Consumer Power Report #385
This past week I attended and spoke at the Colorado Health Symposium. A few lessons gathered from the first two days of conversation:
First, lefty policy wonks are increasingly worried the health insurance exchanges are going to be problematic, and in some states, non-functional. Colorado is actually much better off in this capacity thanks to a bipartisan exchange bill – they anticipate having as many as 19 insurers in the exchange – but an attendee from Delaware who’s on the board of the exchange there anticipates they will have just two insurers participating (in his words, “some marketplace that is”). A board member for the Colorado exchange shared with me his concerns that the fraud prevention mechanisms they have are simply not ready for prime time, and they would much rather have another year to get things right … but the politics of it make this impossible.
Second, the concern over rate shock is tangible and real. My presentation focused on this issue, and the attendees responded with an outpouring of personal stories about how skeptical they are that young and healthy people will sign up. Two mothers, both liberal health policy activists, described how hard they had to work to convince their 25- and 26-year-old sons to sign up for insurance at all (“but mom, it’s more than $100 a month!”). The audience laughed when I quoted from the recent piece from Timothy Jost suggesting young and healthy people would sign up out of a sense of social obligation.
Third, there is an abiding sense of frustration that the work of implementing has been difficult and is behind schedule, but the real problem is the public relations side – for which they blame the administration. Descriptions of PR failings and frustration among the law’s supporters are everywhere. John Iglehart, founder of Health Affairs, described his frustration that the Obama administration has not approached the promotional efforts for the law with the same degree of investment and verve as the president’s campaign for re-election, and he openly questioned whether this could prove to be the law’s undoing.
Fourth, there is a marked preference for talking about the Medicaid expansion issues over the exchanges. Part of this is about concerns over their functionality, but in reality, it’s an opportunity for them to talk about the “right kind” of Republican, one who displays “leadership” and “reasonable qualities” and that sort of thing, as opposed to the intransigent knotheads on Capitol Hill. This leads to the odd circumstance of members of Common Cause talking about how Arizona’s Jan Brewer is, and I quote, a “profile in courage worthy of the Kennedy School” for insisting on expansion, and women’s health advocates talking about how John Kasich represents “just the kind of Republican we need more of.” Bedfellows, etc.
Finally, I think there is now more willingness than ever of the lefty health policy types to admit Obamacare solves very little in terms of what it is aiming to achieve. Meeting people who have dropped out of the affordable care organizations (ACO) approach over its complexity, who have become frustrated with dawdling by the Centers for Medicare and Medicaid Service (CMS), who are realizing this law actually offers them very little in terms of a step toward their long-term goals … it’s an illuminating experience. The conversations go like this: “It was the right thing to do … but it has a ton of problems … and we have to start thinking about what comes next.” This recognition took hold among the smarter liberals in Washington years ago, but it’s now devolved to the state level. This is an encouraging sign, as it represents recognition on the left’s part that post–2016, this law is going to be reopened, reformed, and significantly altered at a minimum. The only question is whether, based on the outcome of the next two elections, you end up with a next step that has a handful of Democrats or a handful of Republicans. That could lead to significantly different outcomes.
— Benjamin Domenech
IN THIS ISSUE:
Well, there you go.
Reid said he thinks the country has to “work our way past” insurance-based health care during a Friday night appearance on Vegas PBS’ program “Nevada Week in Review.”
“What we’ve done with Obamacare is have a step in the right direction, but we’re far from having something that’s going to work forever,” Reid said.
When then asked by panelist Steve Sebelius whether he meant ultimately the country would have to have a health care system that abandoned insurance as the means of accessing it, Reid said: “Yes, yes. Absolutely, yes.”
The idea of introducing a single-payer national health care system to the United States, or even just a public option, sent lawmakers into a tizzy back in 2009, when Reid was negotiating the health care bill.
“We had a real good run at the public option … don’t think we didn’t have a tremendous number of people who wanted a single-payer system,” Reid said on the PBS program, recalling how then-Sen. Joe Lieberman’s opposition to the idea of a public option made them abandon the notion and start from scratch.
Eventually, Reid decided the public option was unworkable.
“We had to get a majority of votes,” Reid said. “In fact, we had to get a little extra in the Senate, we have to get 60.”
SOURCE: Las Vegas Sun
Almost 70 percent of uninsured consumers with a pre-existing condition haven’t yet decided whether they will buy coverage when the health insurance exchanges open in October, according to a survey from InsuranceQuotes.com, a Web-based insurance quote service.
For the first time, the reform law prohibits insurers from discriminating against consumers with pre-existing conditions, preventing them from denying them coverage or charging them much higher rates, FierceHealthPayer previously reported.
But will this consumer group actually take advantage of their newfound coverage options? The survey of about 3,000 adults shows that 68 percent aren’t sure yet, while 57 percent of the uninsured consumers without any pre-exiting conditions also can’t decide whether they will buy health coverage.
InsuranceQuotes.com said 37 percent of its survey population had a pre-existing condition, ranging from acne to high blood pressure to cancer. And about 16 percent of those survey participants were also uninsured.
How people are experiencing life under the new system.
One of the things Obamacare is doing is forcing Medicare’s CMS to cut back on quite a lot of rehabilitation services. CMS, even though it is officially for Medicare and Medicaid, is something that governs reimbursement for all insurance. It sets prices for every single medical procedure and device, etc., etc. Hospitals’ ability to seek reimbursement for something, regardless of whether the insurance is private or not, is set by CMS. It is the Big Brother of healthcare. Even though CMS has been in place for a very long time it is the whip hand for Obamacare rationing.
One of the things that changed for “new” stroke patients was limiting reimbursable therapy visits of all kinds for stroke patients to ten total (because my strokes had happened before the change I was grandfathered in, so to speak). Ten!
I have had well north of 200 visits. At upwards of $250/visit for most therapy not many folks could sustain that for long without insurance (and remember, jobs go away when you’re in the hospital as long as I was). Had I been restricted to ten visits my best case scenario would have involved a home nurse. I wouldn’t have been able to find work. And had I been single (as many stroke patients are because they’re elderly and their spouse has passed) I would have become destitute, thus likely landing in the Medicaid system, eventually.
That’s an incredible and frightening amount of power to be put in the hands of DC bureaucrats. My therapy was at one of my hospitals (I had four) and every day I heard Medicaid patients being told their therapy visits were being cut off. Those CMS decisions are consigning people to wheelchairs, or worse.
Bobby Jindal weighs in:
Over the next few weeks, the Obama administration is set to dole out grants and begin to hire thousands of marketers to help sell ObamaCare. The Obama administration came up with a clever name for these marketers – ‘navigators’ – who are charged with helping to sign people up for ObamaCare.
‘Navigator’ is a crafty name, but in reality, there are very few restrictions on who they are, and what exactly they are supposed to be doing. ‘Navigators’ are supposed to be hired to help consumers understand the law and the insurance coverage provisions in the new health exchanges. Sounds like a job for a rocket scientist.
The ‘navigators’ are prohibited from having financial ties to an insurance company, but other than that there are few constraints. Union organizers and community activists are among the types that are allowed to be hired as ‘navigators’, and having prior experience working in the health care field doesn’t seem to necessarily be a pre-requisite for the job. I wonder what percentage of these ‘navigators’ will be partisan Democrats?
The ‘navigators’ will be required to take only 20 hours of online course training, which will apparently make them experts on the 1,000 page ObamaCare bill. An HHS official was even quoted this week saying, “We view training as an ongoing process.” Count me as skeptical.
To make matters worse, these ‘navigators’ are going to have access to all kinds of personal information that will make the whole program ripe for fraud. When helping individuals sign up for ObamaCare, these community organizers will have access to sensitive personal information, including social security numbers and tax information.
Amazingly, HHS is not planning on requiring background checks on these individuals before putting them to work. Besides the obvious identity theft concerns, this is a frightening development in light of the political activities and invasion of privacy, which the IRS and others have engaged in during the Obama presidency.
Don’t worry, it’s ready to go.
Though Oregon’s health insurance marketplace will launch Oct. 1 as planned, there’s one hitch. People will only be able to immediately purchase health insurance on it with certified insurance agents and “community partners.”
The online marketplace won’t be fully accessible until mid October – at the earliest.
The Affordable Care Act set in motion health insurance exchanges for people to buy health insurance, mandated by the federal changes which being next year. Oct. 1 has been the advertised day to start sign-ups.
Fears that the federal health care changes were too fast never stretched to Oregon, which started early setting up its online insurance marketplace, called Cover Oregon. However, state officials say the phased-in launch is just a matter of debugging the new website.
On Oct. 1, Cover Oregon will list agents and community partners who can walk individuals through the complicated new sign-up, the agency announced at its board meeting Thursday.
“We want to make sure we don’t overload the system and to make sure we quickly identify and resolve any bugs, but at the same time we want to open Oct. 1,” said Cover Oregon spokesperson Lisa Morawski.
In addition to working out kinks, Cover Oregon is also dealing with a $16 million shortfall. The Oregon Health Authority, a sister agency, had expected to fund computer programming for Cover Oregon through June with a $59 million federal grant. But documents show the grant ran out in April, due to a “misprojection” of remaining funds.
Cover Oregon picked up the bills, but to cover them, the agency hopes to win supplemental funding from the federal government. Without more money, the agency faces a major hit to staffing and its publicity campaign to inform people about the changes in health care coverage.
The specific date individuals will be able to buy insurance directly depends on any problems that emerge the first few weeks. Cover Oregon expects that to be mid-October.
SOURCE: Oregon Live
Fight over drug rebates:
A little-known provision of the 2010 health care law has states and their governors scrambling to take advantage of potential savings in how states distribute medication to Medicaid patients.
The Affordable Care Act (ACA) allows states to receive drug rebates even if they move their Medicaid prescription benefit to managed-care organizations. The federal government has also asked states to fix the wide disparities in dispensing costs for drugs distributed through Medicaid.
That has created a rush by states and businesses to capitalize on the changes as evidence shows they are having an effect. For the first time, New York has reduced Medicaid spending. Alabama, which had one of the highest dispensing rates for Medicaid drugs, has created a commission to determine the best way to distribute medication.
“It’s clearly been a trend over the last several years,” said Andrea Maresca, director of federal policy and strategy at the National Association of Medicaid Directors. “I think there’s money to be saved.”
The increase in spending for Medicaid, the federal-state health care program for low-income Americans, has bedeviled states for decades. Spending for medication was no different, and states have tried preferred-drug lists that point beneficiaries to cost-effective medications, requiring prior authorizations of drugs, requiring discounts from manufacturers, negotiating additional rebates and entering multistate joint-buying programs.
Although some approaches have succeeded in reducing costs, they have also created a patchwork in which states such as Alabama pay $11 per prescription to dispense Medicaid drugs but with low ingredient fees, while other states pay $2 in dispensing fees and higher costs for ingredients. Neither approach is transparent.
The battle for change now pits pharmaceutical manufacturers, pharmacy benefit managers and both physical and mail-order pharmacies against one another. They are lobbying state legislators around the country to encourage the use of certain medications, incentives and rebates. At the same time, drug costs have increased, and people are using more medications as they develop chronic diseases such as heart disease or diabetes.
SOURCE: USA Today
The latest from AEI:
First, we allow and encourage insurance companies to charge individualized premiums to consumers that reflect their true health care costs. This moves away from the current approach of offering coarse and relatively uniform premiums to the wide range of individuals seeking insurance (through the use of group insurance or state-level community-rating mandates). This reform provides a firm foundation for a health insurance market that no longer motivates healthy individuals to opt out. Insurance offerings would be made available in an open market – for example, through insurance exchanges – with premium transparency.
Second, to ensure that offers of insurance are affordable, we propose government-financed premium supports. The poor, especially the sick poor, gain access to a basic insurance plan at no cost and to more generous plans at significantly reduced costs.
Third, we propose eliminating the practical and legal barriers to multiyear (long-term) health insurance contracts. Such contracts protect all Americans from increases in insurance rates that could accompany major illness.
Fourth, we propose to abolish the tax preference for employer-sponsored health insurance plans. This subsidy encourages excess utilization of both insurance and low-value health care services. It also costs the federal government nearly $300 billion in lost revenue – revenue that could be used to fund insurance for the sick and the poor. Finally, it forces an awkward bundling of health care and employment with adverse consequences for workers and firms alike.
Our plan achieves universal coverage by ensuring that all individuals have access to a no-cost “basic plan.” It protects the poor and sick by targeting government funds toward subsidies for these groups. Federal and state governments will be able to specify in a transparent fashion the level of spending they wish to incur now and in the future, ensuring fiscal viability. The use of private health insurers allows choice for consumers and exploits the incentives of private firms to encourage the efficient use and pricing of health care services.
In sum, our plan will allow the United States to eliminate the separate and unequal nature of the present health care system that limits the health care access of poor Medicaid beneficiaries because of low reimbursements. All of this is accomplished within a framework that allows the market to do what it does best – pricing risk and controlling cost growth –and the government to do what it does best – ensuring a distribution of health care resources that is just and fair. In addition, the federal and state governments are provided with more flexibility to specify the current and future levels of spending they wish to allocate to the provision of health care.
SOURCE: American Enterprise Institute