.  Integrating first steps with an ACA upgrade enables next steps to be contingent -- on need, budget and system performance. 
The case against this would be losing a window to mandate sweeping systemic change. I can see that. In any case, I hope you'll take a look at my view of the spectrum of possibility.

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Sunday, February 24, 2019

X-factor in Medicare X: A silver plan discount?

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The Medicare-X Choice Act of 2017, introduced by Senators Bennet (D-CO), Kaine (D-VA) and Feinstein (D-CA), offers a more incremental and modest expansion of Medicare than more recently introduced Medicare expansion* bills such as the Medicare for America Act or the Choose Medicare Act.

When the bill was introduced, the last of the ACA repeal bills had just been defeated and the ACA marketplace was perceived as more fragile than it is at present. Insurers had recorded big losses in 2016 and jacked up their rates in 2017, which proved to be a year in which they returned to profitability in the individual market. The specter of "bare counties," in which no insurer participated, had just receded. The bill accordingly takes as its starting point a proposal Obama himself had floated in a 2016 JAMA article: A public option to be offered in counties where no private insurers, or just one, had opted to participate.  By 2023, however, "Medicare-X" would be offered in all counties in the individual market, and in 2024, in the small group market as well.

Medicare-X would create a public option within the ACA exchange, offering ACA-compliant coverage at ACA metal levels. It does not directly enrich ACA subsidies or expand eligibility for them. Unlike Medicare for America or Choose Medicare, Medicare-X does not allow a subsidized buy-in for employees if their employers offer ACA-compliant insurance. Nor does it touch Medicaid or existing Medicare programs.

Thursday, February 21, 2019

A hole in the heart of Medicaid/Medicare buy-in plans

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A catch-22 bedevils Medicaid or Medicare buy-in plans designed to co-exist with the ACA marketplace, whether on the state or national level.

On one hand: If the public option is integrated into the marketplace and conforms to ACA benefit and subsidy levels, it won't help subsidized buyers much. They will still pay the same premium for the same level of benchmark plan benefits. The affordability of their options besides the benchmark plan depends on price spreads -- how much less or more other options cost compared to the benchmark. It's highly unpredictable how a public option will affect those spreads -- unless the silver public option plan is the cheapest in that market and way cheaper than the benchmark.

A public option may help unsubsidized buyers by providing a low-overhead choice and possibly stimulating lower unsubsidized premiums across the board. That helps the federal treasury too. But it may compress premium spreads and so make subsidized buyers' choices worse. The problem for subsidized buyers (over 85% of enrollees on ACA exchanges and over 60% of enrollees in ACA-compliant plans) is that the marketplace is under-subsidized. Premiums and out-of-pocket costs are just too high at income levels above 150% FPL.

Wednesday, February 20, 2019

Federal government's new CSR liability boosts Democrats' leverage in Congress

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Good news: Democrats in Congress understand that if they're going to join with Republicans to appropriate funds to  directly reimburse health insurers for Cost Sharing Reduction (CSR), they need to extract a price. They have the leverage to demand a price -- and two federal judges increased that leverage last week in rulings that vastly increased the government's potential liability for stopping direct CSR payment.  A letter to CMS Administrator Seema Verma from Democratic Senators Patty Murray and Ron Wyden and Reps Frank Pallone and Bobby Scott flexes that leverage.

Briefly: The ACA directs the federal government to reimburse insurers for the CSR they are legally obligated to provide to marketplace enrollees with incomes below 250% of the Federal Poverty Level who select silver plans. In one of several fits of absent-mindedness, the ACA's creators neglected to make the payment part of mandatory spending, leaving it to Congress to appropriate funds. The Republican Congress did not appropriate; the Obama administration made the payments anyway; the Republican House sued to stop them; and Trump cut the payments off in October 2017. State regulators, having prepared during the long months that Trump threatened the cutoff, allowed insurers to price CSR into premiums for silver plans only, since CSR is available only with silver. Since income-adjusted premium subsidies are set against a silver benchmark, "silver loading" predictably created discounts in gold and bronze plans. That created a bounty for many subsidized enrollees with incomes too high to qualify for strong CSR -- i.e. those with incomes in the 200-400% FPL range.

Tuesday, February 19, 2019

Medicare at 50 Act: A bonanza for low income near-elderly

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The Medicare at 50 bill introduced last week by Senator Debbie Stabenow (D-MI) is a pretty bare outline that raises a lot of questions.

The bill allows people aged 50-64 to buy into Medicare. Those who qualify for ACA tax credits -- i.e., have incomes below 401% of the Federal Poverty Level and lack access to employer-sponsored insurance, Medicaid or other public insurance -- can apply those credits to the Medicare premium.  No new program is created; no adjustments to the over-65 Medicare benefit to make the program fit the needs of younger enrollees are specified.  To note a few oddities:

1) Enrollees can choose traditional fee-for-service Medicare (Parts A, B, D) or a Medicare Advantage plan. No annual cap on out-of-pocket costs is added to traditional Medicare, so those who choose it will forgo that ACA marketplace benefit, which currently caps costs at about $7,900 per person -- unless they qualify for Cost Sharing Reduction (CSR), per the next point below.  Enrollees in traditional Medicare can buy Medigap policies on a guaranteed issue basis. With no OOP cap, traditional Medicare would not qualify as ACA-compliant coverage -- except that the bill specifies that it shall.

Monday, February 18, 2019

The Choose Medicare Act: How strong is this public option?

The Medicare for America Act, introduced last December by Reps Rosa DeLauro (CT-03) and Jan Schakowsky (IL-09), is a halfway house -- or two-thirds-way house -- to single payer -- and arguably a complete route to all-payer.  This bill (summary here) creates a revamped Medicare that auto-enrolls all children born in 2022; allows employers and employees to buy in; and folds in Medicaid and senior Medicare. It preservers a role for private insurance, via Medicare Advantage and the remaining option for employers to provide private insurance.

The bill would effect a less radical and somewhat more gradual transformation of American healthcare than Bernie Sanders' Medicare for All bill -- but a sweeping, sudden and very expensive transformation nonetheless, undertaking to transform Medicaid, senior Medicare, and long-term care (for which it provides coverage) as well as the individual and employer markets (the latter would be empowered to pay Medicare rates, set at 110% of current Medicare in the new public program). Insurers should be able to ultimately live with it; providers would fight it tooth and nail.

For those more comfortable with more incremental change, the Choose Medicare Act introduced by Senators Jeff Merkley (D-OR) and Chris Murphy (D-CT) last April (summary here) has a somewhat similar architecture but does not a) autoenroll newborns, b) fold in Medicaid, c) include long-term care or d) much change senior Medicare, except to add a yearly cap on out-of-pocket expenses to traditional Medicare.  What it does do:

Friday, February 15, 2019

What if the Obama administration had ended direct CSR reimbursement in 2016?

Trump's bid to fund his wall with money not appropriated by Congress has set me thinking about the Obama administration's far better grounded, but still dubious, determination to fund the ACA's Cost Sharing Reduction (CSR) subsidies without an explicit appropriation from Congress.

That decision was challenged in court by the Republican Congress in 2014 and, with the suit still pending, countermanded by Trump in October 2017, with disruptive but far from catastrophic consequences.

I'm thinking not of tendentious comparisons between Obama's executive actions and Trump's, but rather about a counterfactual: What if the Obama administration had taken the likely Congressional refusal to appropriate funds at face value, and declined to directly fund CSR?

Wednesday, February 13, 2019

Should Democrats seek to kill the anti-ACA lawsuit with legislation? Bagley v. Jost

Progressive legal opinion is divided with respect to how Democrats should fight the latest ridiculous suit seeking to have the ACA declared unconstitutional, Texas v. U.S., The suit was upheld in December by an extremist U.S. District Court judge in Texas, Reed O'Connor, who stayed the ruling pending appeal.

The question: should the Democratic House simply join the defense against the suit in court, which it has opted to do, or also pass legislation that would render the suit moot if it became law? Taking opposite sides are two progressive stalwarts of the ACA's legal wars.

Tuesday, February 12, 2019

The water is wide: Health Policy Valentines 2019

Postscript, Feb. 17: Inspired by an inhalation, one ex post factoid #HealthPolicyValentine:



                                                                 Roses are comely,
                                                                 Lilies are aromatic.
                                                                 Enrollment in Medicare at birth
                                                                 May soon be automatic.

                                                                    *          *         *

Love grows old, and waxes cold...but HealthPolicyValentines must be maintained (or endured) year over year.  So here we go again, with a cache that should grow through 2/14.

For those who never get enough, here's Health Policy Valentines (2018) Love Knows No Repeal (2017),  Love in the Time of Obamacare (2016), love, 2015, and first love, 2014.

Untriggered warning: many of these are valentines to Twitter's healthcare stalwarts. I'll leave the footnotes to the Norton anthologist...

The water is wide,
I cannot get o'er.
Universal healthcare
Is on the far shore.

   *     *     *

Courting is pleasure,
And parting is grief,
But a Utah legislator
Is worse than a thief.

   *     *     *

Medicare for All
Is your fantasy lover.
Medicare E
May get everyone covered.

   *     *     *

Saturday, February 09, 2019

Medicaid expansion to just 100% FPL: What's the effect on marketplace risk pool?

Utah legislators voted this week to contravene the will of Utah voters, expressed in a 2018 referendum, by limiting the ACA Medicaid expansion to adults with incomes up to 100% of the Federal Poverty Level, instead of the 138% FPL threshold stipulated by the ACA statute and the referendum.

The more limited expansion would be bad for Utahns in the 101-138% FPL range, as explained below, though it would save the state some outlays (if approved by CMS), since the federal government pays 100% of marketplace subsidies and "only" 90% of premiums for the Medicaid expansion population.

Leaving aside for a moment the effect on low income Utahns, and on state finances, I want to consider a tertiary question: How would expansion affect the risk pool in the state's ACA marketplace? (David Anderson has touched on this, at least on Twitter, and may be looking at it in more depth.)

In 2016 the answer would have been straightforward: the 101-138% FPL population is less healthy on average than higher income enrollees, and so raises costs and premiums. A 2016 CMS study estimated that premiums are about 7 percent lower in expansion states, controlling for a variety of other factors.

Does silver loading improve the risk pool?

The picture has been clouded, however, by "silver loading" -- state marketplaces' adaptation to Trump's cutoff of direct reimbursement of insurers for Cost Sharing Reduction subsidies that they are obligated to provide to low income enrollees who select silver plans. Those subsidies are highest in the 100-150% FPL range, where they raise the actuarial value of a silver plan from a baseline of 70% to 94%.

Wednesday, February 06, 2019

How many might be loathe to trade employer-sponsored insurance for expanded Medicare?

In my last post, I stressed that a significant and politically powerful subset of the 156-odd million Americans who get health insurance through employers have coverage way better than the norm. Those with the most generous employer-sponsored coverage (ESI) might be averse to transitioning to a public plan with significant cost sharing -- say, to a plan with coverage comparable to a typical Medicare Advantage plan.

Out-of-pocket costs for enrollees in ESI have risen rapidly in recent years; premiums have risen more slowly, but steadily. Nonetheless, a lot of people have coverage a good deal more generous than the norms reported in the Kaiser Family Foundation's 2018 Employer Health Benefits Survey -- e.g., deductibles well below the $1,573 average for single coverage, and premiums well below the $99 per month average for single and $462/month average for family coverage.

The figures below**, taken from the Kaiser survey, highlight benefits enjoyed by insured employees with the most generous coverage.
  • For 12% of covered workers, the employer pays 100% of the premium for single coverage. Another 8% of workers in single coverage pay less than $500 per year. Just 3% of covered workers pay nothing for family coverage; another 4%, pay under $1500 annually.

Tuesday, February 05, 2019

What to expect when Democrats are weighing single payer

Last week, Kamala Harris was asked about her support for single payer healthcare and responded, with respect to employer-sponsored insurance, "let's eliminate all that. Let's move on." Then Cory Booker was asked an imprecisely worded question  -- would he "do away with private health care" --  and gave an equally imprecise answer (no..) that left ambiguous whether health care or health insurance was under discussion. Ever since, warnings have been percolating on healthcare Twitter against framing single payer as all-or-nothing -- no more private insurance, or no Medicare for all.

Now cometh Sarah Kliff to inject some nuance. One point: "even countries we think of as single-payer still have some level of employer-provided health insurance." In Canada, everyone has "Medicare" -- fairly comprehensive insurance in which government (provincial and federal) does pay the providers. But most people also have employer-provided supplemental insurance to cover prescription drugs, dental, vision, and/or other services not covered by Canadian Medicare.

Another point: whether a transition away from private primary insurance in the U.S. is successful depends mainly on what people are asked to transition to:
Transitioning half of all Americans from one type of health insurance to another is no-doubt a huge undertaking. But whether or not it’s successful, I think, rests on what kind of coverage is on the other end. If it’s a government plan where Americans feel like they can afford to go to the doctor, then I’d expect any frustration with the transition to eventually dissipate. If it’s a government plan where co-payments and deductibles are high — especially if they’re higher than employer-sponsored coverage — then frustrations would almost certainly only grow over time.
Quite so. But I'd like to add some nuance to the nuance, on a couple of fronts.

Saturday, February 02, 2019

Beyond healthcare reform at Health Action 2019

Sharice Davids at Health Action 2019

For the past three Januaries, it's been my delight to attend Families USA's annual Health Action conference, which brings together healthcare advocates, enrollment counselors, scholars and policymakers to analyze the functioning and malfunctioning of U.S. healthcare and report on plans to improve access and delivery.

As my experience of the conference dates to the dawn of the Trump era, it's wedded in my mind to the high drama of resisting massive rollback of the federal commitment to make healthcare affordable to most (we're still far from all) who make their home in the U.S.

In 2017, the dominant chord was to my mind struck by incoming FUSA executive director Frederick Isasi:  "Our action should lead to inaction."  That is, ACA defenders needed to slow down Republicans' legislative drive to repeal the ACA to make it run aground on its own contradictions.

That...happened. The 2018 conference celebrated, reliving miracles wrought by the Little Lobbyists, Indivisible, ADAPT and others who brought home the human cost of repeal.  It was also a forum for feeling out the shape of healthcare reform to come. I wrote last year that the tea leaves seemed to shadow forth a Medicare-like public option that employers and employees could buy into, as Jacob Hacker proposed back in 2007. That still seems to me where we're headed.

This year too had its note of triumph and promise -- beginning with a keynote from Nancy Pelosi celebrating the centrality of healthcare in the November election. Yet the really sustained focus, through three plenary sessions was on the gross inequities, based mainly on race and ethnicity, in our healthcare delivery system and beyond, in housing, criminal justice, mental health, diet -- basic conditions of life that shape health (actually, that was true last year too).

A persistent theme was that a lot more has to change than the number of people with insurance that provides access to healthcare as we know it. Another was the enormous challenge of moving equity to the center of system reform efforts.

Sunday, January 27, 2019

"They saw everything through the prism of healthcare" -- Pelosi at Health Action 2019

Pelosi at Health Action 2019

I've just started going through my notes from Health Action 2019, Families USA's annual conference, which is always a delight to me, as recounted here (for 2018) and here (2017). I'm reminded that in her 15 minute keynote, Nancy Pelosi actually said something of substance It's here, beginning at about 12:15 (my emphasis):
God truly blessed America with the activism of all of you. It made so much difference..we not only want the grass roots to mobilize, we want them to give us their view of what public policy should be, and how we message that public policy. That was our success in the last two years, because we would say, 'this is what we need to do, how does this translate to the people who are out there?' And they saw everything, the grassroots we were working with  -- including many of you --  through the prism of healthcare. If you want to talk about the tax bill, talk about healthcare...Republicans say about the tax bill, it doesn't really increase the deficit, but if it does, we'll take a trillion dollars out of Medicaid, we'll take a half a trillion dollars out of Medicare. So again, the point being, the effective messaging is what worked at the grassroots level, which encourages people to take advocacy action, to make the calls, to show up at the town halls, to do the sit-ins, all the activism that you know very well. So I'm here to say thank you in all of you. I hope again that you take satisfaction in all you do.

Friday, January 18, 2019

Oh, BTW...Trump administration wants Congress to fund CSR

Progressives' alarm bells went off on several fronts yesterday after  CMS belatedly released the annual Notice of Benefit and Payment Parameters (NBPP) yesterday.

Chief among the causes of alarm: the NPBB appears to put silver loading on the chopping block for 2021. Very briefly, silver loading began in 2018 in response to Trump's abrupt cutoff in October 2017 of direct reimbursement to insurers for Cost Sharing Reduction (CSR) subsidies available to low income marketplace enrollees. State regulators and insurers responded by pricing CSR into silver plans only, since CSR is available only with silver plans. Since income-based ACA premium subsidies are based on a silver benchmark, silver loading generated major discounts in bronze and gold plans.

The NBPP suggests that silver loading places an undue burden on taxpayers. But in addition to a call for proposals for "potential action," something else is, I believe, new here:
Silver loading is the result of Congress not appropriating funds to pay CSRs, with the result being an increase to the premiums of benchmark plans used to calculate premium tax credits, and the federal deficit. 112 The Administration supports a legislative solution that would appropriate CSR payments and end silver loading. In the absence of Congressional action, we seek comment on ways in which HHS might address silver loading, for potential action in future rulemaking applicable not sooner than plan year 2021 (p. 190). 
Question: is this not the first time the Trump administration has explicitly (or at least formally) called for a Congressional appropriation to fund CSR the old way -- by reimbursing insurers directly for providing it?  That seems significant to me, and raises the question of whether last year's Alexander-Murray legislation, purporting to strengthen the ACA marketplace, might be revived in a divided Congress.

As originally conceived, Alexander-Murray had three main components: federal funding to states for reinsurance programs, which reduce marketplace premiums; a loosening of the "guardrails" constraining ACA innovation waivers, which empower states to propose changes (and theoretically, complete redesigns) of ACA marketplace structure; and appropriations to fund CSR. It foundered on a poison pill concerning abortion -- as well as on Democrats' recognition that silver loading had improved marketplace subsidies for millions and boosted enrollment, partially offsetting other forms of administration sabotage.

Given those realities, Democrats would have to extract a price for CSR reimbursement. Consider these facts about silver loading:
  • By CBO estimate, the cutoff of direct CSR reimbursement and resulting silver loading would cost $194 billion over 10 years.
  • According to the NBPP, "For the first half of 2018...16 percent of enrollees were enrolled in a plan with zero premiums after application of advance payments of the premium tax credit, another 19 percent of enrollees paid a premium of less than 5 percent of the total plan premium" (p.10). That's largely a result of silver loading, which made $0 premium bronze plans widely available -- as is a doubling of gold plan enrollments in 2018.
  • Silver loading likely boosted enrollment by at least 300,000 in 2018. CBO forecasts that  the enrollment boost will reach 2-3 million annually as silver loading continues.
Given the multiple other steps HHS and the Republican Congress have taken to depress marketplace enrollment -- including  in the 2020 NBPP, such as a threat in 2021 to auto-re-enrollment -- there's no way Democrats can give up the silver loading windfall without trading it for a less haphazard boost to marketplace funding. [Update: OTOH, CMS's clear threat here to end silver loading does reduce their leverage.]

Generous reinsurance funding might be one answer. But that would trade a major benefit to subsidized enrollees for a benefit to unsubsidized enrollees. As New Jersey's experience in 2019 enrollment demonstrates, reductions in base (unsubsidized) premiums don't help subsidized enrollees, and may hurt overall enrollment.  

A cap on premiums as a percentage of income for all enrollees, including those above the current 400% FPL subsidy cutoff, would also benefit more affluent enrollees, but in a more direct, predictable and thoroughgoing way.  Improving subsidies at 200-400% FPL, the range in which CSR is negligible or nonexistent, should also be a major priority. This is the income range in which silver loading had its chief impact.  And frankly, ACA premiums and out-of-pocket costs can look pretty daunting at 150-200% FPL too.

A deal to fund CSR remains unlikely - -and if one were to transpire, the offset to the silver loading loss would probably have to be pretty simple, such as a cap on premiums as a percentage of income, perhaps only to, say, 500% or 600% FPL. But the Trump administration's direct call in official guidance for a CSR appropriation should not pass unnoticed.

Another aspect of Alexander-Murray that might reverberate differently this year is the loosening of ACA Section 1332 innovation waiver barriers. In brief, in the time since Alexander-Murray died, the Trump administration has hacked so violently at the Section 1332 guardrails that the bill's language might actually at least modestly rebuild them, rather than lower them. But I'll have to return to that subject, as the day job calls just now.


Wednesday, January 16, 2019

Medicare for all (who want or need it): A path for presidential candidates

As working assumptions tend crystalize (or harden) unnoticed, I've long assumed that the U.S. can't achieve or even mandate Medicare for All in one leap. The tax hikes are too much for Americans to tolerate, as is transformation by fiat of enormous (and enormously profitable) industries.

Since at least the early aughts, various plans have mapped out Medicare expansion by degrees. In its early iterations, the 'public option' was essentially a Medicare extension offered to people who lacked access to other insurance -- with a buy-in option for employers and/or employees. Some versions envisioned employer-sponsored insurance dying rather rapidly on the vine; others foresaw permanent competition between ESI and the public plan; and others left the question open.

Plans of this sort include Helen Halpin's CHOICE program (2003), Rep. Peter Stark's Americare plan (2006), and Jacob Hacker's Health Care for America plan (2007), all of which allowed employers to buy in to the public plan via a payroll tax. Current iterations include Jeff Merkley and Chris Murphy's Choose Medicare Act, Tim Kaine and Michael Bennett's Medicare X Choice Act (buy-in for small biz only)  and the Center for American Progress's Medicare Extra [update, 1/22: the Medicare for America Act, introduced last December by Reps Rosa DeLauro (CT-03) and  Jan Schakowsky (IL-09), is a close cousin of Medicare Extra. Charles Gaba has a rundown here.]

David Anderson recently outlined the intense challenge Democrats will face, should they gain the presidency and both houses of Congress (with a presumably razor thin Senate majority at best), in prioritizing among a huge list of agenda items demanding Senate floor time in particular (and that's assuming not only that Dems win a trifecta but that all energy isn't absorbed by some megacrisis).  I would add that if an incoming Democratic president chooses not to make healthcare reform priority number 1, patching the ACA would serve as a kind of placeholder. Such patches might start with capping individual market premiums as a percentage of income for all comers and, with varying degrees of cost and complexity, enriching and redesigning the subsidy structure.

What if the newly elected president has run on some kind of commitment to Medicare for all? I suspect the eventual winner (if a Democrat) is likely to hedge, as many Congressional candidates did, and advocate a path to Medicare for all, as the plans outlined above do.

Saturday, January 12, 2019

A word from our sponsors

Well, the sponsor is me, and the "our" is royal. A while back, I took the subscribe button off this blog because hundreds of spam subscriptions had flooded in. I've restored it, top right, so please subscribe if you haven't. I've been averaging about one post every three days, so that's roughly how much email you'll get. Thanks...

Friday, January 11, 2019

One more offset from silver loading

It seems clear that the discounts in bronze and gold plans created by silver loading -- the pricing in of Cost Sharing Reduction into silver plans only after Trump cut off direct reimbursement for the benefit* -- have partly offset enrollment losses in the ACA marketplace caused by other forms of sabotage, e.g., the gutting of federal funding for advertising and enrollment assistance and repeal of the individual mandate penalty. Silver loading may have boosted enrollment by 3-4% in 2018.

The effects of silver loading are likely more intense in states that have rejected the ACA Medicaid expansion. Roughly a third of enrollees in those states would be Medicaid-eligible had the state expanded, and about 90% of enrollees in the should-have-been-in-Medicaid income range (100-138% FPL) select silver plans and so access the strongest form of CSR, available up to 150% FPL.  As noted in my last post, more intense silver loading in nonexpansion states may very well be a major factor in why enrollment losses were smaller in nonexpansion states on HealthCare.gov than in expansion states on the platform (though expansion states with their own marketplaces have done better than both).

Silver loading may provide a second form of "offset" to nonexpansion states. In 2016, a CMS analysis concluded that premiums in Medicaid expansion states were about 7% lower than in nonexpansion states,, controlling for various other factors. That's presumably because this lowest income cohort (100-138% FPL) has more intense health needs on average than enrollees at higher income levels.

Wednesday, January 09, 2019

Why 2019 ACA enrollment drops were concentrated in Medicaid expansion states on HealthCare.gov, Take 3

I have been trying to figure out why (if there is any why) the overall 3.8% enrollment loss in HealthCare.gov states in 2019 was concentrated almost entirely in states on the platform that have enacted the ACA Medicaid expansion. Enrollment in the 21 HealthCare.gov states that have expanded Medicaid (excluding Virginia and Maine, where expansion was in progress or pending) is down 7% in 2019. It's down less than 1% in the 16 nonexpansion states.

David Anderson, while focused elsewhere, may have provided an answer:

Tuesday, January 08, 2019

ACA 2.0 in California: an individual mandate without shame and a move toward all-payer in pharma

Yesterday California's new Governor, Gavin Newsom "announced a series of major, first-in-the-nation executive actions and budget proposals to lower prescription drug and health care costs for all California families and move California closer to the goal of health care for all."

A couple of quick thoughts about the package:

1. The ACA-related proposals are to raise the subsidy cap to 600% FPL while enriching current subsidies -- and to implement a state individual mandate. That pairing addresses the fatal flaw in the ACA individual mandate, which New Jersey's disappointing enrollment performance following passage of a state individual mandate illustrates: subsidies are too skimpy (if available at all) to make the coverage on offer seem like a good deal to many who are required to obtain it.

Try telling someone with an income of $30k that a silver plan with a deductible of $2,500 will cost them $200 a month, or that a bronze plan with a $3k deductible will cost, $137 a month.That was the deal on offer for a 40 year-old in most of Jersey in 2019; in most other states, the deductibles would have been higher, though the bronze premium would in many cases be lower. My duty as an ACA Certified Application Counselor has been light, but I've seen enough to know that that kind of result does not make many prospective enrollee happy* (the case is different at lower incomes -- say, $17-20k for an individual, where strong Cost Sharing Reduction is available).  The case is often much worse for those with incomes above the subsidy threshold. In many states, premiums had risen high enough by 2018 that many people in the 400-600% FPL  income range and above were exempt from the mandate.

Friday, January 04, 2019

New Jersey's disappointing 2019 ACA enrollment: Some perspective

Policymakers in New Jersey were disappointed by enrollment in the state's ACA marketplace in 2019, which came in 7.1% behind 2018 enrollment. In the 39 states using HealthCare.gov, the federal exchange, enrollment was down 3.8%, and in the 12 states (plus DC) that have their own exchanges, it's likely to come in flat (enrollment is not over in several of them).

The state had acted swiftly in the first half of 2018 to pass a state-based individual mandate and get a reinsurance program enacted by legislation  and approved/funded by CMS. As a result, premiums were down an average of 9% in 2019, and 22% below where they would have been had no action been taken.

But base premiums affect only unsubsidized buyers, and in 2019 premiums in New Jersey were actually higher than in 2018 for most subsidized enrollees, as benchmark silver plan premiums, which determine subsidies dropped further than the average for all plans. For a 40 year-old with an income of $30k, the cheapest bronze plan cost 12-22% more in 2019 than in 2018 (varying by region) -- that is, $13-$25 more per month. Cheapest silver was also up slightly in most of the state.  There's some hope that off-exchange enrollment will show some improvement, as that's where the benefit from lower premiums comes home. We'll know when the state publishes first-quarter off-exchange enrollment in the spring.

Wednesday, January 02, 2019

When states expand Medicaid, is there a multi-year marketplace drain?

Happy New Year to the 200,000 Virginians who have gained Medicaid coverage through the state's Medicaid expansion, which went into effect today. Enrollment began on November 1. ACA marketplace enrollment in Virginia is accordingly down 16%, from 400,000 in 2018 to 334,000 this year. The vast majority of that drop is attributable to the Medicaid expansion, as Virginians with incomes in the 100-138% FPL range, previously eligible for marketplace coverage, are now eligible for Medicaid.

I had previously calculated that just shy of 100,000 Virginians who were enrolled in the ACA marketplace as of the end of open enrollment for 2018 would likely be eligible for Medicaid. the enrollment drop attributable to Medicaid is probably a bit more than half that number. That fits a pattern, I think, established in other states that enacted belated Medicaid expansions. Expansion appears to drive marketplace enrollment reductions for more than one year.

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