Obama's Medicaid expansion keeps gaining ground under Trump

President Donald Trump is still trying to overturn “Obamacare,” but his predecessor's health care law keeps gaining ground in places where it was once unwelcome.

Missouri voters this week approved Medicaid expansion by a 53% to 47% margin, making the conservative state the seventh to do so under Trump. The Republican president readily carried Missouri in 2016, but the Medicaid vote comes as more people have been losing workplace health insurance in a treacherous coronavirus economy.

That leaves only a dozen states opposed to using the federal-state health program for low-income people as a vehicle for covering more adults, mainly people in jobs that don't provide health care. Medicaid expansion is a central feature of former President Barack Obama's Affordable Care Act, covering about 12 million people, while nearly 10 million others get subsidized private insurance.

If present trends continue, it's only a matter of time until all states expand Medicaid, acknowledged Brian Blase, a former health care adviser in the Trump White House, who remains opposed to the expansion.

“Medicaid expansion is terrible policy, but it is attractive to states because it's almost all federal spending and the insurance companies and hospitals get lots of dollars when a state expands Medicaid,” he said.

The federal government pays 90% of the cost of covering people through the expansion, a much higher matching share than for low-income disabled and elderly people traditionally covered by Medicaid. Blase argues that's an incentive to waste federal dollars. Before the ACA most low-income adults couldn't get Medicaid unless they were caring for children.

“There's lots of political pressure to expand,” said Blase. “Eventually all states are going to expand unless the enhanced (federal) match rate changes.”

Voters in another conservative state — Oklahoma — approved a Medicaid expansion earlier this year, although the margin was much closer than in Missouri. Of the seven states that have expanded Medicaid in the Trump years, six have done so by referendum, said Rachel Garfield, a senior policy expert with the nonpartisan Kaiser Family Foundation.

“This is an indication that there is large popular support for providing health care coverage for low-income people, and it is quite possible that this support has increased given what's going on with the pandemic,” Garfield said.

The six states where voters have approved Medicaid expansion in the Trump years are Idaho, Maine, Missouri, Nebraska, Oklahoma and Utah. In Virginia, the legislature passed a Medicaid expansion after Democrats made political gains.

“That has been an interesting feature of the Trump administration, that momentum among the states to expand Medicaid has not slowed down,” said Jesse Cross-Call, a policy expert with the Center on Budget and Policy Priorities, which advocates for low-income people.

Trump is trying to persuade the Supreme Court to toss out “Obamacare,” but as long as it remains the law his administration has to carry out expansions that states approve. Democratic presidential candidate Joe Biden would ask Congress to provide coverage where states have refused.

In Missouri, support for Medicaid expansion in cities and suburbs overcame opposition in rural communities. Supporters used the coronavirus pandemic to highlight the need for health care, especially in the wake of joblessness and loss of employer-provided insurance. The Missouri Chamber of Commerce and Industry, one of the state’s most influential business groups, also pushed for expansion as a way of helping the economy recover after COVID-19.

Cindy Mann, who ran Medicaid under Obama, argues that there's also a strong fairness argument for expansion. About 4.5 million poor adults live in states that have resisted expanding Medicaid. But because of the way the Obama health law is written, they don't qualify for subsidized private insurance through marketplaces like HealthCare.gov and they're stuck in a coverage gap.

“Those people have no access to coverage,” said Mann, now with the Manatt Health consultancy. “Those are a lot of the so-called essential workers, if we think about it through the COVID lens. It's a really inequitable story and one that increasingly can't be tolerated by the public.”

No other state referendum votes on Medicaid expansion are scheduled this political season. But Mann expects the debate will percolate through legislative elections in the 12 states, mainly in the South, that have refused. The biggest prizes are Texas, Florida and Georgia.

“Now they are surrounded by states that have expanded,” she said.

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Gnawing Away at Healthcare

Paul Krugman - May 7, 2018 - At the beginning of 2017, Republicans promised to release the kraken on Obamacare — to destroy the program with one devastating blow. But a funny thing happened: Voters realized that repealing the Affordable Care Act would mean taking health insurance away from tens of millions of Americans. They didn’t like that prospect — and enough Republicans balked at the backlash that Obamacare repeal fizzled.

But Republicans still hate the idea of helping Americans get health care. So instead of releasing the kraken, they’ve brought on the termites. Rather than trying to eliminate Obamacare in one fell swoop, they’re trying to undermine it with multiple acts of sabotage — while hoping voters won’t realize who’s responsible for rising premiums and falling coverage.

Which is why it’s important to place the blame where it belongs.

The first thing you need to understand is that Obamacare has been a highly successful program. 

When the legislation was passed, Republicans insisted it would fail to cut the number of uninsured and would blow a huge hole in the federal budget. In fact, it led to major gains in coverage, reducing the uninsured rate to its lowest level in history, at relatively low cost.

It’s true that the coverage expansion was somewhat less than originally predicted, although the shortfall was much less than you may have heard. It’s also true that after initially offering surprisingly cheap policies on the Obamacare exchanges, insurers found that the people signing up were sicker, on average, than they expected, leading to higher premiums. But as of last year, the markets appeared to have stabilized, with insurers generally profitable.

Nobody would claim that Obamacare is perfect; many Americans remain uninsured, and too many of those with coverage face troublingly high out-of-pocket expenses. Still, health reform delivered most of what its advocates promised and caused none of the disasters its opponents predicted.

Yet Republicans still want to destroy it. One reason is that much of the coverage expansion was paid for with taxes on high incomes, so repeal would be a way to cut taxes on the wealthy. More broadly, conservatives hate Obamacare precisely because it works. It shows that government actually can help tens of millions of Americans lead better, more secure lives, and in so doing it threatens their low-tax, small-government ideology.

But outright repeal failed, so now it’s time for sabotage, which is taking place on two main fronts.

One of these fronts involves the expansion of Medicaid, which probably accounted for more than half the gains in coverage under Obamacare. Now a number of Republican-controlled states are trying to make Medicaid harder to get, notably by imposing work requirements on recipients.

What is the point of these work requirements? The ostensible justification — cracking down on able-bodied Medicaid recipients who should be working but aren’t — is nonsense: There are very few people meeting that description. The real goal is simply to make getting health care harder, by imposing onerous reporting and paperwork requirements and punishing people who lose their jobs for reasons beyond their control.

The other front involves trying to reduce the number of people signing up for private coverage. Last year the Trump administration drastically reduced outreach — the effort to let Americans know when and how to get health insurance.

The administration is also promoting various dodges that would in effect let insurance companies go back to discriminating against people in poor health. And when Congress passed a huge tax cut for corporations and the wealthy, it also eliminated the individual mandate, the requirement that people sign up for insurance even if they’re currently healthy.

Preliminary evidence suggests that these efforts at sabotage have already partially reversed the coverage gains achieved under Obama, especially among lower-income Americans. (Curiously, all the coverage losses seem to have happened among self-identified Republicans.) But the worst is yet to come.

You see, G.O.P. sabotage disproportionately discourages young and healthy people from signing up, which, as one commentator put it, “drives up the cost for other folks within that market.” Who said that? Tom Price, President Trump’s first secretary of health and human services.

Sure enough, insurers are already proposing major premium hikes — and they are specifically attributing those hikes to G.O.P. actions that are driving healthy Americans out of the market, leaving a sicker, more expensive pool behind.

So here’s what’s going to happen: Soon, many Americans will suffer sticker shock from their insurance policies; federal subsidies will protect most of them, but by no means everyone. They’ll also hear news about declining insurance coverage. And Republicans will say, “See, Obamacare is failing.”

But the problem isn’t with Obamacare, it’s with the politicians who unleashed this termite infestation — who are doing all they can to take away your health coverage. And they need to be held accountable.

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Idaho Insurer Moves Ahead With Health Plans That Flout Federal Rules

It's barely been two weeks since Idaho regulators said they would allow the sale of health insurance that doesn't meet all of the Affordable Care Act's requirements — a controversial step some experts said would likely draw legal scrutiny and, potentially, federal fines for any insurer that jumped in.
And on Wednesday, Blue Cross of Idaho unveiled a menu of new health plans that break with federal health law rules in several ways, including setting premiums based on applicants' health.

"We're trying to offer a choice that allows the middle class to get back into insurance coverage," said Dave Jeppesen, the insurer's executive vice president for consumer health care.

The insurer filed five plans to the state for approval and hopes to start selling them as soon as next month.

The Blue Cross decision ups the ante for Alex Azar, the Trump administration's new Health and Human Services secretary. Will he use his authority under federal law to compel Idaho to follow the ACA and reject the Blues plans? Or will he allow state regulators to move forward, perhaps prompting other states to take more sweeping actions?

At a congressional hearing Wednesday, even as Blue Cross rolled out its plans, Azar faced such questions. "There are rules," Azar said. "There is a rule of law that we need to enforce."

However, he didn't specifically indicate whether the federal government would step in.

Robert Laszewski, a consultant and former insurance industry executive, says it should. "If Idaho is able to do this, it will mean other ... states will do the same thing," he said. "If a state can ignore federal law on this, it can ignore federal law on everything."

Idaho's move stirs up more issues about the stability of individual insurance markets.

Policy analysts say that allowing lower-cost plans that don't meet the ACA's standards to become more widespread will pull younger and healthier people out of Obamacare, raising prices for those who remain. Supporters say that is already happening, so the lower-cost plans provide more choices for people who earn too much to qualify for subsidies to help them purchase ACA coverage.

Idaho's move to allow such plans, announced in January, drew harsh and swift criticism.

"Crazypants illegal," tweeted Nicholas Bagley, a law professor at the University of Michigan and former attorney with the civil division of the U.S. Department of Justice, who said that states can't pick and choose which parts of federal law to follow. Sabrina Corlette, a research professor at Georgetown University's Center on Health Insurance Reforms, pointed out that health insurers could be liable for sharp fines if they are found to be in violation of the ACA.

But both Idaho regulators and Blue Cross officials say they aren't worried.

Jeppesen said the ACA gives states regulatory authority "to make sure the market works and is stable," and the insurer is simply "following what the state has given us guidance" to do.

Other insurers in Idaho are taking a much more cautious approach, telling The Wall Street Journal they aren't stepping up immediately to offer their own plans.

Laszewski said they are likely waiting to see what legal challenges develop. "If I were running an insurance company, there's no way I would stick my neck out until the high court has ruled in favor of this — and they're not going to," he said.

Jeppesen said his company has consulted with legal experts and is moving ahead with confidence.

The aim is to bring people back into the market, particularly the young, the healthy and those who don't get a tax credit subsidy and can't afford an ACA plan.

For some people — especially younger or healthier applicants — the new plans, which the insurer has named Freedom Blue, cost less per month than policies that meet all ACA rules.

They accomplish that by limiting coverage. If they are allowed to be sold, consumers will need to weigh the lower premiums against some of the coverage restrictions and variable premiums and deductibles, policy experts say.

The plans, for example, will include a "waiting period" of up to 12 months for any pre-existing conditions if the applicant has been without coverage for more than 63 days, Jeppesen said.

Additionally, they cap total medical care coverage at $1 million annually. And premiums are based, in part, on a person's health: The healthiest consumers get rates 50 percent below standard levels, while those deemed unhealthy would be charged 50 percent more.

All those conditions violate ACA rules, which forbid insurers from rejecting coverage of preexisting conditions or setting dollar caps on benefits or higher premiums for people with health problems.

But the rates may prove attractive to some.

Premiums for a healthy 45-year-old, for example, could be as low as $195 a month, according to a comparison issued by the insurer, while a 45-year-old with health problems could be charged $526. In that case, the 45-year old would find a lower price tag — $343 a month — for an ACA-compliant bronze plan.

While Freedom Blues plans cover many of the "essential health benefits" required under the ACA, such as hospitalization, emergency care and mental health treatment, they do not include pediatric dental or vision coverage. One of the five plans doesn't include maternity coverage.

When compared with one of the Blues' ACA-compliant plans — called the Bronze 5500 — the new standard Freedom Blue plan's annual deductibles are a mixed bag.

That's because it has two separate deductibles — one for medical care and one for drugs. If a consumer took only generic drugs, the new plan would be less expensive, according to details provided by the plan. But with a $4,000 deductible for brand-name drugs, the Freedom Blue plan requires more upfront money before full coverage kicks in than the ACA-compliant plan it was compared with.

Jeppesen said the insurer hopes to attract many of the "110,000 uninsured state residents who cannot afford [ACA] coverage."

That's the total number of uninsured people who earn more than 100 percent of the federal poverty level in the state, he said.

Sarah Lueck, senior policy analyst for the Center on Budget and Policy Priorities, cautioned that some of those residents might actually be eligible for subsidies under the ACA, which are available to people earning up to four times as much.

"Many ... could be getting subsidies for more comprehensive coverage through the [ACA-compliant state exchange] and would be better off," Lueck said.

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Republicans' Proposed Medicaid Cuts Would Hit Rural Patients Hard

For the hundreds of rural U.S. hospitals struggling to stay in business, health policy decisions made in Washington, D.C., this summer could make survival a lot tougher.

Since 2010, at least 79 rural hospitals have closed across the country, and nearly 700 more are at risk of closing. These hospitals serve a largely older, poorer and sicker population than most hospitals, making them particularly vulnerable to changes made to Medicaid funding.

"A lot of hospitals like [ours] could get hurt," says Kerry Noble, CEO of Pemiscot Memorial Health Systems, which runs the public hospital in Pemiscot County, one of the poorest in Missouri.

The GOP's American Health Care Act would cut Medicaid — the public insurance program for many low-income families, children and elderly Americans, as well as people with disabilities — by as much as $834 billion. The Congressional Budget Office has said that would result in 23 million more people being uninsured in the next 10 years. Even more could lose coverage under the budget proposed by President Trump, which suggests an additional $610 billion in cuts to the program.

That is a problem for small rural hospitals like Pemiscot Memorial, which depend on Medicaid. The hospital serves an agricultural county that ranks worst in Missouri for most health indicators, including premature deaths, quality of life and even adult smoking rates. Closing the county's hospital could make those much worse.

And a rural hospital closure goes beyond people losing health care. Jobs, property values and even schools can suffer. Pemiscot County already has the state's highest unemployment rate. Losing the hospital would mean losing the county's largest employer.

"It would be devastating economically," Noble says. "Our annual payrolls are around $20 million a year."

All of that weighs on Noble's mind when he ponders the hospital's future. Pemiscot's story is a lesson in how decisions made by state and federal lawmakers have put these small hospitals on the edge of collapse.

Back in 2005, things were very different. The hospital was doing well, and Noble commissioned a $16 million plan to completely overhaul the facility, which was built in 1951.

"We were going to pay for the first phase of that in cash. We didn't even need to borrow any money for it," Noble says while thumbing through the old blueprints in his office at the hospital.

But those renovations never happened. In 2005, the Missouri legislature passed sweeping cuts to Medicaid. More than 100,000 Missourians lost their health coverage, and this had an immediate impact on Pemiscot Memorial's bottom line. About 40 percent of their patients were enrolled in Medicaid at the time, and nearly half of them lost their insurance in the cuts.

Those now-uninsured patients still needed care, though, and as a public hospital, Pemiscot Memorial had to take them in.

"So we're still providing care, but we're no longer being compensated," Noble says.

And as the cost of treating the uninsured went up, the hospital's already slim margins shrunk. The hospital went into survival mode.

The Affordable Care Act was supposed to help with the problem of uncompensated care. It offered rural hospitals a potential lifeline by giving states the option to expand Medicaid to a larger segment of their populations. In Missouri, that would have covered about 300,000 people.

"It was the fundamental building block [of the ACA] that was supposed to cover low-income Americans," says Sidney Watson, a St. Louis University health law professor.

In Missouri, Kerry Noble and Pemiscot Memorial became the poster children for Medicaid expansion. In 2013, Noble went to the state capital to make the case for expansion on behalf of the hospital.

"Our facility will no longer be in existence if this expansion does not occur," Noble told a crowd at a press conference.

"Medicaid cuts are always hard to rural hospitals," Watson says. "People have less employer-sponsored coverage in rural areas and people are relying more on Medicaid and on Medicare."
But the Missouri legislature voted against expansion.

For now, the doors of Pemiscot Memorial are still open. The hospital has cut some costly programs — like obstetrics — outsourced its ambulance service and has skipped upgrades.

"People might look at us and say, 'See, you didn't need Medicaid expansion. You're still there,' " Noble says. "But how long are we going to be here if we don't get some relief?"

Relief for rural hospitals is not what is being debated in Washington right now. Under the GOP House plan, even states like Missouri that did not expand Medicaid could see tens of thousands of residents losing their Medicaid coverage.

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Health Insurance Industry Supports GOP Attempt to Repeal Obamacare Protections

After several failed attempts, President Trump and the Republican-controlled House of Representatives narrowly passed legislation known as the American Health Care Act to repeal and replace President Obama’s signature Affordable Care Act, or Obamacare. The measure, which carried by a 217 to 213 vote, was rushed through the House on May 4 before the Congressional Budget Office could score the bill to assess its cost and impact on national healthcare. But a previous CBO evaluation on a less severe version of the bill found that at least 24 million Americans would lose their health insurance coverage if the AHCA were ever signed into law.

Negotiations with the GOP’s right-wing “House Freedom Caucus” faction secured sufficient votes for passage, but their members extracted concessions that undoubtedly will make the bill even less popular than the previously debated version. Key provisions include the loss of protections for those with pre-existing conditions, mandated employer insurance plans are now in jeopardy, Medicaid expansion is ended with an $800 billion budget cut, Planned Parenthood is defunded and the wealthiest Americans receive a $765 billion tax cut over 10 years.

The AHCA bill now moves to the U.S. Senate, where many Republicans open criticized the measure, and say they’ll draft new reform legislation from scratch, which then must be sent back to the House. Between The Lines’ Scott Harris spoke with Wendell Potter, a former health insurance industry executive and whistleblower. Here, he assesses the provisions in the GOP House bill, prospects for action in the U.S. Senate, and the role of the insurance industry in eroding key benefits in the ACA.

WENDELL POTTER: It is awful, awful legislation. It is about some of the worst I've ever seen and it is something that would take us back to what life was like for many people before the Affordable Care Act was passed. In fact, make it worse. It's estimated that at least almost 25 million people would lose their health insurance. Just as bad, a lot of people who have pre-existing conditions – and quite frankly, that is almost a majority of us these days – would face higher premiums and in some cases, wouldn't be able to afford coverage at all. It would allow insurance companies essentially to do what they used to do, which is to declare some uninsurable. Blackball them and not enable people to get not only the insurance they need, but access to care that they need. In so many ways, it would put the insurance industry much more in the driver's seat once again, of our health care system than they already are. And would lift and engage some of the most egregious practices that needed to end.

BETWEEN THE LINES: Wendell, the insurance industry in the United States helped write the Affordable Care Act, Obamacare. And they reaped a lot of profits because of the expanded pool of customers for their insurance with the subsidies that came online and all that. What was the role as you understand it, of the insurance industry in working with Republicans on this piece of legislation that has passed the House of Representatives. It's not law yet, it still needs to go through the Senate and back to the House. There's a whole long process ahead.

WENDELL POTTER: You're exactly right. The insurance companies have done very very well since the Affordable Care Act went into effect. They've been reporting record profits. So they've done well. But what they don't like is that can't engage in some of these practices that they once did. They think that there's a chance they might even be more profitable if they got rid of some of these restrictions on them. They would like to go back to the time when they could pick and choose who to insure so that they could weed out people who really need coverage. And definitely, they're working behind the scenes to help lawmakers' message, if you will, what they're trying to do here in ways that they think can be sold to the American public, but they're selling them a bill a goods.

On the other hand, the insurance companies don't like that the Republicans would change the Medicaid program to what's essentially referred to as a block grant program. In other words, the federal program just would provide a certain amount of money to the states. The effect would be to reduce the Medicaid payments almost a trillion dollars over the next several years. Insurance companies don't like that because many states have largely turned over their Medicaid programs to insurance companies. So insurance companies would see a significant decline in revenues if that part of the bill goes through.

BETWEEN THE LINES: There are many listeners who have heard about a universal single-payer health care bill that's going through the California legislature. And I'm wondering if you think there's a chance that we could see an example of universal health care in one of our largest states – California – that could be an example for the federal system much in the way that Saskatchewan, a province in Canada, was the first to adopt a universal single-payer system in that country, in Canada and was later adopted by the federal government in Ottawa. 

WENDELL POTTER: I think it's entirely possible. And there is strong support for single-payer healthcare in California, and also in Oregon and Washington, too. And other states. California would be especially significant if it were to pass a single-payer bill. There is a bill that is before the California legislature now that has been introduced that would create a single-payer system. It may not get approved this year, but there is strong support for it, growing support for it. And I think what you're going to see is that business leaders are going to wake up and start embracing this. And business leaders in particular are, I think, waking up to understanding that a multi-payer system in which we have all these insurance companies that really cannot control cost and that add cost to the system – it just doesn't make sense for them or the country. Health care for those employers that provide coverage – it's an expense they can't predict year after year, and like I said, insurance companies are demonstrating that they cannot control health care costs. And I think the gig is up for them, or will be in a few years because employers who are very politically active I think may be ultimately, be the death knell for the system that we have now.

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GOP Plan To Trim Insurance Benefits Might Not Tame Premiums

As House Republicans try to find common cause on a bill to repeal and replace the Affordable Care Act, they may be ready to let states make the ultimate decision about whether to keep a key provision in the federal health law that conservatives believe is raising insurance costs.

Conservatives from the House Freedom Caucus and members of a more moderate group of House Republicans, the Tuesday Group, are working on changes to the GOP health overhaul bill that was pulled unceremoniously by party leaders last month when they couldn't get enough votes to pass it.

At the heart of those negotiations is the law's requirement that most insurance plans offer 10 specific categories of "essential health benefits." They include hospital care, doctor and outpatient visits and prescription drug coverage, along with things like maternity care, mental health and preventive care services.

The Freedom Caucus had been pushing to strip required benefits, arguing that the coverage guarantees were driving up premium prices.

"We ultimately will be judged by only one factor: if insurance premiums come down," the Freedom Caucus chairman, Rep. Mark Meadows, R-N.C., told The Heritage Foundation's Daily Signal last month.

But moderates, bolstered by complaints from patient groups and constituents, fought back. And a brief synopsis of a proposal outlined by Rep. Tom MacArthur, R-N.J., suggests that the compromise could be letting states decide whether they want a federal waiver to delete essential health benefits.
"The insurance mandates are a primary driver of [premium] spikes," Meadows and Sen. Ted Cruz, R-Texas, wrote in March.

But health analysts and economists say that eliminating those benefits probably won't bring premiums down — at least not in the way conservatives are hoping.

"I don't know what they're thinking they're going to pull out of this pie," says Rebekah Bayram, a principal consulting actuary at the benefits consulting firm Milliman. She is the lead author of a recent study on the cost of various health benefits.

Opponents of the required benefits point to coverage for maternity care and mental health and substance abuse treatment as things that drive up premiums for people who will never use such services.

But eliminating those benefits wouldn't have much of an impact, Bayram says. Hospital care, doctor visits and prescription drugs "are the three big ones," she says. "Unless they were talking about ditching those, the other ones only have a marginal impact."

John Bertko, an actuary who worked in the Obama administration and served on the board of Massachusetts' health exchange, agrees: "You would either have very crappy benefits without drugs or physicians or hospitalization, or you would have roughly the same costs."

Maternity care and mental health and substance abuse, he says, "are probably less than 5 percent" of premium costs.

Of course, requiring specific coverage does push up premiums to some extent. James Bailey, an assistant professor of health economics at Creighton University in Omaha, has studied the issue at the state level. He estimates that the average state health insurance mandate "raises premiums by about one-half of 1 percent."

Those who want to get rid of the required benefits point to the fact that premiums in the individual market jumped dramatically from 2013 to 2014, the first year the benefits were required.

"The ACA requires more benefits that every consumer is required to purchase regardless of whether they want them, need them or can afford them," Ohio Insurance Commissioner Mary Taylor said in 2013, when the state's rates were announced.

But most of that jump was not due to the broader benefits, Bayram says, but to the fact that for the first time sicker patients were allowed to buy coverage.

"The premiums would go down a lot if only very healthy people were covered and people who were higher risk were pulled out of the risk pool," she says. (Some conservatives want to change that requirement, too, and let insurers charge sick people higher premiums.)

Meanwhile, most of the research that has been done on required benefits has looked at plans offered to workers by their employers, not policies available to individuals who buy their own coverage because they don't get it through work or the government. That individual market is the focus of the current debate.

Analysts warn that individual-market dynamics differ greatly from those of the employer insurance market.

Bailey says he "saw this debate coming and wanted to write a paper" about the ACA's essential health benefits. But "I very quickly realized there are all these complicated details that are going to make it very hard to figure out," he says, particularly the way the required benefits work in tandem with other requirements in the law.

For example, says Bertko, prescription drugs can represent 20 percent of costs in the individual market. That's far more than in the employer market.

Another big complication is that the required benefits do double duty, Bayram says. They not only ensure that consumers have a comprehensive package of benefits, but enable other parts of the health law to work by ensuring that everyone's benefits are comparable.

For example, the law adjusts payments to insurers to help compensate plans that enroll sicker-than-average patients. But in order to do that risk adjustment, she says, "all of the plans have to agree on some kind of package. So if you think of essential health benefits as an agreed-upon benchmark, I don't know how they can get rid of that and still have risk adjustment."

Kaiser Health News (KHN) is a national health policy news service. It is an editorially independent program of the Henry J. Kaiser Family Foundation.

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ACA individual insurance market is improving, but still fragile

Despite claims from President Donald Trump and other Congressional Republican leaders that the Affordable Care Act's individual insurance market is in a “death spiral,” that market is actually improving, according to one analysis.

Ratings firm S&P Global looked at the financial performance of 32 Blue Cross and Blue Shield companies that have sold coverage in the individual insurance market since the ACA took effect in 2014.

It found that the medical-loss ratio, which represents the amount of collected premiums spent on medical claims, improved significantly in 2016 for most Blues insurers, which have struggled with the market in the first couple of years. Last year, insurance premiums exceeded medical care costs for the majority of the Blues plans studied.

“We are seeing the first signs in 2016 that this market could be manageable for most health insurers,” the report stated.

Barring any major legislative changes, S&P analysts predict many of the Blues plans will get close to breaking even in their individual market business this year, and more will record a profit in 2018. But that could change if the Trump administration makes any major legislative changes to the healthcare law.

“The market is still fragile,” said Deep Banerjee, S&P analyst and lead author of the report.

The findings are good news for a market that has been plagued with negative headlines and enrollment declines.

Enrollment in the ACA's exchanges fell to 12.2 million in 2017 from 12.7 million the year before. Premiums rose by double-digits on average in 2017. Health insurers have threatened stop selling insurance plans in the individual market next year without a sign that it will stabilize and become profitable soon.

Some have already pulled the plug: Aetna, UnitedHealth Group and Humana, have exited or scaled back their participation in the individual insurance market. And last week, two of Iowa's largest insurers—Wellmark Blue Cross and Blue Shield and Aetna—announced they will no longer offer ACA-compliant individual coverage in the state in 2018, citing financial losses and uncertainty about future insurance regulations.

But many of the Blues insurers have stuck around. They slowly figured out the market, adjusted insurance premiums and tweaked provider networks.

And now they are seeing results: According to the report, the weighted average medical loss ratio, or MLR, for the Blues plans studied was 92% in 2016, down from 106% in 2015 and 102% in 2014. That means for the first time since 2014, the plans collected more money in premiums than they spent on medical claims in 2016.

But while the “individual market is not in a 'death spiral,' it isn't on stable footing either,” the S&P report said.

The Trump administration has yet to address insurers' most pressing concerns about the availability of cost-sharing reductions and the enforcement of the mandate that consumers purchase coverage. The S&P report also notes that enforcement of the ACA's special enrollment periods and enrollment outreach are crucial to the stability of the market.

“If insurers are uneasy regarding the future of the market, they may have to decide between adding an "uncertainty buffer" to their pricing or--worst case--exiting the exchanges altogether,” the S&P report said.

 

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Insurers deceive public, former insider says

A New York Times best-selling author, renowned journalist and health insurance insider visited the College to discuss the past and future of health care and its affects on March 21.

“How many of you have ever said the Affordable Care Act, better known as Obamacare, was a government takeover of health care?” Wendell Potter asked a crowd of students and faculty in room 212 of the Education Building.

Potter revealed that story was a fabrication by insurance companies.

“Tens of millions believed it, and millions of us still do,” Potter said. “Well, guess what? It was nowhere close to the truth. It was, and still is, fake news. And I was partly responsible for spreading it.”

Upon returning to his journalism career, Potter served as vice president of corporate communications for a leading health insurance group, Cigna. There, he helped create and implement Cigna’s many public relations campaigns that were designed to “make you think, act and vote in ways the (insurance companies) wanted you to.” It all started 10 years ago on the 16th floor of One Liberty Place in Philadelphia, where Potter had a secret meeting with his former employer, Cigna, and several other top PR executives from health insurance companies. 

Ten days before the meeting, director Michael Moore premiered his documentary “Sicko” in France, which exposed how poorly the U.S. health care system fared compared to other countries. 

“‘Sicko’ was not about the growing number of uninsured Americans, but was about people who had insurance and still couldn’t afford to get the care they needed,” Potter said. 

The secret meeting was arranged because Americans’ attitudes toward health care were shifting negatively. 

Pollster Bill McInturff presented at the meeting a recent national poll he conducted providing evidence that Americans doubted private insurance companies. 

“The poll showed that the government should do more to solve the many problems that plagued the American health care system,” Potter said. 

Mike Tuffin of America’s Health Insurance Plan and Robert Schooling of the Washington PR firm APCO Worldwide flew to Philadelphia to “discredit (‘Sicko’) and the movie maker,” Potter said.

Potter said APCO was a master of deception, and it discussed in a 1995 pamphlet “how the firm helped corporations advance their goals by influencing lawmakers, drafting legislation, regulations and creating business correlations tailored to specific issues.” 

AHIP and APCO created an impressive PR strategy that would shift the media’s focus away from Moore and position the insurance companies as part of the solution rather than the problem, according to Potter. 

The front group created by APCO would be called “Health Care America” and would lead the effort in changing American minds after the release of “Sicko” in the U.S.

The money for Health Care America came from the pockets of Americans paying their insurance premiums. Due to the immense outcome of this strategic campaign, Moore’s film did not do as well as anticipated, according to Potter. 

“Not a single reporter had done enough investigative work to find out that the insurance industry was behind it all. We fooled everybody,” Potter said. 

But what does this have to do with today? Everything, according to Potter. 

Using a similar campaign strategy used against “Sicko,” health care insurance groups would once again influence the debate of the Affordable Care Act — now known as Obamacare. 

The companies denounced the health care reform legislation, promoting it as a “government takeover of health care,” he said. 

Potter said millions of people believed it, but, in fact, Obamacare “solidified the role private insurance companies play in our health care system.” 

According to Potter, Obamacare forced insurance companies to become more consumer focused. 
 

“The industry has really thrived over the past eight years,” Potter said. “The share price of the biggest insurance company, UnitedHealthcare, has increased a stunning 1,000 percent since the early days of the Obama administration.” 

Compared to the insurance companies, the pharmaceutical companies spent “$275 million to lobby Congress and the White House in 2009.” 

Potter said that according to the Center of Responsive Politics, it’s the most money spent on lobbying in a single year. Compared to other countries, American’s pay more for prescription medications. 

Millions of people to this day still believe that Obamacare is a government takeover, but it has, instead, made a positive difference in the lives of the American people, according to Potter. 

The new administration is repealing and replacing Obamacare for what is now introduced as the American Health Care Act. Many groups, including the American Medical Association, American Hospital Association and AARP, have come out against the new health care system, Potter said.

Although these industries are being overt, the insurance companies are silent. 

Potter believed that was because they were working behind the scenes to get the new health care bill passed, which would allow them to make more money. 

Before Obamacare was passed, Potter said many insurance companies sold “junk” insurance with spotty coverage “because it was very profitable and they would like to be able to sell it again. With the current reform debate in Washington, insurance companies smell an opportunity to get rid of those pesky new rules.” 

If the new bill was passed, insurance companies would be able to sell sky-high policies with skimpy benefits, according to Potter. 

“Even if the American health care act passes the house this week, the chances of it getting through the Senate in its current configuration are pretty slim,” Potter said. 

This is because many people on both sides of the aisle believe it would not benefit low- and middle-class families. 

Potter’s prediction never had a chance to come to fruition. Speaker of the House Paul Ryan pulled the bill before it had a chance to pass in the House of Representatives on Saturday, March 25, according to CNN.

Potter said there isn’t a reason to expect much progress at the moment. The only way he can foresee progress is if the American people become “better informed and well-engaged citizens,” which he hopes can be achieved through the launch of his new site, Tarbell.org.

Named after investigative journalist Ida Tarbell, Potter hopes to point out to solutions in changing the way we perceive health care.

“Despite everything I said today, I am hopeful we can create the world’s best health care system,” Potter said.

His latest book, “Nation on the Take: How Big Money Corrupts Our Democracy and What we can do About it,” emphasizes how Americans can take a stand.

“We need to work together to be sure it’s disrupted in our favor and not just Wall Street’s,” Potter said. 

Potter believes coming together is the key to reforming America’s health care system.

“I’m convinced that when we come together and work across party lines — which can happen and is happening in places around the country — we can bring costs under control,” Potter said. “We can make certain that every one of us has access to quality care we can afford.”

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President Obama's memo on the eve of Republican vote to repeal and replace Obamacare

"When I took office, millions of Americans were locked out of our health care system. So, just as leaders in both parties had tried to do since the days of Teddy Roosevelt, we took up the cause of health reform. It was a long battle, carried out in Congressional hearings and in the public square for more than a year. But ultimately, after a century of talk, decades of trying, and a year of bipartisan debate, our generation was the one that succeeded. We finally declared that in America, health care is not a privilege for a few, but a right for everybody.

The result was the Affordable Care Act, which I signed into law seven years ago today. Thanks to this law, more than twenty million Americans have gained the security and peace of mind of health insurance. Thanks to this law, more than ninety percent of Americans are insured – the highest rate in our history. Thanks to this law, the days when women could be charged more than men and Americans with pre-existing conditions could be denied coverage altogether are relics of the past. Seniors have bigger discounts on their prescription drugs. Young people can stay on their parents’ plans until they turn 26 years old. And Americans who already had insurance received an upgrade as well – from free preventive care, like mammograms and vaccines, to improvements in the quality of care in hospitals that has averted nearly 100,000 deaths so far.

All of that is thanks to the Affordable Care Act. And all the while, since the law passed, the pace of health care inflation has slowed dramatically. Prices are still rising, just as they have every year for decades – but under this law, they’ve been rising at the slowest rate in fifty years. Families who get coverage through their employer are paying, on average, thousands of dollars less per year than if costs kept rising as fast as they were before the law. And reality continues to discredit the false claim that this law is in a “death spiral,” because while it's true that some premiums have risen, the vast majority of Marketplace enrollees have experienced no average premium hike at all. And so long as the law is properly administered, this market will remain stable. Likewise, this law is no “job-killer,” because America’s businesses went on a record-breaking streak of job growth in the seven years since I signed it.

So the reality is clear: America is stronger because of the Affordable Care Act. There will always be work to do to reduce costs, stabilize markets, improve quality, and help the millions of Americans who remain uninsured in states that have so far refused to expand Medicaid. I’ve always said we should build on this law, just as Americans of both parties worked to improve Social Security, Medicare, and Medicaid over the years. So if Republicans are serious about lowering costs while expanding coverage to those who need it, and if they’re prepared to work with Democrats and objective evaluators in finding solutions that accomplish those goals – that’s something we all should welcome. But we should start from the baseline that any changes will make our health care system better, not worse for hardworking Americans. That should always be our priority.

The Affordable Care Act is law only because millions of Americans mobilized, and organized, and decided that this fight was about more than health care – it was about the character of our country. It was about whether the wealthiest nation on Earth would make sure that neither illness nor twist of fate would rob us of everything we’ve worked so hard to build. It was about whether we look out for one another, as neighbors, and fellow citizens, who care about each other’s success. This fight is still about all that today. And Americans who love their country still have the power to change it."

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Obamacare Repeal Is Failing Because It Was Based on a Lie

With Trump in office, Obamacare is becoming more popular. Photo: Pacific Press/LightRocket via Getty Images

Last week, Richard Hanna, a Republican from central New York who just retired from Congress, admitted something that almost no member of his party in elected office has been willing to concede in public. “At the end of the day, the Affordable Care Act will in some form survive, and the millions of people who are on it will have insurance,” he said. “It’s something this country needed and something people want. Politically, it’s untenable to just wipe it away. So who really won? In my argument, the president, Obama, won. At the end of the day we will have some sort of national health care that’s going to look very similar to what we have.” The mania for destroying the law is faltering because the Republican crusade to kill Obamacare was always based on delusions that are no longer possible to conceal.

In the aftermath of the presidential election that handed them full control of government, Republicans quickly converged on a plan to execute their longtime battle cry of repealing Obamacare: They would immediately repeal the law, perhaps even signing the bill to do it on Inauguration Day, after which they would have leverage over shattered Democrats to force the opposition party to supply votes to pass whatever the majority came up with. Since that point, they have moved steadily backward.

In early January, several Senate Republicans indicated opposition to repealing Obamacare without a replacement — enough defections to kill repeal, given that the party can only lose two Senate votes. The plan to quickly repeal, and then figure out a replacement, appears to have been halted, and the party has yet to decide what will take its place. A week after the inauguration, a secret recording of a Republican Congressional brainstorming session revealed the party had not advanced beyond step one in conceptualizing a plan, let alone achieving consensus on any of the numerous dilemmas they would need to resolve. “We’re in the information-gathering mode right now,” says Representative Mark Meadows. At the current trajectory, sometime next week, a Republican staffer will Google “What is health care?”

In an interview Sunday with Bill O’Reilly, President Trump conceded that health care was “very complicated,” and floated a timetable for devising a replacement that could extend into next year:

Yes, in the process and maybe it’ll take till sometime into next year, but we’re certainly going to be in the process. Very complicated — Obamacare is a disaster. You have to remember Obamacare doesn’t work, so we are putting in a wonderful plan. It statutorily takes a while to get. We’re going to be putting it in fairly soon. I think that, yes, I would like to say by the end of the year, at least the rudiments, but we should have something within the year and the following year.

While Trump is known to be an unreliable narrator of his own administration’s policy, the climbdown from his characteristic boasting of rapid victory is nonetheless striking. He seems to have absorbed from his advisers the difficulty of the situation and the need to reel back expectations.

As the Republicans continue their long retreat, they are encountering every false premise that brought them to this point. The most important of these is a misconception about Obamacare’s popularity. For most of the time since 2010, polls have showed negative approval for the law, the single fact that conservatives have leaned on most heavily since 2010. Of the countless polemics against the Affordable Care Act that have appeared since 2010, the law’s mediocre approval ratings are the data points conservatives invoke more than any other. It is the foundation for their belief the law is corrupt and was passed illegitimately, that the public shares the GOP’s root-and-branch rejection of its very design, and that Republicans have a mandate to repeal it.

  

Supporters of the law have had a different explanation for its poor approval ratings. People have very little information about what the law does, and even many people who benefit from it are not aware. 

  

The long, tortured negotiations required to pass the law did not prove the process was corrupt or failed, but that health-care reform is intrinsically difficult. People will fight much harder to avoid losing a benefit they have — even if that benefit is not actually at risk — than to create a new one they don’t. Proponents of health-care reform always believed that bringing health care into reality would make it much easier to defend.

 That has turned out to be correct. The law’s growing popularity can be seen across several dimensions. Repealing Obamacare first, without a replacement, is wildly unpopular, drawing 20 percent approval or less. Repealing the law and starting over with a new one — the Republican position since 2010 — draws support from one-third of the public, while keeping Obamacare and fixing it gets nearly twice as much support. On the straightforward question of whether Barack Obama’s health-care reform was a good idea or a bad one, for the first time ever, “good idea” now wins:

And Americans by a significant margin believe it is the government’s responsibility to make sure everybody has coverage:

The chart above is especially telling. Notice that a huge majority agreed that the government should cover everybody before and after Obama’s presidency, but that support collapsed during the time of an administration attempting to implement this goal. Political scientists have long recognized that public opinion has a thermostatic element, demanding more government services during Republican presidencies, and less during Democratic ones. It is striking how fast public opinion has swung — this is even before Republicans have begun to publicly debate an alternative plan, which would contain all sorts of unpopular specific elements that would drive down its support even farther.

  

Republicans suffer from an additional handicap that Democrats did not face in 2010: they are not merely over-promising what they can deliver, they are promising the exact opposite. While GOP rhetoric has lambasted the cost of plans offered by Obamacare, their alternatives would all impose even higher costs. An extended public debate over actual, filled-out Republican plans that force people onto catastrophic plans that do not cover basic medical expenses would be a political debacle.

It is not only majority opinion that is swinging against Republicans on health care. Lobbyists, too, tend to organize against change. Hospitals are demanding that Republicans either keep covering the Americans who have insurance through Obamacare, or else compensate the hospitals for the losses they would suffer from facing millions of customers who can longer pay for their care. AARP has staked out opposition to one of the GOP’s favorite proposals to tweak Obamacare, which would allow insurers to charge even higher rates to older customers. Obamacare only permits insurers to charge older customers up to three times as much as the young. Republicans have railed against the burden this places on younger workers buying insurance — and it’s true that Obamacare makes the young pay more so the old can pay less. But now Republicans are learning the difference between posturing against a law, and cherry-picking its downsides, and actually having to endorse an alternative position. When you have to pick winners and losers, not just complain about the losers in the other party’s law, you make people mad.

The energy among political activists has reversed, too. In 2009, tea-party activists flooded town halls and harried Democrats, often frantic with terror at imaginary “death panels” they believed the law would contain. Now it is advocates of Obamacare mobilizing in anger and chasing terrified Republican members of Congress down the street. Conservatives spent years lionizing demonstrations against Obamacare as the justifiable anger of a free people. Now they can see what health-care reform looks like from the opposing end.

There is no guarantee that Obamacare will survive. The Republican majority may decide melting down the health-care markets is worth the backlash. It wouldn’t be the first time they have taken a political gamble that seemed irrational. It’s possible that the Trump administration might intend to preserve Obamacare but wind up killing it through sheer managerial incompetence; a White House that can screw up something like an introductory phone call with the prime minister of Australia could screw up anything.

Still, the pattern of the three months since the election shows the cause of Obamacare repeal collapsing. Obama and his party were able to design a plan that squared the minimal humanitarian needs of the public with the demands of the medical industry. There is no evidence at all that Trump and his party can do the same. It is dawning on the Republicans that the cost of destroying this achievement in social policy may well be to destroy their majority.

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